June 7, 2012

Mobile Rules!

We can hardly keep up with all the latest, cutting edge innovations affecting and evolving the retail industry, specifically through mobile technology. Retailers in general are struggling with the widespread popularity of online platforms as well as learning to speed up to the fast paced nature of the industry. So how do we keep up? And more importantly, we've discussed showrooming before in our blog, Changing The Channel, but how can we drive traffic to brick and mortar operations and protect against the obstacles of this growing problem?

Overall, there are a few ways retailers can combat the rise of showrooming and the dangers it entails. Most importantly, merchandising is the signature advantage for in-store operations because both online platforms and mobile devices do not have the same capabilities when it comes to visual displays and communication. Not to mention by matching prices, endorsing coupons, and advertising via location, brick and mortar operations can begin to compete with consumers' inclinations to browse in-store and buy online. However, despite these tactics, showrooming will continue to challenge these physical shopping establishments as the digital world further progresses faster than they can catch up.


With "smart" technology taking over and social platforms making a major impact on the way we communicate, texting is another way retailers can tap into their customers through messaging in-store sales via "geofencing."  While many shoppers will shop in-store and purchase online primarily for the purpose of getting a better deal, with geo-fencing, retailers can target their customers in nearby proximities as they sign in via such apps as Foursquare to offer them coupons right to their phones. With everything about convenience, this method will surely drive more shoppers to buy now rather than later as they not only get a discounted price, but the product then and there versus ordering online (at generally the same price but with added shipping costs) and having to wait for it to be arrive.

However, are these new marketing efforts really helping stores as much as consumers? The outerwear company North Face, has been using geofencing since 2010 and not only targets customers near shops but around parks and ski resorts. In the two years North Face has been actively using this strategy, the company has only enrolled 8,000 users which isn't really that significant. In contrast, Kielh's has been experimenting with this strategy as well via its free standing stores and texting efforts and plans on eventually applying it to their kiosks located within department stores.

Google Inc. has begun to expand on its Google Offers sector by promoting daily deals based on location to consumers who access Google maps using their smart phones. Not to mention, PayPal just partnered with fifteen companies including Toys R Us, Barnes & Noble, and J.C. Penney to provide customers with the opportunity to pay via their cellphones. Overall, there is a major presence of mobile usage affecting the entire industry and companies will eventually need to learn the best way to tap into it as the challenge to directly reach one's customer and grab their attention becomes more and more complicated.

Looking at this new type of marketing which is commonly referred to as SoLoMo, Social Local Mobile Search, that requires customers to "check in," not only brings up the issue of privacy but yet again exposes consumers to a never ending overload of information. So who exactly is even using these geosocial apps? Research shows that only about 5% of people actually actively participate and 75% of these people are between the ages of 23 and 40. Analysts classify these shoppers as "the always addressable customer" due to the fact that they are connected to at least three devices, go online multiple times a day, and from multiple locations. This research only further solidifies the fact that companies need to heavily perfect their omni-channel retailing to continue to reach both Gen Y and eventually Z.

photo via TechCrunch

One of these said devices is of course the increasingly popular, iPad, which very few e-commerce retailers have begun to introduce and maximize on iPad optimized shopping experiences. However, just a few weeks ago, the iPad app, Shopmox, was released and offers digital catalog shopping for about 26 stores including the likes of Anthropologie, Gap, Banana Republic, Urban Outfitters, Old Navy, and Fossil. While the app specifically targets a primarily female audience, with many of the products featured falling into the categories of womenswear, maternity, and children's, it does reach out to the men's market and will eventually expand into home decor. In addition, Shopmox also offers a personalized experience as it creates a customizable boutique based on the stores you follow with recommendations and curated products.

video via springwise

Looking over to Seoul, Korean Emart (think Korea's take on Walmart) has placed 3D QR code sculptures throughout the city which can be scanned and used between the hours of noon and one each day based on the sunlight and shadows between that hour. With this code, consumers are directed to the promotion's homepage called "Sunny Sale" where they can purchase via their smart phone and have merchandise shipped directly to their front door. This is an innovative approach to how retailers can drive sales during specific times as well as increase the overall traffic on their sites.

photo via mediapost.com

What are some companies here in the U.S. doing? Well, Bloomingdale's for instance has launched a Big Brown Bag app for its smart phone users that basically gives them inside scoop on sales, in-store events, shopping, customer reviews, and even the ability to pay their bill online. Meanwhile, Macy's in conjunction with its "Brasil: A Magical Journey" promotion, will allow shoppers to throughly experience the journey while in-store through QR codes that take them on a trip to everywhere from the Amazon to Carnival to a soccer game to even encountering a toucan. As both department store legends continue to focus on the importance of incorporating omni-channel retailing into their strategies, specifically relative to mobile technology, they will only begin to tap into an entire new future that will put them at the forefront of the retail industry.

As you can see from simply looking around as well as through your own personal experiences, it's all about "smart" technology whether it be an Iphone, Ipad, or Android. These miniature devices can do so much, with so much more attainable each day. While the retail sector is only beginning to experiment with its capabilities, the industry is starting to realize the importance of omni-channel retailing by placing a greater emphasis on these mobile devices. QR codes, SoLoMo including geofencing, online digital catalogs, and paying via smart phones are only the beginning. So today we ask, how much smarter can our mobile devices get? 

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