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Retailers used to be worried about ‘showrooming’ – when customers would look at merchandise in-store, but buy it cheaper online. But now they are developing new apps to help buyers navigate their way round the store.
GameStop has no doubt that mobile devices have changed the way its customers shop. Smartphones and tablets now account for up to 68 per cent of the traffic to the US video-game chain’s website, where customers are frequently browsing products and looking up trade-in values for their old games.
One thing they’re not doing much of on mobile devices? Buying stuff.
In fact, “purchasing through that phone probably wouldn’t even make the top-10 list of engagement activities,” said Jason Allen, the retailer’s vice-president of multichannel.
GameStop’s experience reflects a trend throughout the industry: while there has been a surge in traffic to retailers’ websites from smartphones, a proportionately big boom in sales on these gadgets has yet to materialise. In other words, for all the time we spend swiping and tapping on our phones, we still aren’t particularly willing to make purchases on them.
Instead, shoppers are largely using their phones as something of a personal, pocket-size sales associate that helps them browse and research while they are in a shop. That has prompted retailers to adapt their mobile strategies to help them do something counterintuitive: boost in-store sales.
“We’re not overly focused on conversion on mobile,” said Krista Berry, the chief digital officer of the US department store chain Kohl’s. “We really see it as a tool to drive traffic in our stores.” Conversion is an industry term for when browsers become buyers.
At Kohl’s, executives say they have spent the last year and a half updating their app, in part to accommodate in-store shoppers who are more frequently searching for product reviews, watching video content about merchandise and sharing their finds on social media. When customers are in Kohl’s stores and on the retailer’s wi-fi network, customers spend more time on the app than when they’re not in the shop, company officials said.
These behaviours have led the company to develop a new “in-store mode” for its app, in which users who walk into a Kohl’s store will be asked whether they want to use a special version that is tailored for wandering round the shop. Kohl’s declined to say how the in-store mode will be different from its regular app experience but said it would be available in September.
The big-box behemoth Target is also catering to shoppers who use their phones to guide them through stores with a relaunched app; it has a tool that helps build a weekly shopping list and an interactive map of each location.
It’s easy to see why the company has moved in this direction: since it installed free wi-fi in its outlets a few years ago, Target has found that the most visited site, by far, is the retailer’s own website.
This enthusiastic embrace of in-store phone use might have seemed unthinkable in corners of the retail industry only a few years ago, when many bricks-and-mortar chains were panicking about “showrooming”, the industry term for when shoppers would go to a shop to check out merchandise, ultimately only to buy it online for a better price. But that fear has largely dissipated, as study after study has shown showrooming is not a huge threat. In fact, several studies have found that the opposite behaviour – browsing online before buying in a physical store – is more common.
Data from the Christmas holiday season provides additional evidence that we’re often in research mode when we’re on our phones: during November and December, smartphones drove 31.2 per cent of total US traffic to e-commerce sites but accounted for just 9.1 per cent of online sales, according to IBM.
This climate has not only pushed retailers to change their game plan, it has also drawn technology start-ups into action.
StepsAway, for example, is a mobile website that lists all the sales at a given shopping centre, which shoppers can access when on the mall’s wi-fi network. Retailers have the option of using it to offer special time-sensitive sales, such as a two-hour deal for 20 per cent off on cashmere sweaters.
With all of these in-store mobile strategies, one of the biggest challenges is designing an on-screen experience that works for a wide variety of shopping trips. At Whole Foods, app users who aren’t time-pressed can dig into the treasure trove of product information that shows ingredients and details about where a product came from.
But they are also experimenting with ways to engage an in-store shopper in a hurry, with a feature that allows users to order coffee, sandwiches or charcuterie as soon as they step over the threshold.
“One of the things that I think this will do is not only speed up the process by which the customers can get in and out of the store, it allows them to not spend time in line,” said Jason Buechel, the chief information officer at Whole Foods.
Even as companies bend to the reality that shoppers, for now, are not buying many things on their phones, they haven’t given up on finding ways to make a small-screen sale. Facebook, Twitter, Instagram, Google and Pinterest are all experimenting with their own versions of a “buy” button, a one-click way for users to make a purchase without leaving their apps or having to go through the cumbersome process of entering credit card numbers or other personal information.
But these nascent efforts have been met with some scepticism.
“Merchants who are intrigued by these offerings are wise to test and learn, but to have low expectations,” Sucharita Mulpuru, an e-commerce analyst with Forrester Research, wrote in a recent blog post.
That’s because, Ms Mulpuru said, there are plenty of potential challenges to adoption. On Twitter and Instagram, for example, users see the most recent posts in their feeds, meaning if they aren’t logged in at just the right moment, they have little chance of seeing the “buy” button. Pinterest, on the other hand, is full of images of old merchandise that is no longer available for sale, which could be confusing for users who are ready to spend.
Source: The Independent