Retailers Wrestle With Best Use Of Mobile To Up Sales

Retailers are still grappling with how to harness mobile technology to enhance in-store shopping and boost sales, even as consumers increasingly turn to their smartphones to research and make purchases. The promise of mobile as a seamless link between the offline and online shopping experience remains a remote aspiration for most.

A panel of retail and mobile technology providers and strategists on Tuesday highlighted some of the ways that brick-and-mortar stores are employing mobile to keep customers coming back, and the challenges they face integrating mobile in each phase of the path to purchase.

Speaking at MediaPost's Mobile Insider conference, Alistair Goodman, CEO of location-based marketing firm Placecast, pointed out that location technologies from geofencing to the more recent launch of in-store location systems like Apple's iBeacon make it easier than ever for retailers to track their customers. But that's only half the battle.

“What do you do once you know they're there?” he asked. What's the relevancy -- what's the data you apply on top of location in order to deliver something that the consumer is going to find valuable, not intrusive? That's the objective that we're all after.”

For Catalina Marketing, the goal has long been to get grocery store customers to buy more stuff by giving them a scanning device -- and now an app -- to scan items with their own phone as they shop. Then go to self-checkout lane to pay. Through its Scan It product, the company can provide customers with a bank of personalized offers based on their purchase history, said John Caron, Catalina's vice president of marketing.

“It drives an incredible amount of loyalty,” he said, pointing to a 6% to 8% increase in the average customer basket total. But he acknowledged that integrating mobile technology with physical stores is still “really, really hard,” because it requires a combination of human oversight and behavioral tracking to pick up on any suspicious patterns that might indicate someone is using the system to shoplift.

Still, as people increasingly focus on their phones screens instead of what's immediately around them, Caron argued that it makes sense for retailers to use mobile, ironically, for direct interaction with customers. “We already have blinders on in the store,” he said.

When it comes to car shopping, mobile has become an especially crucial platform for prospective buyers, noted Kayla Green, digital strategy director for Saatchi & Saatchi LA., who works closely with Toyota. She explained that the number of informational “touchpoints” car buyers go through during the purchase process has gone from eight to 22 in the last few years.

“Why is that happening? Because people have access to information on their devices at any time,” she said, adding that the use of mobile has increased five times in the car shopping process in the last year. As a result, the auto shopping window has contracted from three to six months to six weeks to three months.

While tapping into growing mobile usage, and the ability to  target customers in the physical world, panelists also emphasized the importance of an opt-in approach and not being overly intrusive. “Where push really crosses the line is where your incorporating highly personal data, when you haven't got permission -- then you lose the consumer,” said Goodman.

Like ScanIt, he indicated that Placecast's system learns what shoppers' preferences are over time and sends offers accordingly on an opt-in basis. “After six months, consumers in our program start expecting offers based on location, and come to understand the system is learning the things that they like,” he said.

Not everyone believes marketers need to be so careful about alienating mobile shoppers. Adam Guy, senior vice president, business development at Millward Brown Digital, suggested there is room to elbow onto the mobile. “What are you really interrupting, anyway?” he said. “I would love to see us be willing to offend a consumer by giving them information about something they may not realize they need to know.”
To get a better idea of what mobile consumers are doing, he said Millward Brown is building up a panel to track consumer habits on smartphones and tablets as it already does on a wider scale online. That includes what apps or mobile sites people frequent as well as how they shop on devices.

3 comments about "Retailers Wrestle With Best Use Of Mobile To Up Sales".
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  1. Retailigence Team from Retailigence, January 28, 2014 at 4:13 p.m.

    It’s a fair point that getting a consumer’s permission to market to them directly is necessary. Many brands and retailers have already cracked the code – they use mobile extensively, both text messages and location-based alerts passed via mobile searches and retailer apps, to let consumers searching for goods know where, locally in-store, goods are available. Technology isn’t a blocker, it’s an enabler of a closer relationship between brand, local retailer and interested consumer.

  2. Lauri Chertok from Measuringupapp, January 28, 2014 at 4:56 p.m.

    Personally I find it distracting when images and content pop up while I am trying to complete my grocery shopping. Understanding the potential value to the consumer, I would rather find the latest circular on a page so that I can budget my shop before I go into the store. I am all about organization not distraction. there is already enough of that in the store aisles.

  3. Crystal Leaver from Point Inside, January 29, 2014 at 1:40 p.m.

    With consumer data, it's all about a clear value exchange and dead simple opt-in/out ability. First, retailers need to give a reason for a shopper to want to use mobile tools. Product location, shopping lists, loyalty program integration, bar code scanners are all great tools to improve the in-store experience. Then, retailers have to be clear on what data they are using and how a customer can choose not to take part.

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