Will Apple and Google Rule Customer Loyalty in Mobile?
Smartphones have changed forever the information consumption habits of consumers. While those changes are most obvious in areas such as social networks, the news media and search engines, they have been perhaps most impactful in the retail industry. Read more...
Retailers Need More Than Fun When It Comes to Gamification
Consumers have been exposed to games when they shop for decades. As far back as 1896, grocers distributed Green Stamps that were collected to earn shopping rewards.Read more...
Is This the Death of Black Friday?
Black Friday is a week away, and the news is full of stories anticipating retailing’s version of New Year’s Eve. But this year will be different – a lot different, I think – so much so that I wonder if Black Friday as we know it is dying.Read more...
Augmented Reality: Beyond the Gimmick
Mikael Karlsson, mobile marketing manager for Volvo, shocked the audience at the 2012 Apps World conference when he described augmented reality as an overhyped marketing gimmick. Read more...
What Are Smart Retailers Really Selling?
Retail was founded on a very simple principle: to acquire and make available for people that which they could not easily or affordably obtain on their own. Thus, buying wholesale and selling retail was – and is today – a service to the community. Read more...
Black Friday is a week away, and the news is full of stories anticipating retailing’s version of New Year’s Eve. But this year will be different – a lot different, I think – so much so that I wonder if Black Friday as we know it is dying.
The designation of the day after Thanksgiving as the traditional start of the holiday shopping season has been with us for decades. The first uses of the term have been traced to early 1960s Philadelphia, where the retail universe revolved around Wanamaker’s department store. Fifty years later the retail landscape couldn’t be more different, and changes in consumer habits and new approaches from retailers seem to be conspiring to radically change the Black Friday ritual.
More shoppers never leave home
The most obvious change, of course, is online shopping, which last year accounted for nearly 40 percent of the total spent last year during the Black Friday weekend. That’s up from 23 percent five years earlier. Back in 2006, the vast majority of online shopping happened on desktop computers. Remember, the iPhone didn’t come along until the next year. By 2011, smartphones were being widely used in the shopping, and this year seems poised to be the year of shopping with a tablet. So many device options will make standing in line for a television even less appealing.
Smartphones have changed forever the information consumption habits of consumers. While those changes are most obvious in areas such as social networks, the news media and search engines, they have been perhaps most impactful in the retail industry. To find a shop, film, restaurant or the latest fashions, smartphone owners no longer hesitate to use their mobile devices.
The most observed search behavior among mobile users is the research of products, retailers and promotions. These activities usually are undertaken for very specific reasons:
– Location of products and services locally. These users want to find a place close to their location offering the product or service they are looking for.
– Comparison of products and services. Mobile devices deliver information about products and services and allow users to compare them before they buy.
– Reviews and comments. By reading the views of others, shoppers can reassure themselves they are making the right choice.
Decoded Fashion’s inaugural London salon launched recently to a full house, with both the retail and digital industries present to watch a line-up of global pioneers – including Facebook, Google, Topshop and ASOS – discuss the blurring of fashion and technology. We heard how mobile shopping will have a huge impact on fashion-related holiday shopping, customers want more opportunities to purchase online, and some widely held assumptions used in social media marketing are flawed.
Think of your typical social media user and we immediately imagine a younger demographic: Generation Z or the Millennial perhaps? Not necessarily. Facebook’s Director of Retail Fashion & Luxury Partnerships, Tracy Yaverbaun, revealed that a larger than average proportion of high-net-worth individuals are using the social networking site disproportionately. That makes Facebook an underappreciated tool for reaching the affluent luxury consumer. With successful digital campaigns already launched by Cartier and Tiffany, Facebook will reveal further findings in a full report on the topic released on November 20.
There’s plenty of optimism about holiday sales this year, and why not? The convergence of online and in-store experiences continues to pick up speed. Retailers have recognized the huge opportunities in mobile retail. And the popularity of tablet computers has opened the way for a new wave of shoppers who never leave home. If 2011 was the year of shopping with your smartphone, 2012 is the year of shopping with your iPad.
Amid all the holiday sales forecasts floating around these days, this one from Forrester Research jumped out: Online shopping in the U.S. will be up 15% this holiday season to $68.4 billion; and average spend will be up 12%. Sucharita Mulpuru-Kodali, vice president and principal analyst at Forrester, has been quoted as saying that the increase stems from two things: online shopping and mobile commerce.
Mikael Karlsson, mobile marketing manager for Volvo, shocked the audience at the 2012 Apps World conference when he described augmented reality as an overhyped marketing gimmick. Commenting that it could be “a great installation within retail stores” but is currently just a technically limited pipe dream. AR is a heavily discussed topic at the moment. Here at FORA, Dave Rodgerson touched upon the potential for AR within the store. And while Karlsson is correct that limited Internet connectivity and device functionality can hinder AR technology, what’s more often missing is correct context and that all-important incentive to purchase.
Despite predictions of consumers downloading more than 2.5 billion AR apps per year by 2017, a recent eBay study found that only a quarter of retailers plan to introduce AR within the next two years. Brands and retailers have a real opportunity to explore and gauge the potential applications that suit both the brand and the customer. So, how are retailers utilizing this technology to take it beyond an overhyped digital fad?
Consumers have been exposed to games when they shop for decades. As far back as 1896, grocers distributed Green Stamps that were collected to earn shopping rewards. How many times as a kid did you open a box of Cracker Jacks to find a small toy tucked inside? Even the cereal box tops that kids sent off to Battle Creek, Michigan, for a “free gift” were early examples in gamification.
I recently completed an online course through the University of Pennsylvania’s Wharton School on gamification, specifically how game design can be applied in a business context to engage new consumers and create a more compelling customer experience in the retail environment. What I learned was that these consumer games have become far more complex than at any time in the past. They rely on a basic understanding of human psychology to inspire and motivate consumer shopping behaviors. Understanding these triggers, and having a clear plan of the impact these behaviors can have on a business plan is quite a powerful thing.
Remember the adage that a happy customer will tell one person and an unhappy customer will tell ten? Now, with social media, an unhappy customer can tell hundreds if not thousands of people instantaneously. The result is a new type of customer who expects real-time response to concerns and complaints and is quick to turn to social media to get that response.
What does this mean for brands? A survey by NM Incite says that 47% of respondents have used social media to receive “active customer service.” That figure is 59% among 18-to-24-year-olds. Almost one in three users prefer using social media to calling a 1-800 number, says a recap of the survey at BizReport.com.
‘Implications are enormous for brands’
“What we’re seeing is that customers are turning to social media channels for customer service, regardless of whether and where a particular brand is actually equipped to handle customer service over social media,” says Gadi BenMark, senior vice president of NM Incite’s Advisory division. “Today’s customers choose when and where they voice their questions, issues and complaints. They don’t care if a company is set up to answer customer questions on Facebook, or if it has an actual Twitter handle for customer service.”
Retail was founded on a very simple principle: to acquire and make available for people that which they could not easily or affordably obtain on their own. Thus, buying wholesale and selling retail was – and is today – a service to the community. Whether the true need of the consumer was convenience or access to something that made life better in some way, the retail business was never about the item for sale. In fact, I maintain that with just one exception, the real product in retail was, and always will be, one of two things: convenience or happiness. The exception, of course, is when it is both.
If you can make life for easier or more pleasant for your customers than your competition can, you will always win. If you doubt this for one second, look at the rise of smartphones. These are items that we clearly cannot live without, except that for thousands of years we did. The price, relatively speaking, is astronomical, and yet there is no market segment that they have failed to penetrate.
With the holiday season fast approaching, retailers are facing increased demands and challenges. Among them is meeting the significant boost in online order requests, which places new demands on how retailers manage their distribution centers. Retailers must be able to get the right product to the right customer in a timely manner. And with worldwide e-commerce growing at a rate of 19.4% a year, efficiency and accuracy in filling orders is more critical and challenging than ever.
As online and mobile shopping have increased – especially during the holiday season – retailers have responded by implementing more advanced web and mobile sites, offering special online deals, and deploying new technology to optimize the online storefront. However, many have left their existing distribution center infrastructures in place. These existing infrastructures and fulfillment processes are inadequate to fully address the shift toward direct-to-consumer orders. Now, orders need to be processed and handled differently with no room for error in product delivery and timeliness.
I recently attended Internet Retailer’s Mobile Marketing & Commerce Forum; and instead of attempting to organize everything I learned into some kind of story or structure and say that it all ties nicely together, I’ll give you a taste of what I experienced, which is an onslaught of lessons, factoids, and experiences shared by every combination of cross-channel, online-only, even mobile-only retailers. Ready? Here we go:
According to Etsy, 1 in 5 of the clicks on Pinterest that led to commerce leads to Etsy. Etsy’s mobile strategy, as a result, has been to focus on mobile page renderings that prioritize the image last – because the shopper already knows what it looks like. They want the other product details first.
Mobile web drives customer acquisition. Mobile apps drive customer retention. So it’s no longer about app vs. web when it comes to mobile, at least not for conference speakers – and this was a pretty universal theme. So it shouldn’t be surprising that retailers’ biggest priorities when it comes to apps revolve around customer personalization. Nearly every speaker talking about apps said that personalization was central to their ability to continue to retain customers.