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How and why consumer mobile engagement is constant throughout the day

November 20, 2011 By Leave a Comment

By Erin (Mack) McKelvey

On Oct. 12, I spoke at the “Future of Marketing” event in Tyson’s Corner, VA. As the sole representative of mobile on the panel, I attempted to focus most of my remarks on the massive shift in consumer behavior we have seen over the course of the last two to three years.

From time of day to the places where consumers are engaging with mobile, it is an exciting time for advertisers to get creative with mobile.

Adds up
 Many of our advertisers ask us if there is a peak time or more preferable time to serve their mobile ads. The answer is yes and no. It really does depend on their campaign goals.

 

Mobile activity throughout the workday, unlike other traditional media channels, is constant.

Mobile consumers are engaging with their devices starting at 5 a.m. Eastern Time, which reflects British businesses ramping up at that hour and the Eastern U.S. seaboard slowly coming online.

The ramp continues steadily until the decline starts at midnight Eastern and steadily trails off until 5 a.m. Eastern time the following morning.

The peak traffic of the day on our network is around 8 p.m. ET, where most of the U.S. – Hawaii and Alaska, notwithstanding – is in their evening mode.

We have three categories of users during the week and we see various content consumption behavior.

Called “Mobile Mornings,” which we define as 5 a.m. to noon ET, we see above-average network spikes in content such as weather, traffic, news/local, health and fitness and productivity.

The “Mobile Workday” spans from 9 a.m. to 7 p.m. ET, when network traffic continues to ramp as other U.S. time zones come online.

During this time period, we see a shift and spikes in content drivers, particularly around travel and lifestyle, shopping and retail, business and finance, ebooks and reference, music, portals and general content.

We enter the “Mobile Primetime” From 5 p.m. to midnight, where mobile users switch to social interaction and entertainment-focused content.

Why is mobile engagement constant throughout the day?

Slice of life
 There is now a great amount of data in the market that shows that 60 percent of mobile usage – using phones and connected devices such as tablets or e-readers – happens when consumers are on-the-move, yet 40 percent of the daily usage is actually coming from inside the home.

That data point specifically points to research shared with us by InsightExpress several months ago.

These critical pieces of data are not surprising to me. I watched the faces in the room during the panel when I spoke about some of this data. Perhaps it is easier to pull in some real-life examples.

I think about the devices that exist in and out of my home and my own family’s mobile engagement.

We do not own an alarm clock, radio or personal laptops. We use our mobile phones/connected devices as full replacements for these devices.

We have a PC at home, which my 14-year-old daughter lovingly calls, “The Dinosaur.” She uses the PC for typing her school papers.

We have a landline, yet I could not tell you our number if you paid me. In fact, I do not think we have checked the voicemail on that phone in six months. It is filled with telemarketer hang-ups.

My daughter’s main point of access to the outside world is not her phone, it is her iPod touch. She accesses the mobile Web, manages her music and applications, plays her games, and even texts through an app.

Indeed, she uses her mobile phone less and less – particularly because she does not call anyone (disclaimer: she calls me from time to time, but she never calls her friends – they are text only).

My husband and I have our tablet open on the coffee table throughout the football games on Sundays.

We are constantly looking up background on players, history of coaches, checking our fantasy and pick’em leagues.

Although the RedZone is the best television network during football, we even stray from football content and onto other areas pertinent to our lives during lulls in the games.

Not out there
 When we are out as a family, our mobile devices help us decide our activities, where we will eat and what store we will go to. Much of this is driven either by suggestions (ads) and/or mobile commerce-type functionality such as buying available movie tickets via our phones, ordering delivery or making reservations.

We use our devices in-store not only to compare prices, but also to look up product information or take advantage of mobile-enabled displays or deals.

I saved 20 percent through an in-store text promotion. Yes, the advertiser will likely market to me again, but hey, I saved about $200 through the promotion, so market away.

We use our devices while we are at our daughter’s volleyball games or our nephews’ soccer games to decide what to make for dinner, look for store hours/maps for the next destination, or simply to browse the news and events, or check out favorite sites and blogs.

In the evenings – literally every night before the lights go out, we are on our mobile devices – closing out our days, planning the next, talking about our lives and using our mobile devices as instruments of information, organization, conversation and entertainment.

SO, EVEN MY own family’s behavior proves the data around time and place of mobile usage.

We definitely use our mobile devices while we are on the move, but we use it extensively at home as either standalone devices or to amplify other media we are consuming at that time.

There lies the marketing imperative. If your consumers are living their lives with a marketing touch point in front of them at every point of the funnel on a continual basis, what are you doing to engage with them or us?

Erin (Mack) McKelvey is senior vice president of marketing at Millennial Media, Baltimore, MD. Reach her at .

Filed Under: Mobile Marketing News

Search + Mobile = Purchase (Maybe)

January 21, 2011 By Leave a Comment
3 Smartphones-B

by Laurie Sullivan, MediaPost

During Google’s earnings call on Thursday, Jonathan Rosenberg, senior vice president of product management at Google, told investors, analysts and media local and commerce are two emerging sectors Google plans to nurture this year. Rosenberg said five million businesses claimed their Google Place pages. The tech company also recently started testing a new ad product called Boost, aimed at giving businesses a fast way to promote their companies online, as well as connect with people who search for them. And in commerce, the company found a method to close the loop from offline to online shopping. The key to unlocking mobile commerce was to make it easy for people to search for an item and then purchase it from their mobile device.

Baynote recently released the Baynote Holiday Online Shopping Experience Survey, which analyzes 500 U.S. online holiday shoppers during the month of December. The study provides a look at consumer satisfaction with their digital experience across several areas including mobile and social.

It turns out non-traditional promotions show promise. Thirty one percent of respondents were influenced by promotions through Facebook, while only 17% were swayed by Twitter, and 20% were influenced by mobile promotions.

Similar to the thinking behind Google’s mobile strategy, mobile devices show promise when it comes to getting people to make a purchase on the go. In fact, 13% of respondents used their mobile phones to make holiday purchases in 2010, while 18% used it to comparison shop.

Sixty eight percent revealed convenience was the biggest reason for making a purchase via their mobile phone. Forty six percent said they made the purchase because it was a time-sensitive promotion. Fifty one percent said it was more convenient to do it on their computer, and 26% pointed to security concerns for not making the purchase on their phone.

It appears from the study results that search engines such as Google and Bing need to improve the relevancy of search results. Poor search results led to site abandonment more often than not. Fifty-five percent of consumers abandoned sites mid-way through an online shopping session this season. Fifty percent of shoppers said it was because of misleading search results, and 48% said they abandoned sites because they couldn’t find the products they were initially looking for once they arrived on retailers’ sites.

And once holiday shoppers found retail Web sites, they struggled to find what they looked for. Retailers did not do a great job this season helping consumers locate items, impacting revenue margins. Fifty-seven percent of respondents said they would like sites to improve their site navigation and 54% said the same for site search.

Of product recommendations, site search, site navigation and product reviews and ratings, excellent site navigation became the most valued by consumers, with 58% saying it is very important to them, followed by site search at 53%.

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Smartphone apps and mobile ads influence purchase intent: study

January 20, 2011 By 5 Comments

By Giselle Tsirulnik, Mobile Marketer

A study by Adology finds that mobile advertising and branded smartphone applications influence consumers’ purchase decisions.

Nearly half (49.2 percent) of home furnishings consumers say mobile applications or advertising influenced their purchase decision. The implication for retailers in this particular space is that they need to have a presence in the mobile advertising and applications arena.

“These retailers may want to consider adding this media type to their marketing mix, as mobile use continues to rise and the market for mobile apps expands,” the Adology Digital Media Influence study says.

Adology is a research firm that focuses on the specific demographic, psychographic, geographic or vertical market segments most likely to be the best customers for specific sectors and what motivates them to buy.

The Digital Media Influence study focuses on mobile marketing in the United States.

Influencing purchase intent 
 Consumers who report that mobile applications or marketing influence their purchases are primarily male (54.4 percent), adults ages 25-34 (31.9 percent) and homeowners (63.9 percent).

Almost half of the casual clothing buyers surveyed, or 46.6 percent, say mobile applications or advertising influenced their purchase.

Apparel and accessories retailers need to be using mobile advertising and smartphone applications to keep in touch with customers by sending promotional texts and offering a store-related mobile application that could feature information such as a style guide, store locator and upcoming sales events, according to Adology.

But home furnishings and clothing buyers are not the only shoppers influenced by mobile advertising and applications.

Buyers of personal care services (42.7 percent), vehicles (45.3 percent), home maintenance and repairs (42.7 percent), auto care (42.7 percent), jewelry (44.0 percent), insurance (45.4 percent) and electronics (44.0 percent) are also influenced by this type of mobile marketing.

The study also mentions that direct mail is an important driver of purchase intent.

“Retailers may find success utilizing direct mail and mobile apps or advertising,” the study says. “One possible strategy is to send out mail pieces that promote the business’s mobile app or text promotion, or allow readers to sign up for direct mail pieces via the text messaging or mobile applications.

“It appears that a healthy mix of online and offline marketing can influence a variety of purchasers,” it says. “Mobile use continues to increase, and there is a large market for not only new smartphone users, but also for those who upgrade their smartphones.

“Retailers should be utilizing these marketing methods in anticipation of this expected continued growth.”

Media usage
 More than half, or 53.7 percent, of consumers influenced by mobile applications or advertising use a smartphone.

IPhone users lead the pack with 14.8 percent, followed by BlackBerry (13.4 percent) and Google Android (9.1 percent). By type of phone, the breakdown is as follows:

Adology said that the reason why iPhone users report the most influence, may be due to the prevalence of Apple’s iTunes, which is considered the leader in mobile application sales.

However, as other mobile app stores gain prominence, it is likely that users of other smartphone types will report increasing influence by mobile marketing.

Approximately 98 percent of recent consumers who report influence from mobile applications or advertising use the Internet.

To reach more readers online, businesses may want to consider broadening the scope of their other online activities, particularly those that are most popular among consumers influenced by mobile apps or advertising.

These activities include checking the news, weather, conducting online banking and shopping. Specifically, Internet activity via smartphones in the past year includes downloading applications, visiting mobile Web sites and watching mobile video.

Among influenced consumers, the most popular social networks are Facebook (used by 73.8 percent) and YouTube (43.3 percent).

“Cross-promotion of both social network profiles and mobile apps or marketing could be a successful way to capture even more consumers’ attention,” the Adology study says.

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Retailers at NRF National Conference told to ‘Think Mobile’

January 10, 2011 By Leave a Comment
BY JOAN VERDON, Staff Writer, The Record

Retailers who want to grow sales in coming years need to “think global,” “think green” and “think mobile,” according to experts speaking Sunday at the National Retail Federation convention in Manhattan.

Global expansion, sustainable environmentally friendly business practices, and using smart phones and iPads to reach consumers were the hot topics as retail executives gathered for the world’s largest retail convention.

The annual convention is expected to draw more than 18,500 attendees this year, with advance registration running well ahead of last year. It also is the 100th anniversary of the first meeting of 37 retailers who formed the original retail industry group, the National Retail Dry Goods Association.

Attendees on the opening day of the conference were in a far happier mood than last year, reflecting recent news that consumers have begun to spend a bit more freely. The convention opened three days after news that U.S. retailers posted the best holiday results since 2006.

But speakers warned that retailers in the future will have to work harder than ever to grow sales, especially in developed countries such as the United States or England,

“Growth in developed markets has peaked,” said Richard Hyman, strategic advisor for accounting firm Deloitte LLP. In North America and Europe, there are already “too many retail mouths to feed – too much floor space, too many stores,” he said. “It is an industry that is self-cannibalizing increasingly.”

Hyman said global retail sales are forecast to grow by $6.1 trillion over the next five years, but that 66 percent of that growth will come in developing markets such as China and India, with only 21 percent occurring in mature economies.

Deloitte on Sunday released its annual “Global Powers of Retailing” report, which ranked the top 250 retailers based on worldwide sales in 2009, the most recent year for which final results are available. Toys “R” Us in Wayne ranked 63 this year, down one spot from 62 last year. Bed, Bath & Beyond in Union moved up 10 spots on the list, to 114. Bed, Bath also was ranked as one of the top 30 retailers in the world based on what Deloitte calls the “Q ratio” – the value the stock market gives to intangible assets like innovation and customer loyalty.

While the convention is hosted by the Washington, D.C.-based National Retail Federation, the gathering is very much an international affair, with international executives attending from more than 70 countries, and most speeches translated into several languages.

Ten of the 22 retail workshops presented Sunday dealt with sustainability, or ways to be a more environmentally friendly retailer. Author and retail researcher Paco Underhill, CEO of Envirosell, cited the example of a Dutch shopping “all” – a combination shopping center and village where the retail stores are located underground, topped with residences and green spaces. In an “all,” as opposed to a mall, he said, consumers can live, sleep, shop and eat all in one place.

Terry Lundgren, president and CEO of Macy’s Inc. and chairman of the NRF, welcomed the attendees to the conference and said localization of stores, so they connect with customers, also will be important going forward.

“Being locally and individually relevant will be the new standard for stores,” Lundgren said.

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How World Events Drove Mobile Shopping in 2010

December 29, 2010 By Leave a Comment
cashphone

by Sarah Kessler / Mashable

eBay announced its most interesting mobile shopping trends of 2010 today. Among other topics, the company analyzed holiday season spending and shopping reactions to cultural events like Valentine’s Day, the World Cup and Apple’s iPad release.

The trends are based on the total value of items purchased using eBay’s mobile app, which more than 30 million people have downloaded. eBay spotted them using an interactive heat map it developed to demonstrate global mobile shopping in the top 20 of its shopping categories.

Sporting events were one area of cultural event the company found drove mobile sales. During the Winter Olympic Games in Vancouver, sales in the sports and memorabilia category peaked in Canada. During the Tour de France, the category peaked in France, and During the World Cup, where Germany placed third, the category peaked in Germany.

Gadget releases also powered sales. After the iPad debuted on April 4, there were more mobile sales in the consumer electronics category than any other day this year. Similarly, when the iPhone 4 launched in the U.S. on June 24, the cellphones and accessories category hit its peak as people flocked to eBay to buy new and pre-owned iPhones.

The most interesting finding when it came to Valentine’s Day was not related to jewelery or chocolate, but video games. Apparently geeks, perhaps reacting to a bevy of special online gaming tournaments, felt the need to stock up. eBay’s mobile app shoppers spent 68% more on video games in the week leading up to Valentine’s Day than they did last year.

Another impressive finding was the growth of mobile sales this holiday season. eBay’s mobile app sold nearly $100 million of merchandise in the U.S. during the month before Christmas, which represents an increase of 134% over last year at the same time. Considering that last year all U.S. mobile sales from all retailers all year long totaled about $1.2 billion, eBay alone selling about 10% of that in one month likely signifies an impressive growth rate for mobile commerce in general this year.

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Almost 1/3 of consumers would make mobile purchase if given discount

December 24, 2010 By Leave a Comment

By Dan Butcher , Mobile Commerce Daily

One out of three respondents who are willing and able to purchase goods or services with their current mobile devices would do so this holiday season using their handsets if they were presented with mobile-based incentives, according to a Sybase 365 survey of 1,000 consumers. 

When asked whether mobile-based incentives—coupons or discount offers, text or email alerts, gift cards—would entice them to make a purchase on their mobile device, 32 percent of respondents said these incentives would. The remaining 68 percent of respondents to the question either stated they would not make a mobile purchase or that they cannot do so on their current devices.

Mobile Commerce Daily’s Dan Butcher interviewed Cameron Franks, area vice president of sales for the Americas at Sybase 365, Dublin, CA. Here is what he had to say:

What is the key finding of the mobile holiday shopping survey?
 The key finding of the recent Sybase 365 survey results was that 32 percent of consumers, if offered mobile-based deals, coupons or alerts, could be incented to make a purchase on their mobile device.

The finding suggests that consumers are slowly transitioning from mobile commerce awareness to enabling and facilitating transactions.

While the majority of respondents to our survey would not make a purchase on their mobile device this holiday season, a large percentage believed that their mobile devices were not enabled with mobile payments or purchasing features or applications.

Clearly, there is still room for improvement in building awareness around mobile payments and transactions, but it is apparent that if consumers are presented with an incentive such as a mobile coupon or deal alert, they will be more likely to make a purchasing decision based on that communication.

What is the most surprising finding?
 We were not surprised by any of the survey findings. Sybase 365 understands that the key to driving mobile commerce purchasing decisions and transactions is consumer awareness.

While the percentage of consumers who will be making purchases on their mobile devices this holiday season is still low, we anticipated as much and are focusing on the evidence that momentum is building for mobile payments.

We look forward to conducting a similar survey at this time next year so that we can benchmark these results against those of 2011.

We anticipate that there will be an even larger percentage of consumers willing to make purchases on their mobile phones next holiday season.

At this point, the technology that facilitates mobile payments is developing at a much more rapid pace than consumer awareness.

Consumers are looking for a comfortable, familiar, secure environment to conduct a payment transaction.

Retailers and brands must focus on creating a secure and easy-to-use mobile site that consumers can use easily and feel confident that their payments and personal information is secure.

What advice can you give to brands / marketers and retailers / merchants based on your findings?
 The best advice that Sybase 365 would give to brands or retailers and their marketing managers is to add a multichannel mobile customer relationship management approach to their marketing strategy in order to reach 100 percent of their overall audience, which includes using all mobile channels—SMS, the mobile Internet and applications.

Consumers are becoming more demanding and will remain loyal customers to those merchants who reach them where they want to be targeted.

Merchants must ask themselves two questions when developing an effective mobile strategy: Are your customers active mobile users? How willing would they be to respond to mobile coupons or offers?

Once they have delivered the responses to the questions, they must implement a multichannel marketing strategy that includes targeting customers at bricks-and-mortar locations, online and mobile.

As more consumers adopt smartphones and mobile commerce services become easier to use, retailers and businesses alike will recognize that mobile may be the preferable channel, but until we reach the point of widespread adoption of mobile commerce, a multichannel approach must be the focus.

As the big brands and retailers set the mobile commerce tone, how will the smaller and independent brands and retail outlets compete? They must listen to their customers and reach them where they want to be reached.

What is driving growth in the adoption of mobile commerce / shopping by consumers?
 The results from our recent survey show proof that interest and demand for mobile commerce exists, but we have still yet to reach the tipping point for widespread mobile commerce adoption.

Convenience, immediacy and ease of use will be the driving factor behind driving mobile commerce growth.

Consumers are demanding a more convenient way of making payments. They want a familiar and enjoyable shopping experience, and they do not want to have to worry about security or technology hiccups.

There has been much debate recently about the feasibility and implementation of Near Field Communication and whether that will be the tipping point for widespread adoption of mobile payments. 

NFC will most likely be part of the technology mix that drives the growth of mobile commerce, but it will not be the only solution.

The industry at large must find a way of improving remote and proximity payments via mobile. 

The experience of transitioning from purchasing goods online at an ecommerce site to mobile purchases must be seamless.

The growth in mobile commerce is happening slowly.

The majority of consumers are already using SMS text messages on their mobile device, so it appears that they are a natural channel for delivering marketing and advertising directly to customers.

Rite Aid has already implemented an RX alerts service, which delivers mobile messages to customers when they are prescriptions are ready to be picked up.

And Target’s mobile Web site and apps help customers compare prices and deals, as well as offer specialized deals when they detect that a customer has entered a store.

Retailers are some of the new businesses working to break new ground with mobile commerce by creating mobile payment store loyalty card applications, coupons or deal alerts to engage customers.

As long as they are able to develop a system that is convenient and easy to use and replicate the same kind of experience that consumers already have become familiar with online, mobile will become the preferable channel for commerce and transactions.

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Santa via Cellphone: Shopping Online Without a Computer

December 22, 2010 By Leave a Comment
mobile shopping app
By CLAIRE CAIN MILLER and VERNE G. KOPYTOFF, New York Times

This holiday season, consumers are beginning to shop and make purchases on their mobile phones. The shift from buying presents in front of the computer at home or work to doing it during bus commutes or while standing in line at cafes is small, but, for the first time, noticeable and even significant.

Tiffany English, who runs an eBay shop, found a gift for her brother at Bed Bath & Beyond, then bought it on Amazon using her phone.

 Juan Arredondo for The New York Times

EBay and other Web sites have made it easier for consumers to shop and buy from cellphones and tablet computers like iPads.

Shopping on cellphones and portable tablet computers like iPads accounted for about 5 percent of online sales in November, while last year mobile shopping sales were too insignificant to measure, according to Coremetrics, an e-commerce measurement service owned by I.B.M. Many more shoppers are using their phones to research items and compare prices before making purchases offline or on computers.

“There were early adopters last year, but it’s absolutely real this year,” said Kelly O’Neill, director of industry marketing for ATG, which provides online and mobile commerce technology to retailers like Best Buy and J. C. Penney. And mobile shoppers are buying high-ticket items like diamond rings and cars, not just virtual goods and ring tones.

On Dec. 12, eBay’s busiest mobile shopping day of the year, worldwide mobile sales nearly tripled from last year to $13 million, according to the company, which expects $1.5 billion in mobile sales this year.

Virtually every product that people buy on computers sells in similar proportion on mobile devices, said Steve Yankovich, eBay’s vice president for mobile. He said shoppers bought an average of four Ferraris a month from their cellphones.

Tiffany English, 30, of Hoboken, N.J., bought her mother’s Christmas gift, a painting of a child, when the eBay mobile app alerted her that the auction was about to end while she was out in Greenwich Village. She used eBay’s RedLaser app to compare prices on a set of barbecue tools for her brother, and bought the set on her cellphone from Amazon.com while standing in Bed Bath & Beyond, where the same item cost more.

“It’s saving me time and saving me money,” Ms. English said. “I feel like my grandma: ‘You can do that with your phone?’ ”

EBay is so convinced of the future of mobile phone shopping that on Wednesday it acquired Critical Path Software, a mobile phone app developer, to speed its move into this new arena.

At Blue Nile, the diamond and jewelry e-commerce site, mobile revenue is up sixfold this month from the period a year ago. The company says a mobile shopper recently bought a ring for more than $250,000 via a cellphone.

“A year ago, we really didn’t know whether mobile would be very impactful for our business, because this is a very considered purchase, a high-ticket luxury item,” said Diane Irvine, chief executive of Blue Nile. Now, she said, “we can envision a time when sales from a mobile device will eclipse sales over the desktop Web site.”

Most shoppers still use their phones for finding nearby stores or looking up reviews and comparing prices, rather than for buying goods, retailers and analysts say. Still, that type of research increasingly leads to mobile sales, particularly for online retailers that compete heavily on price, like consumer electronics stores, said Sucharita Mulpuru, principal analyst for e-commerce at Forrester Research.

Perhaps the biggest reason for the spike in mobile shopping is simply that more Web retailers have created mobile Web sites or apps that make it easier to search inventory on a small screen without a mouse, by forgoing fancy Flash graphics and selling a limited number of products on phones.

Mobile apps often have features that Web sites don’t. For example, Amazon’s app lets people scan bar codes, speak into the phone or take a photo of an item to search for products. Bluefly’s sends a cellphone alert when an item that was out of stock becomes available again.

Just as e-commerce made it possible for people to shop in the office and late at night, mobile phones let them shop anywhere. And because shoppers on cellphones often have a purchase in mind, they can be more valuable to retailers. “Mobile shoppers are the hunters, and people sitting at their computer are gathering,” said Jill Dvorak, senior consultant for the e-commerce advisory company FitForCommerce.

Tom Keithley, 49, of Monkton, Md., is one of those hunters. He travels often for his job in financial services, and this year he did half his holiday shopping while on the road. From his cellphone he bought a Blue Nile ring for his wife and a eucalyptus wreath from Gump’s, the home décor shop.

“I’m usually in airports and airplanes, so it’s more convenient for me to use the time to do things I might normally do if I were sitting at my desk,” he said.

Mobile shopping is particularly appropriate for customers of flash sale sites like Gilt. Its limited-time sales start at noon each day and sell out quickly, so people miss out if they are away from their computers. Since Gilt introduced its mobile apps, shoppers have more consistently made purchases at noon, and mobile sales generally account for 10 percent of revenue and close to 20 percent on holidays and weekends, said Carl Sparks, president of the Gilt Groupe.

The iPad has also helped mobile commerce, but in a different way. While cellphone apps are made to complete transactions as quickly as possible, iPad apps tend to be for shopping as sport. For instance, Amazon’s iPad app, called Windowshop, shows many images and lets people browse and view close-up shots of items.

“It makes it much more visual and fluid and entertaining,” said Sam Hall, director of mobile at Amazon, “something that never could have been done on a smaller-screen device.”

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Does the SmartPhone Change the Way Consumer’s Shop?

December 21, 2010 By Leave a Comment
Tapping into savings graphic

Keeping with the theme of this month’s The Mobile Marketing Review podcast about mobile shopping, below is an interesting article from the Wall Street Journal that discusses the impact that the smartphone is having on consumer shopping behaviors and the retail industry.

__________________________________________________________

Phone-Wielding Shoppers Strike Fear Into Retailers

By MIGUEL BUSTILLO And ANN ZIMMERMAN, Wall Street Journal

Tri Tang, a 25-year-old marketer, walked into a Best Buy Co. store in Sunnyvale, Calif., this past weekend and spotted the perfect gift for his girlfriend.

Last year, he might have just dropped the $184.85 Garmin global positioning system into his cart. This time, he took out his Android phone and typed the model number into an app that instantly compared the Best Buy price to those of other retailers. He found that he could get the same item on Amazon.com Inc.’s website for only $106.75, no shipping, no tax.

Prices

Tri Tang uses his mobile phone app, TheFind, to scan product bar codes and immediately troll online for the best price at various retailers.

While many holiday consumers refuse to pay full price, retailers are trying to outdo one another by encouraging shoppers to spend more, but without giving away the store. Elizabeth Holmes discusses some of retailers’ most popular discount tactics.

Mr. Tang bought the Garmin from Amazon right on the spot.

“It’s so useful,” Mr. Tang says of his new shopping companion, a price comparison app called TheFind. He says he relies on it “to make sure I am getting the best price.”

Mr. Tang’s smartphone reckoning represents a revolution in retailing—what Wal-Mart Stores Inc. Chief Executive Mike Duke has dubbed a “new era of price transparency”—and its arrival is threatening to upend the business models of the biggest store chains in America.

Until recently, retailers could reasonably assume that if they just lured shoppers to stores with enticing specials, the customers could be coaxed into buying more profitable stuff, too.

Now, marketers must contend with shoppers who can use their smartphones inside stores to check whether the specials are really so special, and if the rest of the merchandise is reasonably priced.

“The retailer’s advantage has been eroded,” says Greg Girard of consultancy IDC Retail Insights, which recently found that roughly 45% of customers with smartphones had used them to perform due diligence on a store’s prices. “The four walls of the store have become porous.”

Some of the most vulnerable merchants: sellers of branded, big-ticket items like electronics and appliances, which often prompt buyers to comparison shop. Best Buy, the nation’s largest electronics chain, said Tuesday that it may lose market share this year, a downward trend that some analysts are attributing in part to pressure from price comparison apps.

Smartphone fans such as Mr. Tang are still a small subset of shoppers. It remains unclear whether large numbers of Americans will be willing to take the extra time to compare offers with mobile programs. Some consumers may want to deploy the technology only when buying expensive or unusual items.

Prices2

Brian L. Frank for The Wall Street JournalMr. Tang’s smartphone reckoning represents a revolution in retailing.

Still, store chains are increasingly concerned about the ability of mobile-equipped shoppers to tilt the balance of power in retailing toward consumers—in part because their numbers are quickly rising.

On the Friday after Thanksgiving a year ago, consumers using mobile devices accounted for just 0.1% of visits to retail websites, according to Coremetrics, a division of International Business Machines Corp. that estimates e-commerce activity. This Black Friday, they accounted for 5.6%, for a 50-fold increase.

E-commerce experts expect use of shopping apps to mushroom as more Americans purchase smartphones.

Dozens of mobile shopping apps are already available through Apple Inc.’s iTunes, and programmers are busy developing many more to transform smartphones into shopping weapons. Many of them use phone cameras to photograph bar codes and QR codes, or simply let users speak a product’s name into their devices.

TheFind app has been out for four weeks and has been downloaded 400,000 times, according to the company. RedLaser, an app that allows shoppers to use mobile-phone cameras to scan bar codes to compare products and prices, has now been downloaded six million times since it was introduced in May 2009, says parent eBay Inc.

Although store executives publicly welcome a price-transparent world, retail experts don’t expect all chains to measure up to the harsh judgment of mobile price comparisons. Some will need to find new ways to survive.

“Only a couple of retailers can play the lowest-price game,” says Noam Paransky, senior manager at consultancy Kurt Salmon Associates. “This is going to accelerate the demise of retailers who do not have either competitive pricing” or a standout store experience.

Because consumers made more frugal by the economic downturn are flocking to the cheapest offers they can find, comparison shopping via smartphones is making it harder for many retailers to charge higher prices in stores than on their websites.

“Those days are over,” says Laura Conrad, president of comparison site PriceGrabber.com. Despite the higher costs associated with a bricks-and-mortar store, “The line between offline and online has been blurred.”

This week, Best Buy settled a lawsuit by the Connecticut attorney general alleging that it showed web prices at in-store kiosks that were higher than those customers saw on home computers.

The shift in consumer behavior also imperils some of the most lucrative aspects of selling in stores, such as the ability to use salespeople to lure customers into making impulse buys, or entice them to buy one thing after they came in for another. A 10-country study by management consultant Accenture this year found that 73% of mobile-powered shoppers preferred peering into their phones for basic assistance over talking to a retail clerk.

For diehard deal-hunters such as Mary Saunders, a Virginia mother of two, the phone is fast becoming the weapon of choice in the battle for the best bargain. Hunting for Christmas gifts on a recent afternoon, Ms. Saunders used her iPhone at several stores to scan bar codes on every item on her children’s Christmas wish lists, saving $2 here and $3 there.

Ms. Saunders still gathers newspaper circulars and visits all the big stores near her home in Stephens City, Va., to scrutinize specials. But her phone gives her a new sense of empowerment.

“I am slightly obsessed with getting the best deal,” says Ms. Saunders, a substitute teacher. “So to me, the bar code scanner is the coolest thing in the world.”

While e-commerce experts say many U.S. retailers have been slow to react to the mobile trend, some are starting to see that there is upside as well as disruption: Now retailers can virtually target customers inside competitors’ stores.

Through a partnership with TheFind, Best Buy now targets personalized advertisements to shoppers when the program detects that they are in stores such as Wal-Mart.

If shoppers use TheFind’s free app to compare prices on TVs at Wal-Mart, for example, the phone gleans the particulars from their recent search and shows them ads of similar electronics for sale at Best Buy. The items aren’t always identical, and the prices aren’t always better, but it is an attempt by Best Buy to enter the competition, similar to the way that marketers now target special offers to consumers based on what they are searching for on home computers.

The offers are only sent to customers who opt to allow the program to use their phone’s global positioning system to track their location. Still, some consumers have complained about the technology; one review on iTunes is titled, “Spying on Me 24/7.”

“That is an opportunity to steal a sale right when someone is in the throes of making a decision. That is what makes mobile so powerful,” says Best Buy Chief Marketing Officer Barry Judge, who believes retailers must “dive in headlong” into the new environment.

The hard sell doesn’t stop there. If a customer inside a Best Buy compares prices through TheFind and discovers a better deal elsewhere, the retailer also makes one last pitch for the sale with ads showing them deals on other products at the store, such as a similar Blu-ray player that comes with a free movie disc.

“Instead of letting that person walk out, you are telling the customer, ‘Look, we know you’re already here, let’s make a deal,’” says TheFind’s Chief Executive, Siva Kumar. “It is not a consumer-only game. Retailers can use it to their advantage.”

While Best Buy is aggressively entering the stores of rivals, it still refuses to match competitors’ prices shown on comparison programs. Best Buy’s guarantee applies only to deals in print advertisements by neighboring competitors, a policy Mr. Judge admits Best Buy may have to change.

Wal-Mart plans its own countermeasures to capture mobile sales, says Gibu Thomas, the company’s senior vice president of mobile and digital strategy.

But the company, which doesn’t see mobile-phone apps as a threat to its discount model, says it is wary of moving too rapidly and frets about being seen as Big Brother by following customers’ movements as they shop.

“We continue to believe that we are the best-positioned global retailer for now and the years ahead,” a Wal-Mart spokesman says.

Pure online sellers are also venturing into stores—virtually, that is—with mobile programs meant to steal away sales from bricks-and-mortar rivals.

Amazon.com released a new comparison app last month that allows iPhone users to scan bar codes, take pictures of items on shelves or describe products by speaking into their devices, to see whether the online giant can beat the store’s prices.

“We want customers to feel confident in their purchases, and by allowing them access to Amazon’s information wherever they are, they will be,” says Sam Hall, director of Amazon Mobile.

The hassle of multiple store visits still outweighs the allure of small savings for smartphone warriors such as Matt Binder, a 24-year-old employee of a startup web company in New York City. But when presented with an option to click a button to save a few dollars, he gladly complied.

Armed with an iPhone loaded with Amazon’s Price Check app, he was searching for holiday gifts on a recent Sunday in a Westbury, N.Y., Best Buy when he spotted a stocking stuffer, a two-gigabyte USB drive, for $11.99. He snapped a picture of it, and learned from the app that Amazon had it with more memory for $9.99.

“I wouldn’t drive somewhere else to save $2,” he says, but he made a mental note to buy it from Amazon later when he got home, to save precious battery power on his shopping tool.

At Wal-Mart, he saw the same flash drive, beside a big display boasting “Every Day Low Prices.” But thanks to his smartphone, Mr. Binder knew better. The advertised price was $6 higher than Amazon’s.

Indeed, the mobile phone threatens to undercut Wal-Mart’s once novel strategy: promising to save consumers money on their overall shopping baskets instead of promoting individual items.

“The whole notion of going to one place to buy everything in one fell swoop because you are sure of a total market-basket savings may go away,” says Leon Nicholas of consultancy Kantar Retail.

Toys “R” Us nearly went under six years ago when Wal-Mart brutally slashed prices on popular toys in a successful bid for market share. So the toy merchant is trying to insulate itself from direct price comparisons with a strategy that focuses in part on exclusive items.

“The most successful retailers have great product,” says Toys “R” Us Chief Executive Gerald Storch. “That always wins over everything else. Unless you’re selling coal.”

In practice, such a strategy has limitations, however. Many shoppers, especially children, want the same thing their friends got, not something else.

A day of shopping with Ms. Saunders in Virginia shows what retailers are up against.

She was approached repeatedly by shop clerks who offered to help, but rebuffed them in case they tried to talk her into buying more. Her smartphone told her a DSi game on her list goes for $10 less at Best Buy and that Target has Barbie’s Fashionista dolls for the cheapest price around—by $3.

One way stores attempt to beat this price-comparison game is by stocking products that manufacturers have slightly modified exclusively for them, signaling the phone that no other store has the product.

Ms. Saunders used her iPhone to scan the bar code on a case for the Nintendo DSi handheld gaming system at Wal-Mart, but it didn’t show up at other stores. A worker informed her that it is a special Wal-Mart bundle: the case plus earphones and a plug for $19.99.

But Ms. Saunders was undeterred. She typed the item’s description on TheFind and discovered that Walmart.com, the retailer’s website, offers a better bundle including a car adapter—for $5 less.

“It’s like, ‘gotcha,’” she said. “I feel so good when that happens.”

Filed Under: Mobile Marketing News Tagged With: , , , , , ,

More consumers let their smartphones do the shopping

December 13, 2010 By Leave a Comment
General growth properties mobile app
By Erin Kutz Special for USA TODAY
When Te-kai Shu got to the register at Best Buy on Black Friday, he didn’t pull out a rewards card or coupon to rack up extra savings.”I whipped out my smartphone … to make sure (the cashier) credited my purchase to my Reward Zone account,” say Shu, 29, of Bristol, Tenn.

Shu is part of a growing group of consumers who look to their smartphones — Internet-enabled mobile phones — to save money and stay informed when buying. Nearly six in 10 mobile users say they’ll be using their phones for holiday shopping, and retailers are falling all over themselves to offer applications and mobile websites to meet the demand. With smartphones, shoppers can compare prices, store loyalty and gift cards, make wish lists and get discounts at their favorite stores.

But retailers also risk alienating customers if the apps and mobile websites fail to deliver. More than half of customers surveyed say they won’t return to a mobile site if they’ve had a poor experience, according to a study by Gomez, Compuware‘s unit that studies website performance.

And performance expectations are high: Nearly 60% of people anticipate mobile sites will run as smoothly as or better than sites they visit on their computers, the Gomez study showed. Meeting the challenge has been difficult. Consumers ranked the performance of mobile sites of the Thanksgiving holiday weekend’s 15 largest retailers as “tolerable,” compared with the retail websites overall.

FREE SHOPPING APPS: Can help you get the best deal

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Much of the interest in mobile has occurred in the past year — 25% of consumers say they’ll be turning to their phones more than they did in 2009, according to a study by the Mobile Marketing Association and Luth Research. And the mobile apps centered on shopping aren’t just for fun and flash. They could mean real savings for consumers, especially those who search for better prices. Scouting locations where gifts are sold and comparing prices ranked as the top two reasons consumers plan to use their phones during holiday shopping.

Mobile phones offer shoppers the resources of the Web while they’re in a store and enable retailers to deliver the most relevant deals. But shoppers can also use them to make purchases with their credit or debit cards, though they could be opening themselves up to identity theft, says John Hering, CEO and co-founder of Lookout Mobile Security. “The mobile device has become the most personal computer and, with that, identity thieves are now beginning to turn their sights to smartphones,” he says.

Retailers have long matched rivals’ prices, and shoppers search ads in fliers or on the Internet to find the best offers. Now, consumers can discover competitors’ prices while in a store, thanks to mobile sites and apps such as PriceGrabber, which more than half a million consumers have downloaded.

The iPhone and Android application is the mobile incarnation of PriceGrabber’s website, which attracts about 26 million shoppers each month. Using the mobile app, shoppers can scan an item at a store and see information on the best price on the product across multiple retailers. They can try to haggle for a better deal while they’re in the store, or buy it for less through a competitor PriceGrabber has discovered. The service even calculates exactly how much the purchase will be when shipped directly to a consumer’s home, showing which option is the least expensive down to the last cent, PriceGrabber President Laura Conrad says.

“The difference in prices is pretty significant for most of the sellers we have up there,” says Conrad. “On any given day, most of these sellers could be running a special. Online retailers can change them on the fly.”

On Black Friday, consumers used the iPhone app most often to search for price comparisons on electronics, computers, cameras, appliances and toys, the company reported.

LaKeitha Luster, 36, of Natchez, Miss., says she’s always compared prices before big purchases, but now she’s pulling out her smartphone to do the task. Getting comprehensive product information through the mobile sites can prove challenging, though, she says. “When you look at items online (particularly on a BlackBerry), I don’t normally get a full description of what I’m interested in purchasing,” Luster says.

Shopping-focused apps could help customers earn rewards and cut back on unnecessary travel expenses to get to a store. The iPhone and Android app CheckPoints earns shoppers points when they take pictures of the bar codes of items the app chooses to feature. The points are redeemable for gift certificates from retailers such as Sephora and Neiman Marcus, plus gadgets, airline miles and charity donations. Another app, Shopkick, enters people in sweepstakes just for doing what’s known as “checking in” — alerting the app that they’ve walked into a particular store.

Social-networking giant Facebook has gotten involved in mobile check-ins with its Facebook Places service. Shoppers could get deals for checking in once, returning to a store or bringing friends to a store. Gap, Macy‘s and American Eagle Outfitters are among those offering discounts this way.

Some mobile apps deliver deals based on a customer’s preferences and where they are, thanks to location-finding technology that tracks where a customer shops and what items they check out. Mobile app developer Yowza claims it has saved users more than $5.4 million.

The app hunts down coupons from nearby retailers and sends vouchers straight to shoppers’ phones, which cashiers can scan at checkout. Lane Bryant, which has offered “buy one, get one free” deals through the app, is among the more than 300 brands Yowza has enlisted.

Mobile devices can also combine tasks that consumers have typically done only in stores or only from their computers. “Stores are really starting to understand that the lines between online and brick-and-mortar stores are blurring right now,” Conrad says, pointing to retailers such as Walmart that have added Wi-Fi service so customers can go online while shopping in a store.

Mobile smartphones also deliver online information to shoppers at traditional malls. Many big malls and department stores are hopping on board:

•Mall operator Simon Property Group offers an iPhone app that can automatically notify a shopper’s social network when she has checked into a particular store at the mall. The Simon app also delivers specialized deal alerts and can help shoppers remember where they parked.

•General Growth Properties gives consumers access to promotions and discounts at its 150-plus malls nationwide through its Club Shopping Mall Guide app. GPS-based store directories help shoppers navigate the malls. Shoppers also can play mobile games for prizes. For instance, the app might display a picture of a snow globe, prompting consumers to shake their phones for the chance to win a $100 mall gift card or to enter a sweepstakes for a $500 gift card, depending on what the virtual snow globe reveals.

•J.C. Penney has built a mobile-compatible website and an app for the iPhone and Android phones. Both provide a peek at weekly sales circulars and help in finding the nearest store. It also lets shoppers create mobile wish lists, take advantage of coupons and access their store rewards account.

•Target‘s mobile website and apps store prices to help customers compare deals. The chain also offers coupons that can be scanned and redeemed from the smartphone.

“It can detect when a consumer comes in a store and offer specialized incentives right on the spot,” says Bob Egner, vice president of global marketing at EPiServer, a software company that powers e-commerce websites.

Consumers could also better prepare themselves for big holiday shopping trips by using apps that make store loyalty cards virtual, as Shu did.

Mobile app Swagg’s aim is for users to “have everything, carry nothing” — in their wallets, that is, says Rocco Fabiano, president of Firethorn Holdings, Qualcomm‘s mobile commerce subsidiary. The mobile tool stores up to 300 loyalty and gift cards on a smartphone.

Swagg also delivers deals straight to the mobile screen, much like Yowza. There are more than $55,000 in discounts from more than 3,000 brands available through the app, Fabiano says. Users can choose which types of offers they’d like to see.

Shoppers could even cut shipping costs on gifts and send last-minute presents through mobile-gifting services. Swagg has at least half a dozen retailers on board for its gift card swap service, where people can send a gift card right to a loved one’s smartphone. The app is working on getting more retailers to participate in this service. Options now might be a bit limited.

Mobile apps may also help shoppers better filter discounts and inventory on big e-commerce sites. The eBay Deals app for iPhone brings users daily deals and enables customized searches for bargains.

The Overstock.com mobile app has all the same shopping and search capabilities as the website and could also help shoppers ring in extra savings through its Lott-O function, which offers exclusive chances to win extra savings.

Some shoppers might be wary of closing transactions on their smartphone, though, and may opt to browse for deals on their phones but pay from their computers, says Sandeep Bhanote, CEO of mobile retail software provider Global Bay Mobile Technologies.

Egner says brands need to pay attention to the palm-size screen. “If you want to be a retailer, you’ve got to have a mobile site to be competitive,” he says.

Shu is skeptical of the security of the information on his smartphone, but he’s still loading it with reward cards, tracking down coupons and scanning bar codes.

His phone, he says, is “a very convenient tool” that helps him decide “how and where we shop.”

Filed Under: Mobile Marketing News Tagged With: , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

Cool Mobile Info by Sphere Trending

November 23, 2010 By Leave a Comment
did you know…?
More than one-half (59%) of consumers plan to use mobile devices for holiday shopping and planning holiday celebrations this year. Some key statistics: 64% plan to use their phone before going into a store, 13% will use their phone to make a purchase or pay for gifts, 12% plan to use their phone to respond to a billboard or advertisement. via: MMA (Mobile Marketing Association)Toys R UsTo connect with the tech savvy shopper this season, Toys “R” Us launched it’s “R” mobile messaging service that sends the consumer instant deals and offers directly to their mobile device. The retailer also implemented bar code scanning devices at the checkouts to allow store associates to scan coupon codes directly from customer’s mobile devices.

look…
The FindBest Buy is running ads within TheFind, an online and mobile application, giving consumers discounts to products for which they are searching for. TheFind shopping app connects online, through facebook and in-store with mobile barcode scanning, price comparisions and product location searches.As customers search for items on TheFind, if the product they are looking for is carried in a Best Buy Store, the retailer offers the customer a special discount and a map to the closest location.

interact…
2D codes (also known as “QR” / Quick Response Codes) are seemingly everywhere this holiday season. The Sears Wish Book has them, Calvin Klein has replaced racy billboards with them, banks use them in airports and they’re in stores everywhere. One of our favorite retail examples is the launch of Urban Decay’s video campaign in Sephora stores. Simply by using a free app and scanning the colorful QR code, the shopper can access different “how-to” videos for cult products such as their Primer Potion and Midnight Cowboy Shimmer Shadow.Urban DecaySears Wish Book

fun…
Loopt Opt Out DayWell… I’m not sure how much fun being patted down by the TSA might be, but the location-based mobile check-in service, Loopt, is trying to make a game out of the uncomfortable security checkpoint situation. Any traveler using the Loopt service on “National Opt-Out Day” who chooses to forego the body scanner machines in favor of the “pat down” will be entered to win one of ten iPod Touches. (Get it? Touches? Thumbs up or down for the cheeky play on words?!) The National Opt-Out Day will take place this Wednesday – the busiest travel day of the year.via: mashable
Filed Under: Mobile Marketing News Tagged With: , , , , , , , , , ,
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