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Retailers overemphasize loyalty in creating compelling mobile experiences: report

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October 18, 2013

Consumers not as interested in loyalty as retailers think

Retailers that heavily invest in loyalty and neglect to create compelling mobile and online shopping features are missing the mark meeting in-store shoppers’ needs, according to a new report from Acquity Group.

One of the main takeaways from Acquity Group’s “Desktop versus Smartphone: Technology’s Impact on Omnichannel Behavior” report is that some retailers are overinvesting in loyalty while other in-store tactics such as Wi-Fi are being pushed to the backburner. Since showrooming is expected to grow this holiday season, retailers should be focusing heavily on driving online and mobile traffic to their own sites and apps to capture sales.

“Loyalty programs are still an important part of a brand’s marketing and sales strategy,” said Chip Knicker, vice president of Acquity Group, Chicago.

“The study findings demonstrate that while loyalty is important, other factors such as offering price savings upfront outside of a loyalty program and a convenient shopping experience have become more important for consumers,” he said.

Content is king
Being able to shop online and through mobile devices was the most important factor for smartphone owners shopping in-store. Customer service was also ranked as a top priority for in-store smartphone shoppers.

Loyalty programs were ranked as the lowest priority for in-store shoppers.

One of the main ways that retailers have traditionally fought showrooming is through loyalty programs that incentivize consumers to shop in-store. However, the Acquity Group report suggests that consumers are more interested in great online and mobile experiences.

Additionally, a well-organized mobile Web site was picked as the most important criteria for the respondents since consumers quickly browse through a mobile site to find exactly what they are looking for and check-out.

There are also differences by demographic that influence brand loyalty.

For example, younger consumers are more likely to remain loyal to a brand due to price across all channels. Older shoppers are more drawn to customer service.

Mobile's role expected to grow during holidays

Additionally, 73 percent of smartphone owners aged 26-45 years old have bought something via their smartphones.

Acquity Group’s findings point to compelling mobile content as key for shoppers.

In fact, 73 percent of shoppers would be more likely to shop from a brand with editorial content that is customized to their preferences. This includes social updates, news or email.

With a significant portion of traffic coming from mobile devices, there is also a large untapped opportunity around social commerce.

Sixteen percent of consumers have purchased items as a result of being influenced by social media. Thirty-two percent of consumers have not purchased products that are posted on social media but would be interested in trying it.

Additionally, 59 percent of consumers have been influenced to make an in-store purchase after flipping through product images and information.

Sophisticated store experience
Although in-store Wi-Fi is still relatively new for many retailers, Acquity Group’s research finds that the often hefty investments required can pay off for marketers.

Half of consumers surveyed said that they would feel more confident buying a big-ticket item in-store if they were able to research in-store by connecting to Wi-Fi. Twenty percent of the surveyed group would also spend more time in-store as a result of having Wi-Fi.

Additionally, 30 percent would be more inclined to look for additional unplanned items online, pointing to the opportunities for marketers to trigger quick sales through Wi-Fi.

This attention on Wi-Fi feeds into a bigger omnichannel focus for retailers that is becoming increasingly more important as consumers shop from multiple devices throughout the day.

Forty-six percent of smartphone owners would purchase from online more if there was a more consistent experience across different mediums, and 78 percent of smartphone owners look up a retailer’s inventory online before visiting a store.

“Retailers are already focused on a number of the findings in this study, and I do expect that will be evident this holiday season,” Mr. Knicker said.

“An example of that is the focus on content across channels,” he said. “Expect that retailers will continue to embrace mobile devices during the in-store shopping experience, and behind the scenes of that integration is product content. While there will be continued focus on product content in the future, I expect that will start to manifest itself in this holiday season.”

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

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