11 April 2011: At the first Retail Business Technology Expo at Earls Court, The Logic Group hosted the only in depth discussion with retailers on some of the major topics of the day; mobile commerce, social media and loyalty in multi channel retailing.  How do they implement and measure mobile retailing and how, as retailers, do they keep up with a market that is changing so fast?  The group represented a wide span of the retail market, from coffee shops and clothing chains, to luxury department stores and online traders; so what does mobile mean to retailers?

The delegates discussed how mobile is more about the people using it, rather than the technology itself.  The advent of smartphones has transformed the face of multi channel retailing, whilst bridging the gap between high street store and online channels.  Retailers want to be able to interact with their customers, and vice versa, at any time, in any place and through any connected device; both instore and online.  Instore, smartphones and apps give customers access to a wealth of information from the palm of their hand; from price checks, store locators and offers, to reservations, research and ultimately, payment. 

There was however, a warning that mobile has changed the mindset of not just consumers but staff alike.  If staff know that a customer is going to check online and buy elsewhere, they are perhaps less keen to engage and deliver a good service. As a result, some retailers commit to matching genuine online prices, which at the very least motivates their team to keep selling and serving. It was agreed that some retailers could defend their prices based on the quality and service offered instore, while others would lose out and may be forced to shift sales to cheaper channels online.  Retailers do want, and need, to embrace multiple channels but are keen to avoid disintegration of experience and branding.  The conclusion? Mobile needs to be part of, and consistent with, the multi channel experience.

So is it all over for the high street store?

There’s no doubt that online is the fastest growing area of retail, now accounting for as much as 20% of sales in some sectors; and as such, the future of the high street store is under the spotlight.  While customers may visit a store to make their first purchase, once they’re happy with the look and feel of a product, the second time they might choose to buy online. For many retailers, the challenge is to ensure that their store remains an attractive and rewarding place - not only to visit, but to buy.  Some retailers have turned their larger stores into brand cathedrals, using these to both support the brand and drive sales through whichever channel the customer chooses.  Whilst for others, reaching out to customers online and via mobile is more about communication than fulfilment and payments; but these communications can still add value to the process and lead to sales.

So how do retailers measure the return on investment in mobile commerce?  The process is not yet clear, but there is no doubt that customer engagement is critical. Beyond that, retailers are looking for up sell and cross sell opportunities instore, which means that they need to know their customers. Near Field Communications (NFC), now feature on a growing number of smartphones, and should enable retailers and customers to connect as soon as a customer enters the store; allowing them to receive personalised messages, loyalty points and offers direct to their smartphone.   One retailer was intrigued by the possibilities, saying that they would even consider proximity deals if they had an empty restaurant to fill, or send e-gifts to customers on Facebook to prompt visits. In return this interaction should drive customer feedback, allowing retailers to tailor offers and engagement to individuals.

Social Networking – the wisdom of the crowd?

Social media is seen as an invaluable tool to tune into what consumers are saying; both good and bad.  The general consensus from delegates was to listen to the bad, not screen it out.  Retailers should join the social conversation on an equal footing with their customers; it is a space for retailers to be honest about their own shortcomings – remember news travels fast and attempts to keep the lid on bad news is likely to backfire – address it head on and defuse negativity before it spreads.  Interestingly none of the retailers regarded the channel as one for sales, but more about tuning in and responding to customers.

Mark Kusionowicz, Marketing Director, The Logic Group, summarised the discussion: “As a counterpoint to all the hype over mobile technology, the delegates, whilst excited at the possibilities, all wanted to understand the likely return on investment, the willingness of customers to use new technology, and how this could look instore. For online retailers, with no concerns over store footprint, it was more about interacting with the customer and adding value. This was also true for high street retailers, but they were more concerned with how to drive store traffic and to make the store an attractive and rewarding environment. Social media is generally regarded as a positive way to interact with customers to get high quality feedback, which in turn can be implemented to improve the shopping experience, customer service, store layout and to achieve the right balance in the on and off line shopping offer.  Ultimately, loyalty in the future is likely to centre on being tuned into the customer, enabling the retailer to react much more quickly to their needs.”

For further information, download the full report ‘Take control of your customer interactions - trends in mobile retailing’.