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Retailers primarily use mobile to drive loyalty, not transactions: report

June 27, 2013

A recent survey of 100 retailers by EPiServer found that 46 percent of those with a mobile strategy in place and 74 percent of those planning to launch one soon say they are using mobile primarily to increase customer loyalty or provide a more personalized experience for customers.

In comparison, only 8 percent said they use their mobile strategy for sales. The findings suggest that as ecommerce giants such as Amazon and eBay make it difficult for other retailers to compete on price, they are leveraging mobile to differentiate themselves through convenience and brand loyalty.

“The big news for merchants revolves around where they’re going to be seeing the greatest ROIs from their mobile strategies,” said Bob Egner, vice president of product management at EPiServer, Oakbrook Terrace, IL.

“The survey shows that mainstream retailers are reaping the greatest rewards from their mobile strategy through greater customer loyalty and personalization,” he said. “This valuable engagement really highlights the focus needed on customer experience across channels.

“The volume of transactions made with mobile devices is lower than what might have been expected from various reports and hype about exploding mobile e-commerce.  Most respondents indicated that mobile transactions are a smaller part of their mix than what we hear about from retailing giants like Amazon and eBay.”

Positive experiences
While the volume of mobile transactions are growing, they currently still make up a relatively small percent of sales, with only 22 percent saying that mobile transactions account for more than 20 percent of their sales, up from 16 percent last year.

For pure-play online retailers with a mobile strategy in place, 60 percent said mobile transactions account for less than 20 percent of their sales while 40 percent said that mcommerce makes up between 20 percent and 40 percent of sales.

The findings suggest that except for retailers such as Amazon or eBay, mobile transactions are not the primary driver of return on investment for retailers’ mobile strategies.

Instead, retailers are realizing a higher return and an increase in repeat business when they focus on providing a positive mobile experience that fosters loyalty and convenience instead of on building out a complex transaction model.

Transcending price
Other key findings include that 35 percent said that their greatest investment in the next three to five years will be in mobile, up 11 percent from 2012. In comparison, the number saying social will be their biggest investment fell 17 percent and came in at 5 percent.

However, 60 percent said their Web site will be their biggest investment.

When asked who they think is most effectively using mobile to increase customer experience and the user journey, 22 percent said Amazon, 9 percent pointed to eBay, 2 percent named Facebook and 2 percent favored Starbucks. The remaining 65 percent fell under the “other” category.

“The message is clear – focus on the customer, their needs and the journeys they take while interacting with your brand,” Mr. Egner said. “There is a real opportunity to differentiate on experience and relationship that can transcend price in the decision making process.”

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

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