Overview of the mobile commerce market across the US and China, including its relationship to social, mobile payments and offline retail plus the key trends to watch.

1. Mobile Commerce
Across the US and China
@GGVCapital

2. Contents
• The US and China Markets
• The Critical Role of Social and Payments
• Relationship to Offline
• The Trends to Watch in 2014
Special thanks to researchers Andy Bromberg,
Jacob Cooper, Kai Jiang and Karine Hsu

3. 3
The US and China Markets

4. 4
2.7X
G R O W T H I N
N E X T 4 Y E A R S
US mobile commerce market
is growing with the rise of
smartphones – with $41.7B
spent in 2013 and $113.6B
projected by 2017.
Source: eMarketer, “US Retail Mcommerce Sales, By Device, 2011-2017,” Sep 2013.

5. China is leading the US in m-commerce adoption
46%
of mobile users
have ever
purchased
something on
their device
59%
of mobile users
have purchased
something on
their device in
the last three
months
Sources: Nielsen, “The Asia Mobile Consumer Decoded,” September 2013
(1) Mastercard Online Shopping Survey, 2013. Represents percentage of respondents who have made a purchase on a
mobile phone in the past 3 months.
(2) Business Intelligence by Business Insider, 2013. Represents percentage of US consumers who have ever purchased
something with their smartphone; percentage who have made a mobile purchase within 3 months would be lower
than this.
5
US C H I N A

6. China will soon
outpace the US in
mobile spend
In 2013, users in China
spent $26.7B through
mobile, representing 51%
average quarterly growth
– compared to only 15%
in the US.
Sources: US data is from ComsCore and eMarketer, 2013. China data is from
iResearch, 2013. Note: Chinese m-commerce figures have been converted from RMB
at the rate of 6.23RMB per dollar.

7. Top shopping apps have very high engagement in US
% of Users Who Use App At Least Weekly on iOS
50%
Wish
76%
H&M
Source: Mobidia, as cited by I 7 nternet Retailer, 2014.
79%
Retailmenot
74%
Shopkick
76%
Victoria’s
Secret

8. But China is already 12-18 months ahead of the US
Mobile commerce
platforms like Meilishuo
and Mogujie are already
generating billions of
dollars in GMV.
8
1.5M
10M
60M
2 0 1 1 2 0 1 2 2 0 1 3
Meilishuo Mobile Downloads (approx.)
Meilishuo via iOS mobile app. Disclosure: GGV is an investor in Meilishuo. Source: (1) China Network
Information Center (CNNIC), as cited by The Next Web, Jan 2014, press releases, Enfodesk.

9. Top categories in Asia vs. North America
Product Categories for Mobile Shoppers by Region
Music Downloads
Travel/Transport Tickets
Entertainment
Groceries/Food
Telecom Bill
Book/E-Books
Source: SAP Mobile 9 Consumer Report, 2013.
42%
44%
45%
46%
47%
49%
44%
36%
33%
20%
22%
39%
20%
39%
Clothes/Footwear
(by % Who Have Bought Something)
North America Asia Pacific
M-Commerce is
more prevalent
in Asia across
all categories.

10. Mobile shoppers
are fashion
shoppers
Clothing and accessories
are one of the top
products purchased on
mobile, with 54% of
tablet shoppers in the US
making a purchase in the
category
Source: eMarketer, April 2013; ComScore 10 MobiLens, August 2013.

11. But travel is also
gaining traction
Mobile travel dollars are
forecasted to make up
25% of total digital travel
spend in the US by 2016.
Sources: eMarketer, 2013; Expedia / Egencia “Future of Mobile Travel” Survey, 2013;
11
Hotwire / Harris Interactive “The American Travel Behavior Survey”, 2013.

12. 12
The Critical Role of Social and
Payments

13. M-Commerce correlates strongly with social
P U R C H A S E S M A D E O N M O B I L E
All of them Most of them Some of them None
8% 8% 5%
71%
62%
78%
7%
9%
4%
14%
21%
13%
Pinterest Facebook Twitter
Source: Vision Critical, “From Social to Sale” report, based on a
survey of 6,000 users of Pinterest, Facebook and Twitter, 2013.
13
Purchases that are
driven by social
platforms are
predominantly
made on mobile.

14. The convergence of social and retail is strong in Asia
14
R E T A I L E R S D I S T R I B U T E T H R O U G H S O C I A L
Xiaomi sold 150,000 smartphones
in under 10 minutes on WeChat in
November 2013
S O C I A L C H A N N E L S A D D I N G M - C O M M E R C E
In Feb 2014, WeChat announced
the support of payments to
merchants from Meilishuo, a top
social fashion site in China
T O P E - C O M M E R C E D E S T I N A T I O N S I N V E S T I N S O C I A L
In April 2013, Alibaba bought an
18% stake in Weibo, China’s
Twitter equivalent, for $586M

15. Growth of mobile payments supports m-commerce
The growth in mobile
payment volume, expected
at 35% CAGR, will bolster
the growth of mobile
commerce.
$53
G L O B A L M O B I L E P A Y M E N T S
$101
$163
15 Source: (1) Gartner, “Forecast: Mobile Payment Worldwide, 2013 Update.”
( B I L L I O N S )
$235
$325
$431
$563
$721
2010 2011 2012 2013 2014 2015 2016 2017

16. The mobile payment space has boomed and diversified
O N L I N E M E R C H A N T P R O C E S S I N G
M O B I L E P O S
P 2 P P A Y M E N T T R A N S F E R
C A R R I E R B I L L I N G
Classifications are based on key strengths of each company, but
companies may offer feature sets that span multiple categories.
W A L L E T S
Branded White-labelled

17. Case Study: Starbucks
Starbucks is a leader in
mobile commerce and
payments, with its loyalty-based
17
prepaid cards,
apps and partnership with
Square.
M O B I L E A S % O F T O T A L
P A Y M E N T S
10% 11%
14%
July '13 Nov '13 Mar '14
• Engagement is high, with 5M weekly mobile
transactions from an install base of 10M
customers
• Recently, Starbucks announced the addition
of mobile tipping for baristas, and is
considering licensing its mobile payments
technology to retailers

18. 18
Relationship to Offline

19. Mobile is still a small percentage of sales
5%
11%
<1%
21%
Source: Internet Retailer, “2014 Mobile 500.” Total sales figures 19 are from Capital IQ.
A S % O F T O T A L S A L E S
9%
2 0 1 3 M O B I L E S A L E S
19%
<1%
2%
<1%
Retail leaders – even
e-commerce leaders –
are still behind the
mobile curve

20. 67%
of consumers have
started a shopping
process on a mobile
device, but completed
the purchase
elsewhere
20 Source: ComScore, “Multiscreen Path to Purchasing,” 2013.

21. Mobile touches many parts of the buying process
Using social media to comment on a…
Writing a review of a purchase
Purchasing a service
Purchasing a phyical item on device
Using a device for payment
Making a digital purchase
Reading review of future/recent…
0% 10% 20% 30% 40% 50% 60% 70% 80%
Using mobile coupon
Using lists while shopping
Researching item before purchase
Checking price
Using store locator to find store
% Tablet Shoppers % Smartphone Shoppers
Source: Nielsen Mobile Shopping Report, Q3 2013. Includes 3,032 respondents 21 over the age of 18.
Only 40-45% of smart-phone
shoppers have
actually made a
purchase on their
device, but they are
using for related tasks.

22. Huge opportunities to align offline and mobile
22
Prepaid Accounts / Apps - Prepaid cards, available on a
mobile app, can drive huge sales and traffic.
E X : S T A R B U C K S
Same-Day Delivery – These networks rely on physical store
inventory, but offer the same convenience as standard e-commerce
and are accessible from mobile apps.
E X : I N S T A C A R T - P O S T M A T E S - D E L I V - S H Y P
Location-Based Marketing - A slew of these companies
exist, but retail adoption has just started to accelerate
E X : R E T A I L N E X T - E S T I M O T E - S H O P K I C K -
B E L L Y C A R D - A I S L E 4 1 1 - E U C L I D

23. Trends to Watch in 2014

24. Payments and Social Advances
Mobile payments beyond phones
and tablets
• eBay has developed shopping apps for both
24
the Samsung Gear and Pebble smart
watches
• Paypal has partnered with Samsung to
enable in-store check-ins and payments on
Gear 2 watches
• Wallaby, a mobile wallet that helps users
optimize credit card rewards, has released
apps for Google Glass and Pebble watch
• Who to watch:
Mobile Vertical Commerce +
Communities
• Fast-growing private companies that are
mobile-first and have launched in the last 5
years
• Picking large categories served traditionally
by horizontal e-commerce players and
offline retailers with little mobile presence
• Innovating through user experience,
curation, trust, social recommendations
• Integrating experience across content,
commerce, and community
• Who to watch:
Disclosure: GGV is an investor in Square, Houzz, Citrus Lane and Wish

25. Mobile – Offline Experiences
Beacon Technologies in Retail Stores
• Apple is placing a big bet on its iBeacon
25
technology, which enables iOS devices to
communicate with Bluetooth Low Energy
(BLE)-enabled sensors to send proximity-based
promotions, track foot traffic or
potentially enable payments
• Retailers such as American Apparel are
piloting the technology for in-store payments
and ads (powered by loyalty app Shopkick)
• Android devices running KitKat are already
able to detect BLE-enabled sensors, which
will help drive adoption beyond Apple users
• Who to watch:
Same-Day Delivery Services
• Crowd-sourced, courier-based, same-day
delivery networks are fairly prevalent in large
Chinese cities and are just now coming to the
US.
• Services like Deliv and Postmates offer
inexpensive, same-day delivery from physical
stores, accessible from a mobile app
• Such services are partnering with local
merchants and retailers to offer the same
convenience as e-commerce.
• Who to watch: