Tag Archives: Retail

Touch Me, Feel Me

I was cleaning out some old stuff on my computer this morning when I came across a receipt for something I had purchased online in 2005. I knew I had been an online shopper for a long time. I can’t recall the last holiday season during which I stepped foot into a retail store. I mean, I don’t like to so shop for anything on the weekend due to crowds and lines so I’m rarely in a physical store between Thanksgiving and Christmas.

Given the explosive growth of online commerce, apparently many other folks prefer not to hit the stores either. I mean, the share online represents of global retail sales has almost doubled from 2015 to 2018, and is projected nearly to triple by 2021. It’s booming! That said, online is still less than 15% of retail and will be less than 20% even 5 years from now. There’s a reason for that and it’s not just shipping costs or the difficulty in finding a product.

Most people – almost 75% according to a recent study – visit stores to touch and feel products. If you’re browsing and come across an unfamiliar brand of shoe or clothing, how comfortable are you buying it without examining it for quality and fit? I’m certainly not, and I share that feeling with the vast majority, apparently. Sure, the return process isn’t as difficult as it used to be with many online stores, but who wants to deal with it? I want to see the product, which I can do on or offline, but I also want to feel it, touch it, and check it for quality.

That’s a significant advantage that brick and mortar stores have, one that they should exploit to keep market share. They can merchandise product in a way that online stores can’t. They can use in-store displays. More importantly, as we’ve said many times here on the screed, they can offer a level of personalized customer service that no online store can offer.

Try it yourself. Before you go on a shopping trip, hit the store’s online presence first. See if the two experiences are equal. If the retailer’s physical presence is doing things right, there won’t be a comparison. Shopping for a golf club or a bat or a racquet online at Dick’s Sporting Goods is nothing like going to my local Dick’s store and swinging it. I can browse through a lot more books in a shorter time at my local Barnes and Noble vs. their online store. I’m on my own online. There are pros in golf and tennis to help me in-store.

I don’t think brick and mortar is dead, not by a long shot. I do think stores will fail if they don’t take advantage of the built-in advantages they have. Cutting staff, not investing in merchandising, and simply becoming warehouses where people pick up their online purchases won’t cut it. Does that align with your thinking?.

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Is Creepy Dead?

I’ve had beacons on my brain lately.

Start Point Lighthouse, in the south of Devon,...

(Photo credit: Wikipedia)

I’ll explain what they are and why in a second but they raise a larger question in my mind, which is our topic today:  has the “creepy” factor left us?  Not long ago, the notion of someone, much less some business, tracking our every move and approximating what we’re thinking would be…creepy.  Have we become so immune to the fact that said tracking occurs almost constantly caused us not to even care any more?  Let’s see what you think.

First, why beacons and what are they?  Here is a good explanation:

Beacons are devices that communicate with a shopper’s smartphone in the hopes of improving the in-store shopping experience. When placed in a store, beacons use Bluetooth technology to detect nearby smartphones and send them media such as ads, coupons or supplementary product information. They can also be used as point-of-sale systems and to collect information on those consumers — particularly how consumers maneuver through stores.

Who you are, what you’re looking at, where you go and how frequently you shop there are all part of the equation.  Maybe not so awful.  A store with an attentive staff can generally say the same about any regular customer and the information delivered about a product should be more complete than any clerk can remember across hundreds of products.  Many stores use cameras to do just that.  Apple, of course, is in the forefront of this with their iBeacon.  It’s built into every device – iPhone or iPad – sold in the last few years.  They recently deployed the technology in all of their Apple stores:  what they set up uses the Bluetooth technology of the iBeacon to detect where a shopper is within a store so Apple can send location-specific product information to his or her Apple device.  Helpful or creepy?

That’s one example.  Combine the beacon with an app and it becomes simple to send targeted messages to devices.  For example, at a sporting event, you might get messages providing discounts on concessions and merchandise or maybe even seat upgrades if you’re a VIP.  Of course, in the process a lot of information about you is gathered.

So back to the question:  is it creepy or don’t we care?  If we use credit cards, our purchasing habits are known.  If we use an in-store scanner at the supermarket, how we wander the store is recorded along with what we buy even as we’re offered coupons and discounts.  Is the prospect of a better shopping experience worth giving up yet another remnant of our privacy?  Amazon and other retailers know how we wander their virtual stores via click-tracking.  Why should physical outlets be disadvantaged?  More importantly, when the online experience can be mirrored and continued by a retailer’s brick and mortar store, doesn’t the shopper benefit?

I don’t know how many iPhone users know they have this technology in their pockets already.  I don’t know how many people realize what they’re giving up when they opt-in to this technology.  Google has deployed something in newer versions of Android that will allow retailers to bid on serving ads to people conducting product searches and Google can then track the person via their phone to see if they visited the store.  I do feel that many wouldn’t be quite some comfortable if they knew all this.

Are you, or is creepy dead?

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Love The One You’re With

One of the trends I hear discussed all the time is that of chasing the next shiny object.  As it turns out, that’s not something that occurs solely in the tech space.  A recent study from Adobe – The Adobe Digital Index – shows that online retailers are ignoring the 80/20 rule by ignoring current customers in favor of attracting new ones.  Maybe today’s screed should have been titled “You Always Hurt The One You Love.”  Their summary:

Online retailers spend nearly 80% of their digital marketing budgets acquiring shoppers (new visitors), but does this focus make sense? To find out, Adobe Digital Index analyzed 33 billion visits to 180 online retail website in Europe and the United States from April 2011 to June 2012. Our data indicates retailers should shift spend to returning and repeat purchasers, two existing customer segments that drive a disproportionately high share of revenue, exhibit higher conversion rates, and really step up in the Christmas holiday season and tough economic times. Migrating just 1% of shoppers to returning purchasers could generate as much as $39 million in additional revenue per retailer.

In other words, we’re spending way too much time and money chasing new customers while we ignore a lucrative user base that’s just waiting to be asked to the dance.  40% of revenue for online retailers comes from returning or repeat purchasers, who represent only 8% of all visitors, according to the study.  In other words, you have to attract five to seven shoppers to equal the revenue of one repeat purchaser.

Having run an online retail business I can tell you that the vast majority of our thinking was about attracting and converting new customers.  It wasn’t as if customer service was an afterthought and we did allocate a good deal of our marketing to up-selling our existing customer base.  However, this study opened my eyes to the fact that we probably could have done more with those who’ve already demonstrated a desire for our products and I’ll keep that in mind as I work with clients going forward.  How about you?

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Showrooming

There’s a relatively recent phenomenon called “Showrooming” that’s becoming a concern for retailers.  In a nutshell, this is the practice of some consumers of going into a physical store to do research and then making the purchase elsewhere, generally online.  Given today’s technology, those purchases can even happen in the store via a mobile device.  A piece from eMarketer quoted a couple of studies that found this is not a hypothetical problem for retailers:

Several researchers have surveyed the number of US mobile phone users who have comparison-shopped via phone while in-store. Their research has found a comparison-shopping rate ranging from 59% of US smartphone owners (InsightExpress, 2011) to 25% of US mobile phone owners (Pew Internet and American Life Project, January 2012).

ForeSee Results findings from between 2009 and 2011 are consistent with this trend toward using mobile phones for in-store research; however, in 2011, the shoppers surveyed were more likely to access the website or app of the store they were actually in than a competitor’s website or app. This means that retailers need to not only be concerned about how their pricing stacks up against others’, but also about pricing consistency across their own channels.

This is sort of the same issue faced by music companies who are trying to sell physical media like CD‘s while enabling the purchase of the same product through digital channels.  The retailers need to differentiate themselves in ways that make doing business with them valuable beyond price.  Customer service, ease of returns, unique merchandise or unique offers are all areas that can be differentiators.  Target has reached out to vendors to do just that, and others are as well.

So the question to you today is this:  what are you doing to make sure that your business is different?  We can go back to the old advertising saw of the  Unique Selling Proposition – as we find in this space a lot, everything old really is new again or at least wrapped in new tools.

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Looking Past Preconceptions

Let’s play a little marketing game this morning.  I’ll throw out a series of facts and you put on your marketing hat and decide if the facts make you want to target this group.  The point I’m going to make is that the answers may surprise you, not because you will find them unbelievable but because I’m betting that you have some preconceptions which will skew your thinking.  As we’ve discussed before, I think that is a huge problem in business (and in life and political thought as well!).

Ready?  Let’s play! Continue reading

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Invisible Customers

Whole Foods | Austin, TX

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The Mrs. had an interesting experience this morning. A new Whole Foods opened up nearby and after running some other errands she went in to shop on the early side. In fact, she was just about the only customer in the place.
As she walked in she sensed a different kind of energy and asked a staff member if something was going on. It turned out that something was indeed going on: a visit to the new store by the corporate CEO and other higher-ups. And that’s when the interesting experience began. Continue reading

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