What retailers think about mobile

 

For the last 2 days I've been at shop.org in Dallas Texas. The conference was very impressive. It was clear that mobile is a hot topic for retailers and in-store mobile solutions is a very hot area. The above info-graphic does a good job of portaying the current sentiment of retailers towards mobile at this present time. Clearly mCommerce is dominating their thinking... it is synonymous with mobile.

Some interesting stats and consistent messages that came out of shop.org for me:

• Mobile is a white-hot topic and everyone was focusing on it.
• URBN CEO believes that mobile may impact in-store more than online. (This is also my belief). In fact, this was the primary headline from the NRF this morning.
• 72% of retailers have a planned mobile strategy for 2011 (Forrester).
• Most vendors and retailers agree that starting broad with a mobile web strategy is smart and then drive niche after that with apps, starting with iPhone and then heading into Android and RIM.
• Both Godiva and Barneys receive about 3% of revenue coming from their mobile web site. Was 1% last year, and they’re expecting it to double to 6% this year.
• Typical conversion rates on mobile with an unoptimized website is about 0.7% - 1.0%. With an optimized mobile website in place that conversion typically lifts to 3-4%. However average order size is slightly lower on mobile and the bounce rate can be slightly lower too.
• Wetseal have launched an in-store “scan” application and are getting 1M page views in the app per week. 25% are happening in the store itself.
• In the mcommerce experience the checkout process needs to be given the most attention during the build phase to maximize conversion.
• Many retailers are accompanying their app/mobile web site with a text call to action in the store. (My opinion, I would recommend “Text JOANN to 75920 for instant offers. ” We can then load an offer straight into their wallet.)
• While Apple has 10 times the number of apps in the app store even though android now has more handsets in the market. Several retailers advised that iPhone/iPod/iPad still account for 70% of their mobile traffic.

Some interesting stats and consistent messages that came out of shop.org today:

·         Mobile is a white-hot topic and everyone was focusing on it.

·         URBN CEO believes that mobile may impact in-store more than online. (This is also my belief). In fact, this was the primary headline from the NRF this morning.

·         72% of retailers have a planned mobile strategy for 2011 (Forrester).

·         Most vendors and retailers agree that starting broad with a mobile web strategy is smart and then drive niche after that with apps, starting with iPhone and then heading into Android and RIM.

·         Both Godiva and Barneys receive about 3% of revenue coming from their mobile web site. Was 1% last year, and they’re expecting it to double to 6% this year.

·         Typical conversion rates on mobile with an unoptimized website is about 0.7% - 1.0%. With an optimized mobile website in place that conversion typically lifts to 3-4%. However average order size is slightly lower on mobile and the bounce rate can be slightly lower too.

·         Wetseal have launched an in-store “scan” application and are getting 1M page views in the app per week. 25% are happening in the store itself.

·         In the mcommerce experience the checkout process needs to be given the most attention during the build phase to maximize conversion.

·         Many retailers are accompanying their app/mobile web site with a text call to action in the store. (My opinion, I would recommend “Text JOANN to 75920 for instant offers. ” We can then load an offer straight into their wallet.)

·         While Apple has 10 times the number of apps in the app store even though android now has more handsets in the market. Several retailers advised that iPhone/iPod/iPad still account for 70% of their mobile traffic.

Victoria’s Secret: On-brand mobile marketing. Now that’s INCREDIBLE.

 

What’s makes Victoria’s Secret’s new INCREDIBLE bra so…well…incredible? It finally incorporates features that women have been seeking for decades—a cushioned underwire, a flat closure system and self-adjusting straps just to name a few. With a product like this, it’s only natural that the brand would want to spread the word with an equally incredible mobile campaign. 

 

 

So, a series of 4 poll questions was sent out (to existing Victoria's Secret mobile subscribers as well as those who opted in via a website call-to-action). Each creatively worked in a feature of the bra, but then posed a multiple choice question that got recipients to respond. 

 

The best part was that these questions had a playfulness to them. Slightly flirtatious undertones even. And this is exactly the kind of communication you should expect from a brand that sells push-up bras, thongs and bustiers. 

 

 

QR Codes and Retesting Assumptions.

The last 2 years has seen a surge in the popularity of "smart phones" in the US market.  This has us all looking for the next "big thing" to do with these amazing devices.  But there's also a realization that some technologies that seemingly failed previously may have been waiting for this revolution all along.

Take QR codes, four years ago I was sure QR codes where a dead end.  Nobody had a decent QR code reader,  and getting one loaded onto handsets was almost impossible.  I can recall watching twenty people, who worked in mobile, trying to load a popular reader onto a phone.  One succeeded, and we wanted people walking into a store or down the street to attempt the same thing!  Fast forward to 2010 and you'll see a resurgence in QR codes.

They're once again appearing, in street sign advertising, on store windows, as separate labels on products, on websites, and even on t-shirts.  The smart phone revolution has meant that not only do we now have the apps to make use of the codes, be we also gain the all important data network in order to really make the information contained with the codes truly useful.  And generally speaking, "being useful", is a great motivator to get people to use something.  The codes are also easy to incorporate into current creative assets, as well as becoming well enough understood that instructions on tier use can be minimal.  There's also something interactive and neat about scanning the code that's a lot more enjoyable than typing a Url.  It's worth keeping in mind that sometime new technology makes "old" technology useful again.  Retest your assumptions in light of what's available to you now, it's interesting to see what you might find.

Some great QR code uses:

- Google provides businesses with stickers for their window, which send the customer to a mobile friendly version of their Google Place Page. 

- The Cellar Key is adding labels to wine bottles which redirect to a mobile site containing tasting and pairing notes etc.

- Scvnger is "a game about doing challenges at places", they make extensive use of QR codes inside buildings where GPS doesn't work so well. 

- Google provides developers deploying apps on their market a QR code.  People can then scan the code from a PC monitor, and be directed to the app on their phone. For an example see the mobile shopper app.

- Calvin Klein chose to make QR codes the central part of a recent campaign.

A retailer’s Dilemma: to mcoupon or not to mcoupon?

 

Store-based retailers work primarily on two big problems. The first is driving foot traffic into the store, the second is converting customers who are in the store into buyers. Mobile marketers have improved their ability to drive foot traffic to the store in recent years, using a variety of tactics from offers, loyalty clubs and sweepstakes all directed at enticing customers into the store. But the second problem of converting consumers standing in the store is a problem which has received little attention by mobile marketers. Until recently.

Shopkick launched a few weeks ago with much fanfare, raising awareness of the in-store opportunity that mobile marketers can affect. I’ve been engaged in many in-store mobile marketing programs over the years but I would never say it has moved past experimental. How many retail outlets have you visited recently that encourages you to pull your phone out of your pocket and engage with the brand? It is rare.

I’m intrigued by the dominant approach in the industry toward addressing in-store conversion: couponing. That is, how do I convert a shopper into a buyer when they’re standing in the store? Well… I give them a coupon of course. When all you have is a hammer…. Everything looks like a nail.

Crossview very recently published a study in Mediapost saying that most consumers (37%) prefer to receive their coupons and offers via email and only 11% of them are interested in receiving offers in-store. If so few customers are interested in receiving offers in the store, why are we pushing it so hard?

Last week I had the honor of co-presenting on a panel with esteemed and respected mobile marketer Andrew Koven from Steve Madden. After discussing the broad range of impressive mobile activities he is undertaking at Steve Madden we got to talking about the new Shopkick app. Mark Walsh from Mediapost moderated the panel and drew the following insight out of Koven: “I don’t want people to come into my stores and play games to get coupons. I want them reviewing our merchandise and converting to buyers.”

The retailer CEOs I meet will tell you that Coupons are a drug. Once you get hooked and let your customers get hooked, it’s hard to come back. So there is a constant fight to reduce the reliance on coupons from a marketing perspective

So if coupons aren’t the answer, what is the answer to using mobile to help convert shoppers into buyers?

There is a well known store conversion statistic that applies at most retailers. I call it the 10-4-1 problem. Of 10 customers that walk into a store, 4 of them intend to buy. 3 out of 4 of those consumers walk out empty handed, only one of them buys. The retailer’s job is to convert 3 out of 4 non purchasing intenders. Retailers have tried many different in-store solutions to this problem and they’re all working hard on it. Most retailers know that the reason these intending purchasers don’t buy is that they couldn’t find anything they like. They didn’t say, it was too expensive and if they’d given me a discount I would have purchased, they said, “I couldn’t find anything I liked.”

So one of the biggest obstacles to converting a consumer is, the lack of inspiration and education.  Retailers attempt to use store associates to solve this problem. Retailers wage a war in maintaining the cost of getting great associates who are able to inspire and educate their consumers. We also know that consumers are often wary of commission hungry store associates. This is why consumers do their research online then head to the store and hunt straight for the item they’re after. By providing critical inspiration and education tools to consumers in the store, the consumer can find what they’re after quickly and easily.

We know mobile can bridge the divide between the store and the online website. How do we make that happen? How do we use mobile to inspire customers when they’re in the store?

Imagine for a moment you are standing in a Banana Republic store. There are no store associates around, and you see an in-store poster encouraging you to try their “mobile companion.”  You pull out your phone and the companion entices you to scan the barcode on the pants you’re admiring. You scan the pants and the companion offers you 10 ensembles containing the pants. The ensembles are in BBQ mode, casual mode and work mode. Why be limited to a store of only 10 mannequins, when I can have 1,000 mannequins in my hand built around any item I’m interested in?

The companion then tells you where in the store you can find these other items in the ensemble. If the items are out of stock, Banana Republic gives you free shipping for the item (still closes the deal). Since the companion is bridging the store and the online world, I’m able to easily see any reviews and complaints about this product. The pants come with a recommendation to a tie and so the Companion offers up a Summer 2010 how to wear a tie education article.

Sound far fetched? I don’t think so. These  forms of inspiration and education are going to become common place in the very near future. I believe that bridging the gap between stores and online is inevitable and an exciting new adventure in the progressive world of mobile.

I had a recent conversation with Michael Boland of BIA Kelsey a boutique research firm that specializes in the local social mobile space. He saw the “in-store mobile” domain to be a rapidly growing sector. He also agrees that the foursquares and Shopkicks are going to have to move beyond game mechanics and that “…there is going to be a shakeout where there has to be an exchange of real value going on between the retailer and the consumer.”