I recently read a report by Deloitte Digital, titled “The Dawn of Mobile Influence”. It was a quick read with a lot of impact for the POS, mobile, and AIDC sectors. I highly recommend it! There are some fantastic data points (current and projected) that substantiate the impact that the rapid proliferation of smartphones and tablets (mobile) is having on how products are bought and sold. Some key points are:
- 48% of U.S. consumers own a smartphone and this number is rising quickly and globally.
- 58% of those use it for in-store shopping activities.
- Use varies greatly by retail category. The higher the price tag the more likely they are to use technology in the shopping processes (duh).
Keep in mind that this is not just for shopping – it’s for finding products, comparing prices, and adding items to wish lists.
This is happening at a time when traditional retailers are already under assault by technologically advanced, online competitors like Amazon and Wal-Mart. Just like with mobile, the higher the price point of the products, the more likely it is that online competitors are doing a better job of leveraging technology.
This has not gone unnoticed by retailers. Pretty much every retailer we know is currently working on a consumer-facing mobile application. For now they are all working on their own custom branded and highly differentiated apps. The early efforts I’ve seen seem more like mobile loyalty applications than a sales or customer engagement tool.
I believe that, ultimately, every retailer that is going to survive will have to master this digital medium. The day will come when most of us will not do business with any retailer that we are not electronically connected to.
Creating a 1-on-1 electronic relationship with the consumer is a top priority for every C-Level retail executive. Today, they all think it will be a standalone relationship. AccuCode respectfully disagrees. We think there were some important lessons to learn from existing customer loyalty programs. The carry-through rate is typically less than 15%. Top reasons referenced for not carrying retailer loyalty cards are:
- Too many cards – don’t want to carry them.
- Not enough relevant value in return (offers are not effectively targeted to the individual).
We believe the consumer will have a very similar perspective on retailer mobile apps. It is unlikely that consumers will be willing to download and use dozens of retailer-specific, branded applications. It seems more likely that the consumer will choose one or two primary mobile applications that will support them through the entire purchasing cycle for multiple retailers and categories. In fact, we believe it’s crucial that the retailers’ mobile strategy, systems, and processes merge seamlessly with in-store and online environments (the retailer’s as well as the consumer’s). That’s the idea behind AO: Retail, our new multi-channel, retail tool-set.
The technology now exists to truly engage with the consumer across all shopping channels and information channels so that the retailer’s view of the consumer is no longer limited to his direct transactions with that retailer. With AO: Retail, the retailer can now have real-time visibility of everything the consumer is shopping for: what he buys, from whom, at what price, where, and when. Better yet, the retailer can now interrupt the purchasing process (through targeted promotions and incentives) to intercept sales from shoppers at any point throughout the buying process, even if they’re shopping at a competitor’s store. The retailer can literally collect every product and price point that crosses the shopper’s browser, phone, or tablet. That’s pretty powerful.
For the consumer, it means convenience and cost savings. Comparison shopping can now happen in seconds, online or in-store. I can walk into anywhere and just start shopping with my own device. When I’m done, I may purchase in-store and self-checkout or order the whole thing online and have it shipped home. Either way, the choice is the consumer’s to make and the retailer’s to fulfill.
We think the long-term solution will be a multi-vendor, collaborative environment where there will be competition, but only because there already is today and always will be. That’s how the consumer likes it: a multi-tenant, collaborative environment that allows the consumer to engage in a consistent manner with all of their chosen retailers. This environment may serve much the same role as the mall or shopping center has in legacy retail.
What’s for sure is that mobile computing has and will continue to change how we buy all kinds of things. Those retailers that master the digital medium will thrive and survive. Others will miss it entirely and the cost will be BIG. As an example, I will point out that after the 2011 holiday shopping season, Amazon became and remains the largest consumer electronics retailer, much to Best Buy’s dismay.
If you’re a retailer, what’s your digital engagement strategy? If you’re a retail systems provider or POS vendor, what are you doing to help your retail customers make this transition? Are you part of their plans? Do you have technology partners that can help you and your customer today?Learn more about this topic at scansource.com >