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Lux Beauty Boutique drives 25pc sales increase with beacon-enabled app

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April 24, 2014

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Lux Beauty Boutique tries in-store mobile payments

Canadian retailer Lux Beauty Boutique upped in-store sales 20-25 percent this year for an anniversary sale thanks to the addition of a self-checkout mobile application.

Lux Beauty Boutique has been using the SelfPay mobile application since last year, and the most recent findings about mobile shopping took place during Lux’s 14th anniversary event on April 12. The in-store mobile app is the brand’s first foray into mobile commerce.

“We have a massive, in-store event and we set very high sales goals, and we have a very small space,” said Jennifer Grimm, owner of Lux Beauty Boutique, Edmonton, Alberta, Canada.

“We hit last year’s sales goal, and then this year we knew that we wanted to do even more,” she said. “The only way that we could smash it and make those extra sales was to have an increased turnover because the lines at the tills were what was slowing everyone down.”

“I can say with confidence [that] absolutely the extra sales goal that we made over last year, which was significant, was attributed to people being able to checkout with SelfPay to get out and allow space for the new people to come in.”

Mobile shopping

The SelfPay mobile app uses geolocation and beacon technology to detect when a shopper is inside a store. SelfPay is a self-checkout app that lets shoppers scan in-store products from several retailers that they can then buy right on the spot.

Sales on the app can be made by either a credit card or through a PayPal account, and there is also the ability to use location-based push notifications.

In addition to mobile orders raking in 28 percent more than Web commerce, the  average mobile order was 17 percent higher than credit card transactions during the anniversary sale.

Additionally,  78 percent of SelfPay transactions on April 12 were made by new users, which is chalked up to the marketing that Lux Beauty Boutique put into the app before the event.

The retailer incorporated the app into all of its marketing for the event, including in-store signage, word of mouth, video and event tactics.

Merchant data
From the merchant side, the technology lets the retailer verify the payment and aggregate the data collected by the transactions to better understand how consumers are shopping in-store.

The idea is similar to the strategy that Walmart is slowly scaling up with its Scan & Go app. Walmart is testing self checkout to eventually cover about 200 stores, and added mobile coupons to the program in August to drive adoption (see story).

Despite the growing number of retailers deploying mobile payments, the percentage of on-device sales remains small for most brands.

Juniper Research estimates that mobile payments will hit $507 billion this year, but highlighted a bigger opportunity  for smartphones to be used primarily for searching and browsing (see story).

To help build the percentage of mobile sales, retailers are looking at how to leverage in loyalty and other incentives to keep consumers to keep using it in-store.

For example, Lux Beauty Boutique gives app users additional loyalty points for using SelfPay to shop in-store.

Additionally, the retailer is using it for up selling and clienteling in its one brick-and-mortar location.

“I think when most people envision self-pay or something similar, it’s for a big box retailer,” Ms. Grimm said.

“For us, we’re a specialty boutique where there’s a high touch,” she said. “What’s great about SelfPay is that it doesn’t interrupt that really great, high-touch experience that you’re having with the sales associate.”

Final Take
Lauren Johnson is associate reporter on Mobile Commerce Daily, New York

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