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Retailer investment in mobile begins to level out: BDO

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February 15, 2013

With mobile engagement becoming a cornerstone of retail operations, 60 percent of retailers are planning to maintain their investment levels in mobile for 2013, while 38 percent plan to increase it, according to a new survey from BDO.

For a similar survey conducted by BDO in 2011, 54 percent of retailer chief financial officers were planning to increase their investment in mobile while 44 percent said the level would stay the same. This year’s results suggest that retailers’ investment levels for mobile are beginning to level off as they begin to focus more heavily on what is working and stepping away from what is not.

“I was expecting more than 38 percent would increase their investment in mobile,” said Stephen Wyss, a partner in the Retail & Consumer Products practice at BDO, Chicago.

“Retailers are coming off a couple of years of significant investment in mobile, and I think it has stabilized in terms of the investment,” he said. “The focus now is on how better to leverage the investment.

“Retailers are beginning to understand what is working best and what is not working as well. Retailers are becoming a bit more savvy in how to use mobile.”

Omnichannel shopping
Retailers continue to look for ways to integrate mobile and create an omnichannel shopping experience, ranging from installing mobile technologies in their stores, such as with in-store GPS and apps, to developing mobile shopping apps.

Other key findings from the annual “BDO Retail Compass Survey of CFOs” report include that 33 percent of CFOs say email and social media promotions were their most successful promotional activities during 2012.

With mobile playing a big role in how consumers access both email and social media, the success of email and social media promotions suggests retailers are getting a handle on how to optimize their promotional activity for mobile.

Additionally, 29 percent said advertised promotional deals were their most successful strategy.

In terms of the least successful strategy, 41 percent of CFOs cited extended store hours. This suggests that as consumers increasingly turn to mobile devices to complete their holiday shopping, strategies such as extended hours are playing a smaller role.

“Thirty-three percent said email and social promotions were most successful in 2012 – mobile ties into that,” Mr. Wyss said.

“The optimization of email and social for mobile is a key strategy for retailers going forward,” he said.

“When you look at how many did not think extended hours were particularly effective, the reason why is the success of mobile.”

Retailers are also likely to focus on leveraging mobile to get instant feedback from consumers.

Better customer experiences
Overall, retail CFOs expect a 3.2 percent increase in-store sales this year, down from 4.5 percent last year.

However, CFOs expect a bigger increase for ecommerce sales, with retailers on average expecting a 6.9 percent increase in online sales in 2013.

In 2013, retailers are likely to focus on enhancing and optimizing their ecommerce channels for mobile to capitalize on how more consumers are shopping online.

“Across the board retailers are looking at mobile as an important way to stay connected with their consumers and to keep consumers up to date from a promotional perspective,” Mr. Wyss said.

 “Mobile is very much a large part of consumers’ daily routines and is becoming a much larger part of how they shop,” he said.

“Mobile is only going to become more of a focus as we see the technology improve, the screens get larger and the optimization technology and tools get better. The consumer experience is only going to get better and that will drive more traffic and sales.”

Final Take
Chantal Tode is associate editor on Mobile Commerce Daily, New York

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