Over the last ten years online and offline shopping were two separate worlds. Due to the rise of the Internet of Things and e-commerce (particularly mobile e-commerce) the distinction between online and offline has blurred. Since the early days the Internet has allowed retailers to connect with potential customers and express their brand in entirely new ways. Physical stores now have become an integrated part of a retailer’s overall communication and sales strategy, instead of being the only or primary way to reach out to consumers.
Nowadays, technology also has become an integrated part of a customers buying journey because they use mobile devices over and over, since they are convenient and personal. They enjoy using their laptop, tablet or smartphone as a tool to get information, receive e-mails, stay tuned in on social media channels or do their online shopping through store applications and webshops. How is this trend developing? Which devices do they use more often to buy online, and do smartphones have a dominant role in the buying process at all? These are some of the questions we will answer in this article.
The evolution from desktops and laptops towards smartphones
In the past consumers were used to shop in physical stores and look at, or get attracted by, showrooms. These shops offer them sales assistants, the opportunity to change the garment (color or size) and the choice to pay for their purchase by cash or bankcards. Nowadays though consumer shopping has changed permanently.
The Internet has transcended traditional shopping into an innovative and more convenient era called “e-commerce”. Shoppers are gaining tremendous global benefits from purchasing goods and services via the web due to the simple reason that webshops are always open (24/7). They also allow consumers to have all kinds of goods available (large or bundled inventories) so their shopping experience got a lot more efficient.
According to a recent survey, conducted by Globalwebindex the devices people use most to shop online are:
- 91% PC or laptop
- 80% smartphone
- 47% tablet
- 37% Games console
As the path to online purchasing is growing increasingly consumers are becoming more demanding when it comes to the visual experiences and their need and for “high quality” screens and content. This is seen as of major importance when it comes to ease of use and convenience. For most people their mobile screen is their primary screen but definitely not the only screen they use. It depends on how much time we spent at our jobs, home or leisure activities and certainly on the affinity we have with the technology.
Let us take a look at an example:
Tesco Company decided to create virtual stores at the subway of Korea. The idea was to let the store come to the people. Thus, potential customers had the opportunity of buying their daily products on their way to work or home, as they do in an actual store. The slight difference is the fact that customers use their smart phone to shop by scanning the QR code.
The products that were selected got added to their shopping list automatically, and paid for online. Afterwards, Tesco delivered the products to the customers giving them the chance of relaxing home and not waiting in the queue of a supermarket.
In this example it is obvious the evolution of retail marketing but also the use of smart phones in digital and online shopping. They would not have 130% increase in their online sales, if they did not take into consideration that consumers use their mobile phones frequently in every moment of their life compared to desktops or laptops, which are less convenient to carried with.
Omni-Channel Customers: an Emerging Retail Reality
People who combine online shopping, mobile shopping and in-store shopping are known as “omni-channel” customers and are even more valuable. Retailers strive to reach their clients wherever they are, on whatever device they may be using (mostly smartphones) and whenever they can. Most of the consumers already conduct their research in-store with their smartphones and see them as their new, personal, shopping assistant.
To engage with omni-channel shoppers retailers need to understand who their customers are. At a basic level, this means knowing important factors about the client such as their gender, demographic details, location, browsing habits, search habits, and shopping activities. But how can they reap the revenue benefits of omni-channel shopping? Only if they recognize the consumer in question and pinpoint his or her behavior. To achieve this they require a deep knowledge of they way how shoppers behave. To some extent, this can happen with the heat maps. Through various technologies (p.e. camera’s or WiFi) retailers track what their customers touch or ignore and where they mostly walk. This definitely indicates that retailers are interested in knowing what the road is towards a purchase, and not just what the actual purchase is.
Some success stories that have emerged in the retail market are those of Macy’s and Sephora. Let us take a look at the way in which Macy’s combines their on- and offline channels. They start building a strong relationship with customers since they connect the in-store inventory with their website. So, they can upload online the desired product (color and size) and then they inform their client where it is now available. As a result, Macy’s achieved to invest its marketing budget effectively enhancing entirely the customer experience.
Another frontrunner in the world of omnichannel retailing is Sephora. They have succeeded in aligning their on- and offline channels effectively and are boosting sales and loyalty via personalized alerts and their highly effective loyalty program. Their customers are able to receive offer alerts via their mobile device while being in a physical store without missing the chance of trying the (skincare) product. In the meanwhile the always have their own personal shopper at hand via their smartphone. Sephora in the meanwhile harvest vast amounts of data and behavior trends that helps them to combine the total experience and use it as a holistic entity for their customers.
Online shopping and Inventory
Online shopping is rapidly growing and it yields incredible benefits. Using mobile apps, (guest) WiFi, Bluetooth and iBeacon technology retailers can track the movements as well as the preferences of their customers. Accordingly, if the consumer purchases online, the store has already obtained the browsing history and purchasing history. Therefore, the store is able to send personalized offers, deals and discounts as they identify someone nearby. Sometimes consumers use their mobile device during the shopping process for idea generation or inspiration, especially women who are considered as indecisive consumers.
Today’s omni-channel customer expects a seamless shopping experience. For the retailer this leads to more sales and loyal clients. To achieve this, the store needs an organizational structure and close cooperation between online and offline (in-store) marketing teams. On the other hand one of the main issues of online stores is the handle of stock. People order their products online and get them to delivered at their home or work. The problem that occurs quite a lot is that in case of a non- suitable product there are a lot of costs and effort needed to return or exchange the item. Hereby underlies the likelihood of non-return product or non-combined channels (if a retailer offers in-store pickup).
Retailers that offer in-sore pickup will have to inform the consumer in advance that the product cannot be exchanged at the pickup point. They should always check their inventory and interact with their customers about alternative delivering solutions.
Retailers need to have the right metrics in place to act in the best way; an omni-channel mentality is key to enhance the customer experience. The more options you give a consumer the more satisfied he or she is, which increases loyalty and repetitive purchases creating more revenue next to a higher level of customer satisfaction.
Offline or Online Shopping?
A majority of people prefer having the option to shop in physical stores because they need to touch, see and try the product in ways that they cannot do online. Afterwards some of them tend to purchase online (showrooming), avoiding the queue in the store or visit the physical store only to take their purchases. In the opposite, there are consumers who prefer seeing the product online first (webrooming), making their shopping research and then visit the physical store to buy the product.
Either way these consumers have an omnichannel experience and that is why at Evolve Mobile we define them as “Hybrid Consumers”. The group of people using only one channel (pure offline or pure online) is very small and decreasing rapidly. Retailers should realize this and up their game in both the online as well as the offline department to engage and communicate with their (potential) customers.
In our opinion it is now time for retailers to bring the online and offline shopping experiences together. The consumer needs to combine information in order to make the right shopping decision. It is a great challenge for retailers to create a multi-channel shopping experience that answers this need. If they achieve to create a seamless path between all different channels they would effectively extending the front door of their store to their consumer’s smartphone. Eventually they will increase both on- and offline revenues while enhancing the shopping experience of their customers in the meanwhile.
At Evolve Mobile we are experts in building the bridge between a great on- and offline experience, tailoring to the needs of both retailers as well as their customers. In our opinion the mobile channel is perfect to achieve this and we would be happy to help you with your challenges and offer you the right solutions. If you are interested in talking to us feel free to reach out and connect, so we can introduce you into the right solutions.