Holiday season 2011: Driving in-store traffic via mobile devices
With the holiday season fast approaching, there has been a significant amount of press coverage regarding the role mobile devices will play in driving retail sales this season. The consensus is that mobile devices are changing the shopping landscape, and that the 2011 holiday season will be the tipping point — the year that consumers widely integrate mobile devices into their shopping routine. “This November holiday season will mark the true advent of the post-PC era with consumers demonstrating a heightened interest in adding mobile devices to their holiday shopping arsenal,” noted IBM’s John Squire, in response to an IBM Coremetrics Benchmark analysis showing that 15% of people in the United States accessing a retailer’s website are expected to do so via mobile devices.
What does this mean for the retail community? Are shoppers going to be bypassing in-store shopping in favor of online mobile purchasing? In consulting engagements with large consumer packaged goods companies and retailers, we are seeing concern that mobile commerce (m-commerce) will diminish in-store traffic, as shoppers abandon stores in favor of phone and iPad purchasing. This is a valid fear, as m-commerce is a second channel (in addition to PC-based ecommerce) which allows shoppers to purchase without walking the aisles.
But not so fast. Based upon multiple indicators, including in-depth interviews with drug, grocery and big-box retailers conducted for a recent whitepaper on mobile marketing and the retail channel, we have every reason to believe that mobile devices will actually DRIVE foot traffic for those retailers who choose to participate in the mobile revolution. It’s counterintuitive, maybe, but consider this — by-and-large, shoppers aren’t using mobile devices to make purchases. Shoppers are using mobile devices to gather information, compare prices and make decisions, and this oftentimes takes place in the aisle of a store.
According to a recent PriceGrabber survey, just 4% of 2,322 consumers interviewed regarding their holiday shopping plans stated that they would make purchases via mobile devices, up from 3% last year. While mobile apps are making it easier for shoppers to buy via mobile devices, shoppers aren’t yet making the switch to mobile purchasing. For brick-and-mortar retailers, this is good news. There is a real opportunity for retailers to develop innovative mobile strategies, resulting in increased customer loyalty and “traction” among consumers. The investment in mobile will pay benefits all year long, not just during the shopping season.
How, then, does mobile drive traffic to stores? What is yielding results? Via interviews with retailers, we’ve identified key tactics that are being used to increase store visits.
- E-coupons: In its 2011 holiday survey report, Deloitte noted that 41% of smartphone owners plan to receive coupons via their mobile handset.
- “Daily deals”: We can expect to see more “short-term” deals this holiday season, with retailers offering deep discounts for a limited number of days. This can be a surefire way to drive traffic over a concentrated period of time.
- Innovative social media: Most of the major drug stores have Twitter options, which allow the retailers to “tweet” new discounts and promotions. For the 2011 season, Walmart has launched 3,500 store-specific Facebook pages (which can be accessed via mobile devices). These pages alert shoppers to “Rollback Alley” deals, new products and special events.
The 2011-2012 time frame is a golden opportunity to implement a mobile strategy to increase foot traffic. Retailers acting quickly will help shape the m-commerce landscape, and will be well-positioned as smartphone and tablet adoption increases and technology improves. As the New Year approaches, ask yourself what you are doing to win shoppers via this channel. By developing a mobile communication strategy with consumers now, retailers can grow shopper loyalty and traction, increase mindshare and drive sales.
Moira Koch is a VP at Maia Strategy Group, where she leads consumer packaged goods engagements with an emphasis on retail insights. Prior to joining Maia Strategy Group, she was responsible for developing and launching Bluebeards Original, a premium line of Men’s beard care products sold in retail stores nationwide. Her latest whitepaper “How Mobile Technology is Changing the Retail Environment” is available here.
GMA names VP industry affairs
WASHINGTON — Pamela Bailey, president and CEO of the Grocery Manufacturers Association, has announced the appointment of Jennifer Kaleda as VP industry affairs, operational effectiveness.
"I am pleased to welcome Jennifer Kaleda to the GMA team," Bailey said. "Jennifer comes to us with a strong background in the consumer packaged goods industry, and her work in integrated supply chain management makes her the ideal person to enhance GMA’s role as a leader in facilitating industry collaboration across the entire value chain."
As a member of the industry affairs and collaboration leadership team, Kaleda will be responsible for the operational effectiveness and efficiency initiatives of the GMA value chain optimization strategic platform, while supporting the team’s overall goal of fostering trading partner relationships and collaboration.
Prior to joining GMA, Kaleda was the director of 1SYNC account management at GS1 U.S., in charge of leveraging customer relationships to create awareness, adoption and implementation of the global data synchronization effort.
She also served in management roles with Campbell Soup Co. and Kraft Foods. Kaleda will report to Denny Belcastro, EVP industry affairs and collaboration. She will begin her new assignment on Nov. 14.
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Conference Board survey finds holiday shoppers in frugal mood
NEW YORK — U.S. households are expected to spend an average of $497 on gifts this holiday season, the Conference Board reported. Only 7% of consumers said they plan to spend more on holiday gifts this year, while approximately 49% plan on spending less than last year.
The survey of holiday gift spending intentions, based on a probability-design random sample, was conducted on behalf of the Conference Board in October by Nielsen.
"As the holiday season approaches, we once again find consumers in a frugal mood," said Lynn Franco, director of the Conference Board Consumer Research Center. "With the overwhelming majority of consumers expecting to spend the same or less than they did last year, it’s not surprising that they expect a large share of their purchases to be on sale or discounted."
Four-out-of-10 holiday shoppers said they expect more than half of their purchases to be on sale or discounted. An additional 3-out-of-10 said they expect one-quarter to half of their purchases to be discounted.
Close to two-thirds of consumers expect to purchase a portion of their holiday gifts online, with about 15% saying more than half of their gifts will be purchased online.
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