And while physical stores still reign, online activity influences the equivalent of 36 cent of every dollar spent in them, according to Professor Alexis Mavrommatis, speaking at a seminar by Monash University’s ACRS research unit.
Addressing the convergence of the physical and digital worlds in the retail sector, he said brick-and-mortar stores remained key, preferred by 85 per cent of shoppers.
However, with more channels and the adoption of mobile technology, a switch in preference was only a click away, Peter Wilson from market research and consulting agency Koji says. “That is why a drive to authenticity and generating great customer experiences are critical for physical retailers, while convenience – range, price, availability, fulfilment, return policy – is mandatory for online retail.”
As a result, brands and retailers alike are exploring more and more ways to interact and transact with shoppers through multiple touch points, examples being Amazon in-transit shopping, the Nordstrom app, interactive brand promotions on wearables, click and collect, pickup and drop-off, Westfield mPort and Myer Parramatta Hub.
“We have to embrace digital, no matter what industry we’re in, or what point of disruption we’re facing,” says Target USA CEO Brian Cornell. “We all have to be thinking about digital first – it’s really the innovation that is going to drive the future.”
And the single, greatest enabler to real-time retail and the always-on brand? The smartphone.
We are spending more time on our mobiles than any other device, statistics show that adults view their mobile devices about 265 times a day and youth 387 times a day.
In the UK alone last year, mobile devices accounted for more than half of all online sales and more than two-thirds of traffic to retail websites. There has also been the emergence of online affiliate marketing, which enables consumers to click directly from online content to eCommerce sites.
But is that really delivering real-time retail and the always-on brand? Are we helping consumers shop when and how they want? Of retail sales in Australia, online contributes less than 7 per cent, and 69 per cent of Australians say they prefer to shop in store. As a result, smart marketers are leveraging mobile to encourage shoppers to stores and deliver a better customer experience once they are there.
Mark Felix online trade director John Lewis has described mobile as “the glue between our shops and online”, with customers increasingly using the two channels combined. “For example, they use their mobiles to check ratings and reviews, and for further product information when in store.”
Mobile-friendly digital media can also bond brand awareness and in-store engagement. Special offers can be delivered directly to a specific audience, driving a more-engaged shopper to store, rather than the one-size-fits-all approach currently dominating in-store discounting.
Mobile marketing platforms can provide customer insight directly from the shopper’s personal device. The more knowledge that brands and retailers have about what influences people to visit their store and what they buy, the better they can deliver strategic and tailored promotions and campaigns.
“Data-driven mobile marketing campaigns are proving to not only create a better experience for the consumer, but a higher conversion rate,” Sydney business analyst Andrews Levi says in his article Mobile Marketing: Moving from M-Commerce to In-Store Engagement. He says
this results in a more profitable deployment and spend of advertising dollars for retailers and brands.
One brand embracing the change is Pernod Ricard Australia. Shopper marketing manager Richard Dumas believes the rapid revolution of digital communication has been the biggest single game-changer for the industry.
“As brand businesses, we can have a direct conversation with our shoppers at numerous
points across the path-to-purchase. We can inspire them, encourage them into a store, incentivise them to buy then reward them later, without even having to involve the retailer,” says Dumas.
“Advances in the way we can segment and target shoppers through social and other digital media seem to be coming through almost weekly. All this is allowing brands to once again gain some control over how they are marketed at retail, which makes shopper marketing such an exciting space to work in.”
The brand-engaged mobile marketing platform Shopitize to drive a trial promotion of a new berry-flavoured pre-mix range extension, Absolut Botanik. During the campaign, customers could buy the product in any liquor store across Australia, and send in a photograph of their receipt for a full refund (RRP). Consumer engagement was driven by targeted Facebook advertising. No retailer integration or pack codes were needed, with shopper details and full purchase data captured for use in future marketing initiatives.
The campaign delivered 300 per cent more redemptions combining digital and POS than just POS alone, and was heralded by retailers as one of the best product launches of last year.
“This was a really innovative and powerful trial that helped deliver strong launch results for Absolut Botanik,” says Dumas.
Ultimately, as brands and retailers aim for the Holy Grail of omnipotent, omnichannel, general “omni-ness” in the new technological age, it is easy to forget the fundamental fact that people are still people, and that the key driver of people is emotion.
Lee McClymont is GM of POPAI for Australia and New Zealand. This article appeared in the April edition of Inside FMCG magazine. Subscribe now.