Study summary: the role of mobile in the success of retail

research

Smartphones play a role in 67% of online purchases [1]. Even though the actual purchase may be done via another path, mobile can no longer be ignored by retailers if they want to be successful. Because of this importance of mobile for retailers, many researchers have studied the way consumers use their phone. Here, we want to give you a short overview of the most important results of these scientific studies for retailers.



Study 1: Integration offline and online crucial for retail

The differences between brick-and-mortar stores and online shops are very tangible to the consumer, even though the integration of both shops is essential to meet consumers’ expectations. A study (2016) with over 10.000 respondents from 13 countries [2], showed that the use of the smartphone plays an important role in the process towards buying a product in a brick-and-mortar store. Online is seen as the place where consumers can find all relevant information before going to the store to make the purchase. 

According to consumers (48%), the most important factor in a seamless cooperation between offline and online, is the possibility to go online to find the stock of your offline stores. This was found especially important amongst baby boomers. Besides the consumer research, this study analysed 162 companies from 8 sectors in 10 countries. This analysis showed that, in spite of the needs of the consumer, only 28 percent of retailers offered the possibility to check offline stock online. However, since data for this study was gathered in 2015, we have good hopes that this percentage is already a bit higher by now. 

But what happens if consumers come to your brick-and-mortar store in good hopes that the desired product is in stock but you are all out? About 24% of consumers expressed the desire to be able to use a digital ordering point in your store to place an order. At the time of this study, most stores did not support this option. Another important integration between offline and online is, according to 42% of the surveyed consumers, the possibility to use online coupons and discounts in the offline world. Next to that, consumers expect to receive real-time offers on their smartphone when they are in your store. Only 7% of retailers met this expectation. 

This is just a small selection of consumer’s expectations that show the importance of a seamless integration between offline and online. Especially now that most retailers have their own mobile websites, we must focus on the integration of mobile functionalities and apps in brick-and-mortar stores to increase sales and improve customer satisfaction. <


Study 2: Mobile beacons approach mobile

The strength of the combination between offline stores and mobile phones has been proven by many studies. But that doesn’t mean that this is not a challenge for retailers. With the right omni channel strategy, meaning the connection between offline and online, you can drastically improve customer satisfaction. The smartphone can offer a serious advantage in this connection. But how can you create an active role for the smartphone in your brick-and-mortar stores? Of course, consumers can already use their smartphone to check online channels for more product information and product reviews. But mobile offers more possibilities for customer satisfaction and interaction.

In a study [3] from 2016 with 99 respondents (mainly people between the ages 17 and 24), it was examined whether beacon technology met consumers’ expectations and needs in Germany. Beacons are small devices that send out a signal that is picked up by the customer’s smartphone. If the customer reaches such a beacon, location related content can be sent to the phone. For example, you could use this to send product information or offers if the consumer enters a specific department. In the USA, this technology is already frequently used. And even though beacon technology is also slowly taking over Europe, for many European retailers this technology is still uncharted territory. 

This study showed that this type of ‘proximity marketing’ [4] can indeed be embraced by consumers and thus offer a seamless customer journey. About 79% of respondents said the use of beacons in shopping centres woud be “very useful”. Also, they predicted an added value of beacons that would send them this week’s offers when they enter the store, beacons that would guide them through the store based on their digital shopping list or beacons that allow them to pay via their smartphone when they approach the check-out register. So, consumers seem ready. Time will show what results can actually be booked with beacons.


Study 3: Retailers can stimulate in-store sales with mobile

Consumers use their smartphone in stores to either find more information on the product or to pay for a product. Even though consumers in the previous study expressed an enthusiasm for mobile payments, this use of smartphones is not hardly as common as it is for information searches. And that in spite of the many possibilities and benefits for both retailer as consumer. This limited use would be a result of the experienced risks of mobile payments. But, considering the main benefits for retailers, retailers should consider stimulating in-store mobile payments. Several arguments are mentioned in support of this.

For example, dedicated apps could allow retailers to contact consumers as soon as they enter the store. Also, stores could send personalised and targeted content and offers and receive data about the consumer. By enabling in-store mobile payments, for example through the use of a scannable barcode or QR-code, retailers can create an advantage over competitors, analyse transactions or limit steps in the payment procedure. But what can retailers do to successfully introduce this payment method to their customers? 

Over 300 consumers took part in a study in 2016 [5], where researchers evaluated personal data such as phone use and demographics. After several manipulations, the respondents were asked if they would be willing to use in-store mobile payments. Social benefits, financial risks and privacy risks would determine this willingness. But in spite of what might be expected, this study does not advice consumers to focus their efforts on reducing their concerns regarding security and privacy. Instead, making shopping more fun would increase the likelihood of consumers to try mobile payments. 

This fun experience could be created by adding new functionalities or by surprising the consumer. Also, experience showed to be of influence. Consumers were not that willing to change their standard routine. To help consumers see the benefits of a new payment method, the retailer could choose to invite consumers to try the app and guide them through it step by step. Also, you could make the experience more fun by thanking your customer for his mobile payment with a discount code. This way you can encourage the consumer to use the app again or, more important, encourage him to shop in your store again once he sees you’ve made shopping easier than ever before.


Conclusion

In spite of the many different angles of these studies on the possibilities of mobile in retail, they definitely agree on one thing: the growing use of smartphones by consumers creates many opportunities for retailers to increase sales and improve customer satisfaction. But this means you have to meet the high expectations of the consumer. Because these expectations are changing so quickly, this will continue to be the topic of many studies. Of course, CM Telecom will stay on top of these results so you can count on us to keep you up to date on the latest developments of mobile in retail. 

Curious about the possibilities of mobile for your company? Contact our sector specialist Retail, Geert Vonck. He is more than happy to tell you more. 


[1]  Shop.org (2017) The State of Retailing Online 2017: key metrics, business objectives and mobile. Found online.
[2] Accenture (2016) Retail consumers are shouting - are you adapting? Found online.
[3] Thamm, A., Anke, J., Haugk, S., & Radic, D. (2016, July). Towards the Omni-Channel: Beacon-Based Services in Retail. International Conference on Business Information Systems (pp. 181-192). 
[4] Boidman M (2015) Proximity-based Communications: Adding beacons yields more intelligent digitalsignage in retail and out-of-home.
[5] Kerviler, G., Demoulin, N., & Zidda, P. (2016). Adoption of in-store mobile payment: Are perceived risk and convenience the only drivers? Elsevier. Found online.

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