By Ryan Garner (GfK) and Alex Kozlof (IAB UK)

The irrepressible tide of smart, connected, mobile devices is changing the way we shop at every stage of the purchase process. This poses new opportunities and challenges for product marketers and retailers in both the online and offline world.

The ‘always on’ nature of smartphones – not just in your pocket but also connected to the internet – makes them the perfect companion for shoppers throughout the entire purchase journey, both online and offline.  Recent research by the IAB and GfK shows that while PCs (laptops and/or desktop computers) are still the most used devices throughout the online purchase process, smartphones are an increasingly important complement to existing methods of shopping. The number of shoppers using smartphones will inevitably increase, but this usage will in many cases be in conjunction with the PC or an aid to the consumer while in store. Indeed, the research showed that the most common behaviour was for the smartphone and PC to be used together in the purchase process rather than independently.

The smartphone market has been growing rapidly over the past few years, with smartphone adoption spreading across the population. The youth market is also picking up this trend and the numbers who want or own a smartphone device are growing. So which smartphones are being adopted by future generations and why?

A smartphone for Christmas

The youth market for mobile devices is swiftly rising, and the age at which children acquire their first mobile phone is getting younger and younger. It is estimated that over 90% of 12-15 year olds already have a mobile phone and the number of smartphone acquisitions in this market is also growing [1]. Considering that a large amount of mobile phones acquired by the youth market are being gifted and are often from the medium to high-end price range, it is not surprising that the youth market are picking up the smartphone trend. Also, considering that most of the time it is the end-user that is influencing purchase of the gift, it is interesting to find out what are driving these decisions [1].

In the PC market, Microsoft’s Windows OS is as common as the mobile phone in your pocket. However, Windows Mobile has struggled to capture the imagination of both consumers and businesses. In fact, with a rapidly declining 5% [1] of the global smartphone market it’s fair to say that relatively speaking Windows Mobile has been a horrible failure. But that’s all about to change.

Recent research by GfK NOP [2] shows that interest in Windows Phone 7 (the catchy name given to the successor of Windows Mobile 6.5) is strong. Almost one in five (18%) of UK mobile phone owners say they would consider a Windows Phone 7 (let’s go with WP7 from here on in) handset (available on HTC and Samsung devices among others) when they next come to renew, upgrade or buy their next mobile phone. Of course current smartphone owners display much higher levels of interest (32%). What’s more, Microsoft will be pleased to hear that of all smartphone owners, those using Google’s Android will be most interested (41%) in WP7. So what’s changed?

Apple is a leading force in the smartphone market because they simplify services and enable people to fit their world in their pocket.

Yesterday, Steve Jobs announced the latest iPhone 4 at WWDC but what struck me was the way he structured his presentation. Jobs focused early on about the success of the App Store for both consumers and developers. There is now 225,000 apps available, 5 billion downloads and Apple has paid out $1 billion dollars to developers. Apple has created a vibrant market place for mobile apps and services with more big brands to launch later this year. That is success unrivalled by anyone.

To cover all this first was smart because Jobs was focusing on the services and the benefits of owning (or developing content for) an iPhone. After all the device features are becoming less important over time whereas services and content is increasingly driving consumer demand in the smartphone (as opposed to the feature phone) market.