Powering the Mobile Retailer

If the retail forecasts are correct, Americans will soon be shopping on the go a lot more than they are now, and the entrepreneurs behind Mobify plan to be there behind the scenes when it happens.

Mobify, a "software as a service" company whose dozen or so clients include the retailers Lululemon, Threadless, and Bonobos, is taking advantage of what it sees as a hot and emerging sector for merchants: mobile websites for consumers who want to shop anywhere, anytime on their smartphones or tablets.

“Retailers look at their mobile Web traffic, and it’s going through the roof,” says Igor Faletski, who cofounded the Vancouver, British Columbia-based software company with John Boxall five years ago. “It’s really the beginning of mobile.”

Although the company started out providing mobile versions of websites for publishers—and it still lists Teen Vogue and The New Yorker among its clients—it is now increasingly looking to mobile commerce as a source of growth going forward. The technology it developed for retailers would not have even worked one year ago, as phones were too slow at that time, Faletski says.

In Mobify’s corner on its mobile-commerce aspirations are some analysts who say that mobile commerce is now what e-commerce was in its infancy. At last week’s Web 2.0 Expo New York, mobile shopping was the talk of the show during retailing sessions.

"Commerce must be everywhere," said Cliff Conneighton of the e-commerce consultancy firm Elastic Path Research, during a session on e-commerce. "Products and information about products must be everywhere, buyers must be able to come from anywhere, and transactions can occur anywhere."

Worldwide, mobile-payment volume is forecast to total $86.1 billion, according to Gartner Inc., up 75.9 percent from a 2010 volume of $48.9 billion. ABI Research projects that shoppers will spend approximately $119 billion by mobile phone by 2015, a figure that represents 8 percent of the overall e-commerce market.

Mobify offers an HTML5 platform for its retail clients that allows its customers to use the same URL for mobile shopping as they do for shopping on a desktop or a tablet. That’s important, says Faletski, because as social commerce increases, and friends refer one another to different shopping websites, it’s best to have a singular URL versus a mobile-only URL, so that the website link is appropriate to the device used. (You wouldn’t want to view a mobile-only website URL or an "m-link" on a desktop computer for instance.)

“Long-term, there’s going to be just one link for everything,” says Faletski “The goal is once you do that, the customers start coming to your store more often.”

What’s more, the conversion rate for people to pull the lever on a purchase is higher on tablets and mobile devices. According to Faletski, clients double their mobile shopping revenues within 100 days of using Mobify’s software.

So, what about Mobify's own revenues? Faletski says they are in the "low- to mid-seven-figure range," but wouldn't be more specific. However, as the self-financed company gathers steam in mobile commerce, it has done well enough to have doubled its headcount to 20 in the last eight months.

Mobify has some big rivals in companies like Usablenet and Digby, which are full-service operations that handle all aspects of the mobile websites and apps, whereas Mobify simply provides the software. But the advantage Faletski says Mobify has is that it allows retailers to control the sites themselves, providing flexibility to those who have the on-site tech teams to handle making frequent changes to mobile sites if they want to add or delete items, for instance.

Both 26, Faletski and Boxall met as software-engineer students at Vancouver’s Simon Fraser University, and right after graduation, became, Faletski says "reluctant entrepreneurs" in their quest to work as independent contractors.

Mobify's offices in Vancouver—also former home of Flickr and current home of HootSuite—include a yoga studio with mats and an exercise area. A nod to their retail client Lululemon, which provides high-end yoga gear? No, says Faletski, who says that in order to attract top-notch talent, the company competes with Silicon Valley on quality-of-life perks like an on-site gym.

“And I just love yoga,” says Faletski.

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Teresa Novellino writes for Portfolio.com