Consumers who carry and use handsets capable of web browsing are expected to increase their shopping via such devices. Predictions from industry analysts support this trend, with some saying North American mobile purchasers will spend $505 million in 2008, rising to $1.9 billion in 2010. That’s a small, but quickly growing slice of the $136 billion online retail market in the U.S.

So what does convergence really mean for the retail industry? That depends on who you ask. Phone companies view convergence as the integration of mobile and fixed Internet terminals, the iPhone being the latest advance in terminal access to the Internet. Convergence also relates to a device that provides all fixed and mobile voice and data services on a single handset.

For the population as a whole, convergence is about convenience and mobility. It’s creating devices that make it possible to attach “mobile” to many activities that used to be anchored to the fixed Internet, such as file-sharing, downloading, price-comparison, coupon-clipping and, of course, advertising and shopping.

BECOMING MOBILE-FRIENDLY
A proliferation of devices and other content receivers has created nearly limitless opportunities for consumers to access digital content. For retailers and their affiliate partners to remain competitive, they must master the process of content transformation across a variety of formats and platforms. The ultimate outcome is to enable easy, ubiquitous and consistent consumer access to high-quality content across their websites, phones and other online retail channels.

But those same devices are challenging existing business models. Device and format proliferation is costing online retailers significantly in terms of storage, infrastructure and increasing complexity.

The pace of change makes it imperative that retailers code their websites to address acute issues in user access, usability and performance. Here are some guidelines for making sure you’re mobile-friendly:

• Make sure your site works well whether a user’s browser can handle cascading style sheets (CSS) and JavaScript or not;
• Use XHTML when coding your site (and XHTML-MP when communicating with mobile phones);
• Customize the site for mobile phones by, for example, making telephone numbers clickable-to-call;
• Consider using a content transformation proxy to allow you to customize as much as possible for the large variety of mobile browser form factors and capabilities;
• Consider using image scaling and reducing color depths depending on the connection speed and display size of each device; and
• Don’t depend on cookies to be supported consistently.

Retailers need to learn how to create mobile-friendly websites, adapt their content to the capabilities of different devices, save bandwidth with compression and create server-side logic that integrates with a mobile front end. Retailers should also become familiar with other methods for integrating their web application with mobile technology: sending and receiving MMS and SMS messages, accepting mobile payments and working with voice calls to provide spoken interaction.

RETHINKING AD DISTRIBUTION
Until now, the advertising industry has focused much of its mobile efforts on tracking impressions or clicks. An emerging trend, however, is putting the focus on more precise targeting and measurement, and giving advertisers tools to better reach mobile consumers and track their transactions. Advertisers and publishers are also experimenting with new forms of content, and this is affecting mobile commerce as well. We are starting to see product links and display ads mashed-up with affiliate content, community and business models.

These dynamic new technologies are starting to influence social commerce, wikis and widgets, while helping to drive mobile revenue and setting the stage for m-commerce’s future. The bottom line is that the future of affiliate marketing in mobile promises to change how consumers shop.

Here are just two examples of progressive advertisers and publishers already making a play for the mobile consumer.

1-800-FLOWERS.COM wanted to reach its customers whenever and wherever they go, so the company stepped up its mobile commerce capabilities. In 2007, the multichannel retailer introduced a new capability that allows it to reach mobile consumers, track their m-commerce transactions and compensate their publisher partners on a pay-per-action basis.

BensBargains.net created a website specifically for mobile browsers because it wanted to reach the mobile customer with ads. The company, one of the oldest deal and coupon sites on the Internet, customized its website so it can measure the buying behavior of mobile consumers with greater accuracy.

Another way to engage consumers is to create a product-based experience using real-time data feeds about those products. In turn, those publishers who are adapting to the mobile consumer will be able to help retailers target ads and improve their reach. By working with appropriate publishers, your ad might be aptly placed in a

YouTube or AdSense video, within a Facebook widget, delivered via geo-targeted text message, or maybe alongside a Twitter conversation.

Because affiliate networks have, to date, provided much of the strategy and insight for all things “new media,” learning how to leverage this kind of media consumption is going to be–in fact, has already become–their responsibility.

Jonathan Levine is co-president and CTO of LinkShare, a performance-based marketing company based in New York City. He can be reached at jlevine@linkshare.com.