77% of Americans own cell phones according to this Pew center report. Their size makes them convenient to carry along at all times, making them available whenever needed. It was inevitable that shoppers would begin turning to their smartphones to find products and learn more about them. In a recent survey, the National Retail Federation (NRF) found that 43% of consumers plan to use their smartphones to find back-to-school items and compare prices. Only about one-fourth plan to make purchases on the smartphones, but plan to use them in other ways while they shop.
How back-to-school shoppers are using mobile phones
Mobile phones are playing a very large role in back-to-school shopping, with 43% of shoppers planning to use their smartphones to find information on products or compare prices. When looking at Millennials, nearly 60% say they will use their smartphones for back-to-school shopping.
In another Retail Dive article, 58% of back-to-school shoppers plan to use their smartphones to compare prices. Meanwhile, another 38% check for item availability. 30% are more likely to order online with in-store pickup. Most shopping is still done at brick-and-mortar stores, driven by the convenience of one-stop shopping.
Retailers, take notice: 40% of shoppers don’t start shopping until they see the promotions that are being offered by retailers. Just under 90% of shoppers surveyed also said that promotions impact how much they spend and what they buy. Smartphones provide retailers with the opportunity to advertise discounts, coupons, and in-store offers directly to consumers as they shop. After a severe beating in the market, JC Penney has learned the value of incentives. The 115-year old retailer is developing a cross-channel shopping experience that includes mobile as an important part of the partnership between e-commerce and its physical stores.
Shoppers aren’t using mobile phones to just find out what their kids need to go back to school; 39% use smartphones to download digital coupons and 30% like to take pictures of the items they’re shopping for, according to the information from Retail Dive. Digital coupons provide a convenient way for shoppers to take advantage of promotions without clipping coupons and bringing them to the store. Pictures are easy to share and help shoppers make buying decisions. Pictures can also include a recommendation when shared on social media and can be sent to extended family and friends.
Mobile apps
Retailers who want to connect with shoppers should take a closer look at mobile apps that make the back-to-school shopping experience even easier and more convenient. Mobile apps can a be the key driver of foot traffic in stores. Apps can also be a driver of sales. In the same Retail Dive article, Kate Coultas, a J.C. Penney spokesperson said, “Our app users are valuable customers, making three times as many trips to our store and purchasing 3.5 times more than (sic) non-app customers.” The increased sales from apps aren’t lost on the other retailers, she added. Amazon, Target, Walmart, and other large retailers are working on ways to improve their apps to make shopping easier for the customer.
To Mobile or not to Mobile
61 % of Millennials and 56% of Gen Z value mobile apps. For retailers looking to get a bigger piece of the back-to-school shopping pie, mobile apps may be the key sales driver for the younger generations who will be shopping this season.
Social media is an important part of the strategy, especially when it comes to the younger generations. 50% of Millennials and 42% of Gen Z value social media. Retailers need to consider this while developing ad campaigns and incentives for back-to-school shoppers.
To truly succeed at mobile, retailers need to create an end-to-end, mobile-friendly buyer’s journey. This includes several components, each of which needs to be optimized for mobile:
- Social media presence with content, ads, and promotions that funnel shoppers to the retailer’s website or app
- An app that provides a smooth buyer journey from product search to purchase
- An app that loads fast (less than 3 seconds)
- A website that is easy to navigate and use.
- Discounts, coupons, and offers that are easy to understand at a glance and easy to use
- POS capabilities that automatically apply qualifying discounts at place of purchase
As consumers become more comfortable with sharing their personal information, retailers will benefit. In-app mobile payments increased by 57% from last year. This opens up possibilities for retailers to show shoppers targeted content and offers in different apps, thereby driving more traffic and sales.
Popular shopping apps
Apps like Shopkick, The Coupons App, and DealNews make it easy for shoppers to find the best coupons, discounts, and deals on items. Retailers who provide apps with similar capabilities may find that they attract more customers directly instead of through a third-party shopping app. Making your coupons and other incentives easy to find and compare with the competition makes it easier for the shopper to choose the best deal (secret tip: you can always make sure your deal is the best). When customers see that your store offers a transparent comparison of incentives with similar items from other stores, they’ll likely see your store as the better one to shop at.
Changes in viewing behavior
Larger changes in consumer behavior are also potential opportunities for retailers. Conventional radio and TV programming (including cable) are losing out to streamed media. YouTube, Spotify, Netflix, and others are mainstream, with a growing number of consumers abandoning cable altogether. This presents a dilemma for retailers who have decades of experience in advertising through broadcast radio and broadcast or cable TV.
Streaming media is an opportunity for stores to engage consumers with fresh, smart advertising campaigns. In fact, Dallas Lawrence, the CCO at Rubicon Project, says, “Smart brands are going to be embracing a very comprehensive advertising strategy over the next two months to capture the billions of dollars these parents plan to spend online and on mobile getting their kids ready for school.”
However, it’s not as easy as it might at first seem. Streamed media is fundamentally different from traditional TV and radio – consumers are deeply annoyed by ads that interrupt their experience and will quickly abandon a service that pesters them with too many ads. A lot of experimentation is going on in this area as retailers try to figure out how to reach consumers without affecting user experience.
In-app Advertising
To gain more customers, retailers may need to consider advertising on popular apps and games.
Certain types of apps may lend themselves more readily to advertising. Kohl’s has taken the lead with its Kohl’s: Scan, Shop, Pay, and Save app, with a 59% increase in mobile conversion rates, according to this article in Retail Dive. Kevin Mansell, Kohl’s President and CEO, says, “Our Kohl’s app was used by more than 11 million customers and growing…Our digital and mobile-centric Yes2You Rewards Program has quickly become an industry-leading loylaty program.”
Mobile games are a channel that retailers should consider. Retailers have the opportunity to reach shoppers through the games they play, especially games such as Clash of Clans and Candy Crush.
What This means for retailers and advertisers
Smartphones are with us virtually every moment of the day, making it convenient to quickly find an item, compare prices, and check its availability. Changes in consumer behavior are presenting new challenges to retailers, and many of them have to still really figure out the whole digital thing. Advertising on mobile is new enough and retailers haven’t completely understood it yet. The complex relationships between channels in mobile make it particularly difficult to fully grasp advertising. If anything, mobile has shown us how interconnected everything on the internet really is, and how difficult it is to sort all of that out and understand it.
Meanwhile, the pressure is on retailers to embrace fundamental changes in consumer behavior and to develop advertising strategies around them. Shoppers are using social media, streamed media, and mobile apps as they journey from finding products to purchasing them. Advertisers need to create a cross-channel experience for shoppers that seamlessly guides them toward purchasing the items they want. Stores that provide a one-stop shopping experience continue to present a significant challenge to retailers that primarily offer clothing and accessories. To compete, clothing retailers will need to draw the attention of shoppers and convince them that the extra trip is worth it.
Retailers who ignore social and streamed media will lose valuable Millennials and Gen Z customers who choose to shop at stores that engage them through those channels. A similar fate is all but guaranteed for retailers with poorly developed advertising strategies. In the digital age, annoyed customers quickly abandon brands that don’t ‘get’ mobile and social media.
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