The Nearbuy Blog

Nearbuy Helps Kiddicare Extend Its Amazing Baby Experience Into Multichannel Shopping

Tue, 29 Jan 2013 01:07:00 GMT

We recently posted a customer case study with Kiddicare, an award-winning e-retailer in the UK. Continuing their track record of innovation, Kiddicare is opening a series of superstores in the UK focused on creating a multi-channel experience for parents (who put a lot of time and energy into buying all the things that children need). Kiddicare purchased the physical stores that Best Buy abandoned in their unsuccessful efforts to expand in the UK and capitalized on these assets to create some amazing “store of the future” experiences for their shoppers. Nearbuy is a key component of this new, multi-channel experience, helping Kiddicare create an easy-to-use guest Wi-Fi network complete with automatic authentication for returning users. Nearbuy also helps Kiddicare tie their customer profiles together so they have a single view of the customer, enabling Kiddicare to market to the shopper based on all their methods of shopping. Nearbuy deployed this service in conjunction with the store’s Cisco-based (NASDAQ: CSCO) WLAN and is integrating data with Kiddicare’s instance of Salesforce.com (NYSE: CRM).

2013: The Year of Personalization in Retail

Wed, 09 Jan 2013 18:05:00 GMT

Our big predication for retail this year? Personalization. It’s been around on the web for over a decade, spearheaded by Amazon. For many, the key usability feature on Amazon is the product recommendations based on previous purchase history. I personally find it incredibly helpful that Amazon remembers what I bought and lets me know about other items that are similar, adjacent, and even just purchased by others who bought the same product that I did. As an example, I recently bought a TV wall mount bracket and Amazon was there to recommend that I also buy that new power drill I had been looking at and of course a set of new bits that I would need to drill holes. Original basket size: $25. Final purchase amount: $75. This type of personalization is a major differentiator and sets many of the pure play e-commerce providers apart from their brick-and-mortar competitors.

Well, we believe that a new form of personalization is going to come to a store near you...soon. Most multi-channel retailers have already incorporated personalization into their web sites thanks to technology platform like ATG (NASDAQ: ORCL), GSI Commerce (NASDAQ: EBAY) and start-up RichRelevance. Now we are seeing the beginning of integrating this technology into the in-store shopping experience. Retailers are already able to collect vast amounts of information from POS and loyalty programs. Now the challenge lies in tying this past purchase behavior with the presence and identity of a shopper once they enter a store. Most organizations want to make shopping an omnichannel experience, one where an online profile is also added to the offline data about a shopper. Their ideal shopper experience is that once you enter a store, you can get product recommendations based on who you are and what you bought across all channels with that retailer.

Personalization leads to an increase in sales for the retailer and a better, more productive experience for the shopper. It’s a true win/win scenario that justifies the cost and expense for even the largest retail organizations to undertake.

Wi-Fi in retail, but will shoppers connect?

Wed, 11 Jul 2012 07:00:00 GMT

Smartphone-toting shoppers and their impact on retail are making big headlines these days with several articles and studies about “showrooming” - when shoppers browse retail floors to test-drive products, but ultimately make a purchase from Amazon or another online source. Retailers are already experimenting with tactics to combat the more fear-inducing aspects of this new behavior, but they may find a better return by improving their own digital interactions while the shopper is in the store. To that end, some retailers are trying to entice shoppers to use their guest Wi-Fi instead of cellular data.

What’s behind the shift from concerns about showrooming to embracing in-store Wi-Fi? Increasingly, retailers acknowledge that they can’t stop shoppers from getting online and from making the internet part of their purchase process. Early on, the opposite was true: retailers were afraid that price transparency would be an end to their business model, and some even threatened to cover their facilities in
metal cages to block any kind of communication signal. The reality is that these tactics only drive shoppers away from the store and back online where they can check reviews, compare prices and do other research to make an informed purchase decision. Savvy retailers realize that making it easy and convenient for the shopper to do their research in the store is the winning strategy. The longer the shopper stays in-store, the more likely they are going to buy and the more they will purchase.

But why would a shopper connect to a store's Wi-Fi network versus their existing 3G/4G connection?

As anyone who has shopped in the back of a large warehouse-style retail store knows, cellular data connections don’t always work well indoors. That, along with the shift away from unlimited cellular data plans, makes the option of free, high-speed internet access an incredibly attractive amenity to shoppers.

Mobidia recently came out with a white paper comparing smartphone Wi-Fi to 3G usage. Given that a smartphone user needs to take an explicit action to connect to a Wi-Fi network (vs. the default option of always-on 3G data), conventional wisdom would predict that 3G usage would be significantly higher than Wi-Fi. But Mobidia’s study found that a large amount of data usage is already going over Wi-Fi, particularly for applications like web browsing, YouTube, and social media. It would seem that shoppers are ready, willing, and able to use in-store WiFi networks.

Why does this matter to retailers?

By directly providing internet service shoppers via their smartphones (versus having a carrier disintermediate them), retailers have another opportunity to learn more about what is relevant to their customers as well as getting the credit for enhancing their overall shopping experience. Guest Wi-FI networks are not only seen as an amenity to the shopper (keeping them in the store longer) but can be an additional source of business intelligence and act as a new direct form of communication, bridging the digital and physical shopping channels.

Best Buy and showrooming: If you can’t beat them, show them

Mon, 21 May 2012 20:04:00 GMT

The future of retail is an “omni-channel” experience, which means selling to consumers on all channels –online, mobile and in-store – simultaneously.

Retailers of all categories are trying to understand the massive transformation in shopper behavior brought about by the mobile internet, none more than the electronic retailers like Best Buy. The author of this article, Christopher Krywilak, expertly puts it that retailers need to sell to the shopper in all the different channels they offer, simultaneously. It is no longer a viable strategy to assume that shoppers won't have every piece of information about a product or service in the palm of their hand. Retailers must embrace showrooming and devise new strategies that leverage the shoppers ability to conduct all the research they need, right there in the aisle of the store.

One interesting concept is how to turn showrooming behavior into a financial reward for the brick-and-mortar retailer. At the end of the day, the intent of manufacturers is to sell their wares, independent of channel. Retailers play a critical role in allowing consumers to touch, trial, and feel products before they make a purchase decision. If a retailer can prove their role in a sale, manufacturers will be willing to compensate them. We see this today with retailers charging for shelf space, in-store signage, etc. There is no reason Best Buy shouldn't be able to report the number of units of products they sell direct to the shopper and the number of units they were part of that sales process. With the appropriate in-store technology, the Best Buy's of the world will be able to report on their value in selling to the consumer.

Link: Best Buy and showrooming: If you can’t beat them, show them - Mobile Commerce Daily - Columns via www.mobilecommercedaily.com

Make Friends with Showrooming

Wed, 09 May 2012 17:57:00 GMT

Link: MediaPost Publications Retailers: Make Friends with Showrooming 05/09/2012 via www.mediapost.com

Showrooming continues to be a hot topic in the retail community, often being spoken in the same hushed tones as a three year old mentioning the "monster" underneath the bed. Retailers are coming to grips with this new threat, and more importantly the change in shopper behavior, by developing strategies that allow them to interact with the shopper throughout the new path to purchase.

The first step in designing these new strategies is to gain a better understanding of how the shopper is interacting throughout an omnichannel experience - a new form of retail analytics. It is not enough for a retailer like Target to start demanding unique products that can't be price shopped online, what they need to do is truly understand which products are actually being showroomed. Trying to fight the "boogeyman" across all product categories carried in a mass merchant is crazy (i.e. boiling the ocean). Instead, merchants need to understand which product categories and/or the specific products where they are losing the battle. Over time retailers can learn which products are most at risk at specific store locations, giving them a leg up against their online competitors and taking the fight to where the showrooming battle is actually taking place.

Retailers have done a good job handling the first step in the showrooming era, admitting they have a problem. The next step is to gain a deeper understanding of what is actually happening so they can begin to take action.

The Cloud, Big Data, and Retail Analytics

Wed, 07 Mar 2012 08:00:00 GMT

The cloud. Big data. Analytics. If you think these are just marketing catchphrases you're missing a big opportunity - and a trend that gives retailers a leg up on their fast growing internet-only rivals (watch out Amazon!).

At Nearbuy Systems we've been very busy fine-tuning our guest WiFi analytics solution, which gives visibility into what shoppers are doing when they use their smartphones inside a store. We can show a retailer exactly which web sites, search terms, product review sites, and even product price points that are the most relevant to their shoppers at any time. Our solution collects a mountain of data across a highly distributed environment (think thousands of retail stores). It then sifts through it and then presents trends in a meaningful way so that management can take action. Just a few years ago this would have been an impossible system to build, or at the very least a hugely expensive one.

Luckily for retailers, we now have the cloud - or more specifically, the ability to quickly scale up low-cost computer power. Before the cloud, a solution like ours would have required computers at each store location to collect the data and then forward it on to another farm of larger servers to process and analyze. With services like Amazon's Elastic Compute Cloud getting cheaper every day, all of this can happen remotely in one massive environment. For a provider like Nearbuy Systems and our retail customers, this means that we can effectively scale up thousands of locations at a moment's notice. This also means that we can write software that chews through tons of data in an extremely cost-effective manner. We make it affordable to turn big data into analytics that drive important business decisions.

The cloud comes with its own set of issues, and sometimes we hear concerns about data sharing and privacy implications. In our case, the cloud is really just a more efficient compute center. It does not mean we are sharing or aggregating data. Data privacy is paramount for both consumers and retailers and great care is taken to preserve the integrity of data - just like in any other data center environment. For our solution, the cloud is simply a more efficient and scalable way to deal with the massive quantities of data and other challenges that come with large and disperse networks.

Guest WiFi Analytics in Retail

Thu, 19 Jan 2012 23:05:00 GMT

Analytics has become one of the major driving forces behind retail over the last few years. Retailers have learned that the more they understand about their customers, the better they can service them and more likely they can create valuable repeat and loyal shoppers. Along with this trend of gaining better insights, shoppers have also increased the amount of due diligence they perform before buying products, and mobile technologies are a key enabler.

This last Monday, at the NRF show in New York City, we announced the availability of a captive portal solution that brings a new slant to traditional retail analytics. With over 40% of the population carrying smartphone devices (and growing), retailers are deploying guest WiFi networks that improve the overall shopping experience in their store. With these new networks comes an amazing opportunity for the retailer to even further understand their customer. In his blog post Andrew von Nagy stated:

Analytics are the un-sung driver behind retail Wi-Fi hotspots. As I have previously written in 5 Retail Trends Driving Wi-Fi, retailers want to know who their customers are in order to tailor the in-store shopping experience which helps drive customer satisfaction and ultimately increased sales and profit. Consumers are increasingly using and relying on digital communications while in the store to perform product research, price comparison, and to make purchases. Retailers want the same reporting available from physical stores that they already get from their websites. The ability to tap into this information by offering free Wi-Fi to shoppers and report on usage is one of the main reasons retailers are offering hotspots in increasing numbers since late 2010.

Use of mobile devices in the store brings together the best of the online and offline shopping experience. Shoppers want to seamlessly navigate between these channels and retailers want to be able to understand how these channels converge and how to provide the best experiences. With these new use cases, Nearbuy provides a window for the retailer to learn more about the shopper and where to focus their energies.

The Smartphone and the Revival of Impulse Purchases

Mon, 19 Dec 2011 17:44:00 GMT

From mobile payments to enhanced loyalty programs, location-based coupons and in-store mapping, the smartphone is one of the biggest game changers for retailers since the advent of the credit card. But if you think about the smartphone as an independent piece of technology you’re really missing the point: with the right infrastructure in place, the smartphone can not only level the playing field between brick-and-mortar and internet retailers, it could actually reverse the trend of market share going to online stores. Let me explain.

It’s no secret that as consumers have become more comfortable with the internet and e-commerce, the way they shop has changed drastically. Forrester Research published that half of all purchases have an online component associated with them. From researching product reviews and asking the advice of social networks to doing price comparisons and checking for rebates, consumers have not only become more discerning but they have changed their methods of shopping. Gone are the days where shoppers made their purchasing decision solely in the store. Instead, they are doing it from home, work - or wherever they can access the internet.

Enter the smartphone! Shoppers can now complete the online component of their shopping anywhere, not just anywhere they have a computer or laptop. Providing guest Wi-Fi is an open invitation from the retailers to the consumers to seize the advantages of the online and the offline shopping experience. By offering free guest Wi-Fi, retailers enable consumers to do all their online research in the store, and also scrutinize and handle the product they are interested in. And nothing compares to the instant gratification of buying it in the store with the comfort that they have done their research and they are getting a good price. The price doesn’t have to be the same as lowest online price - it just has to be close enough to offset the additional value the consumer receives from buying their products within the store, such as taking the product home with them immediately as opposed to waiting, and having the ability to easily return the product to the physical store if they need to instead of shipping it back to the online retailer.

Retailers who embrace this new paradigm - accepting this new shopper experience and encouraging and enabling users of smartphones in their stores - have a lot to gain and can take back the momentum that the e-commerce retailers have won from them. This is my 2012 battle cry to all retailers: Open up that in-store WiFi! Make it easier for shoppers to use their smartphones, because they are going to use them, whether they’re in your store or not. Embrace this change and you have a chance to open up a powerful new retail channel.

If you are in retail, any reasons why you wouldn't want shoppers connected to your store WiFi?

Amazon declares mobile war on brick-and-mortar retailers

Wed, 07 Dec 2011 08:00:00 GMT

Amazon announced that December 10th is the day that their physical store competitors officially become show rooms for Amazon. Amazon is offering up to $5 off products if a shopper is willing to go into a brick-and-mortar store, look at a product, then buy it on Amazon. Amazon has long represented a threat to the traditional retail sector, but for the most part it was only a direct threat to those retailers' online channel. As shoppers have adopted smartphone technology, Amazon is capitalizing on the blurring of these retail channels and now can attack retailers where it hurts the most, within their stores.

I have written a bit about how online is growing rapidly but still only represents a small percentage of any retailers overall sales volume. The soft underbelly for most retailers has been that store environment, where the lions share of any annual sales takes place. With smartphone technology Amazon has found a very interesting way to disrupt the physical store channel and potentially attack a market that is 10x the online business they pursue today.

So how will retailers respond?

Our first recommendation is that they better get a handle on how big of an impact this is making today. Most retailers understand that their store business is being cannibalized today by shoppers purchasing items on their smartphones from within their stores, but no one knows how to measure this. Does it happen once a day or once a second? Retailers need to figure out in a hurry how often this is happening and measure this trend over time. Nearbuy has some specific ideas on how to accomplish this through guest WiFi networks - helping retailers understand exactly how online content is impacting the store experience (i.e. what content is of the most interest, what are shoppers searching for, etc.). These analytics will allow retailers to truly quantify the impact of Amazon and other online content sources on the store shopping environment, and can help power them to defend such tactics. With knowledge comes great power...

Second, retailers better figure out how to offer a mobile in-store solution that provides an even better experience than the Amazon apps. Price transparency is the tip of the iceberg here, table stakes for a converged multichannel experience. So retailers need to play off their strengths and leverage the fact that they have the shopper in their store. Any mobile offering they role out needs to integrate store staff, local inventory, and the fact the shopper can get immediate gratification from buying the product from the store.

2012 is going to be a very exciting year for retail and as shoppers we will see fundamentally new and exciting ways to shop that leverage the best of the offline and online channels. Retailers who plan on being successful are going to have to take this new mobile fight to heart.

New Retail Trends in Time for the Holidays

Wed, 02 Nov 2011 07:00:00 GMT

The NRF recently released a post with their top 10 trends for the holiday shopping season. With most retailers expecting a disproportionate amount of annual sales in the Nov - Jan timeframe, these trends exemplify the strategies of most major retail chains. Many of these trends focus on what is happening within the macro-economic sphere (GDP is up, jobless rate is slightly down) and how that impacts shopper sentiment. What I found to be really exciting were the areas where new technologies (versus market conditions) are starting to impact and change consumer behavior and how these are making their way into retail trends.

1st nugget of gold:

Today’s consumer has high expectations – they already assume retailers will be offering low prices or strong promotions, and they want to know what they’re going to get on top of that. This “price plus” shopping mentality is all part of the value equation, which incorporates price with other elements like quality, convenience and service.

Shoppers expect more. Even as times get tough and people look for the best deal, service and overall value of the shopping experience rises to the top. Online retailers have such a cost advantage over brick-and-mortar stores yet the vast majority of commerce still happens in the real world. This lead is shrinking at a double digit rate for the physical store, but the cause is much more than just cost. The "experience" matters and retailers must find new and innovative ways to delight their customer.

2nd nugget of gold:

Half of Americans with smartphones will use their devices for holiday shopping this year, according to our survey – primarily to research products or compare prices but also to find retailers’ information like store hours and locations. Consumers will also use phones while shopping in stores to read reviews or redeem coupons – while a smaller number (16%) will actually use their phone to make purchases. So when you think of smartphones, think mobile. These devices are carried everywhere.

Mobile is everywhere and the ability to bring the internet into the store has forever changed the shopping landscape. Google has created an entire initiative to help business improve their mobile web sites. As the look and feel of content on the mobile web improves, usage will only increase. Retailers are in the infancy of embracing the mobile web and probably won't put major initiatives in place to impact holiday 2011, but it is coming and is going to be coming fast.

The Business of In-Store Mobility

Wed, 14 Sep 2011 03:57:00 GMT

I have written a bit about how the smartphone is a game changer in retail, impacting the way consumers shop in so many new and exciting ways. Mobile brings many benefits to the shopper including the ability to do product research in the aisle of the store, compare prices in real-time, and connect to social media to garner peer recommendations. We are now seeing the advent of other in-store services like product navigation (where is the soap?) that will save shoppers time and improve their overall experience. Retailers are seeing the benefits of bringing the online world into the physical store shopping experience.

However, the mobile device revolution doesn't just impact the consumer. We are starting to see a trend where the major retail chains are arming their employees and store managers with the very same technology that the consumer is using. There have been several high profile announcements where these retailers are engaging their store associates with mobile technology in order to dramatically change the way they do business.

In probably the largest announced roll-out, Lowe's plans to deploy 42,000 iOS based devices in their 1,700+ stores. The initial application for these devices is to allow store employees the ability to access the lowes.com site, check product inventory, and access "how-to" videos. At some point these devices will also be capable of conducting POS transactions so associates can close a deal in the aisle of the store. Home Depot made a similar announcement earlier in the year where they plan to spend $60 million on getting mobile devices into the hands of theirs store associates. In this case, they selected more hardened devices from Motorola as their device of choice. In both cases, these retailers decided it was time to get more online data in the hands of their sales people in order to bring information closer to the customer.

In the apparel industry, Nordstrom announced that they were bringing 5,000 iOS devices into their stores to be used as mobile point of sale terminals. Nordstrom, a longtime leader in customer service, intends to speed up the check-out experience and once again provide more information to customers through their trusted sales associates.

Looking deeper into what mobile POS brings, there is also the potential for it to free up more selling real estate while dramatically reducing infrastructure costs for the store. Retailers measure their performance on "sales per square foot" and in most large department stores, precious real estate is taken up by the cash wrap. By enabling mobile POS, Nordstrom and other retailers may be able to do away entirely with their check out aisle. Imagine the cost savings if the retailer didn't have to pay for these expensive check out stands (tens of thousands of dollars each, 5-10 per store, hundreds of stores...) and that area could be used to house more items for sale. Decreasing store costs while increasing sales per square foot is enabled by implementing in-store mobile technology.

Today the promise of better customer engagement, easier check out, decreased store costs, and increasing revenues are major drivers for these mobile device roll-outs. However, there are many details that will need to get sorted out before the true value of these programs can be realized:

How do you prevent theft if there is no formal check-out location?
Where do the electronic tags get removed and where do items get bagged?
What about cash transactions?
Is there enough WiFi coverage to ensure constant connectivity?

I am sure there will be many more logistical issues that will need to be resolved, but the upside is so large that I expect mobile technology in the hands of every store employee to become main stream in the next few years. Retailers will adapt traditional processes, like customer check out, because the payback is so huge.

Why Web Analytics Are So Lame

Fri, 29 Jul 2011 18:47:00 GMT

Most e-commerce sites today have outfitted themselves with advanced web analytics systems to understand who is using their site, which pages they go to, how much time they spend, etc. This makes a lot of sense in the online world since there really is no other way to monitor traffic and gain any insight into the customer. For pure-play internet companies, these analytics are a must have. However, most multi-channel retailers have also implemented and received the benefits of web analytics. I am sure the online team raves about the insights they are able to gleam into their customer and how much easier it is to do their job of providing a meaningful online shopping experience. Don't get me wrong, I do think these analytics are valuable to multi-channel retailers, but its time to start thinking about how to bring these insights into the portion of the business that can provide the most benefit.

As I have posted before, online transactions still only account for about 7% of all transactions. 90%+ of all retail still takes place in the store. Today store analytics consists of store employees and store management telling merchants what is happening, followed by merchants looking at monthly numbers to see what the effect of certain programs has been. Stores have always had some form of analytics, but in light of what we can get on the web they now seem inefficient and ineffective.

One of the biggest shopping trends over the last year has been the incorporation of the smart phone and internet into the store environment. Customers want access to price comparison data, social media, etc. while they are shopping. Retailers have figured out that this data actually helps increase impulsive buys - having more information at the point of purchase makes the shopper feel better about grabbing something and buying it now versus going home to do research online. Since shoppers are bringing the internet with them into the store (via their smart phone) why not use analytics to better understand these new patterns?

Web analytics are not enough for the multi-channel retailer of today. The concepts of being able to identify a unique shopper, understand what they are interested in, see where they go in the store, and know when they want help from a store sales person, those are the new analytics of this retail age. The smart phone changes everything in retail and it's time for a new regime of analytics to help retailers better service all of their customers.

3 Lessons from the 2011 Top 100 US Retailers

Thu, 07 Jul 2011 20:29:00 GMT

Stores.org recently released their annual report on the Top 100 retailers in the US and its a great reminder of the economic impact these organizations have on our economy and the incredible opportunity they represent to companies providing solutions in this vertical market. It came as no real surprise to see Wal-Mart, Kroger and Target take the top overall spots based on combined sales of over $450B across the 10,000+ stores they operate in the US.

As we analyze the list there are three very interesting trends that emerge:

1. Sales per store really matters - retailers are constantly trying to figure out how to drive more sales per store and the retail winners show their dominance in this category. Just looking at the top 3 we see a huge disparity with Wal-Mart at $71M, Kroger at $22M and Target at $38M. Not only does Wal-Mart dominate the retail category for overall revenue and number of physical stores, but they do an excellent job of sales per store. The overall category leader for sales per store is Costco with over $143M in sales per store...an astronomical number and speaks to the massive volume they are able to turn. Along the same lines there is another trend of moving to smaller store formats, which is a bit counterintuitive to growing sales per store. The article points out that less than 1/3 of all Best Buy stores are located in the US but account for over 72% of the total retail square footage for the entire company. Best Buy, like many of the pure play electronic retailers before them, has come under pressure from their online competitors and is looking to smaller format stores to compliment their online presence. As retailer focus more of multi-channel selling it seems that the store is becoming more of a compliment to the online channel and vice versa.

2. Advanced use of customer data is driving results - retailers who take advantage of loyalty data and can personalize offers will be the winners. From a vertical standpoint, Kroger's continues to show strong results despite other grocery stores lagging. The article points out that their use of customer data is a key contributor and the ability for Kroger's to target offers and promotions that are tailored to the individual shopper may be the major differentiator. As we see more traditional retailers incorporate traditional online tactics, like targeting, into their normal offline business processes we can expect to see similar gains.

3. Online is growing REAL fast - Amazon entered into the top 20 this year and had amazing growth rate of 46%. Online still represents a small fraction of all retail sales (less than 10%) but it the fastest growing channel for most retailers. Retailers are acquiring pure play e-commerce companies, investing heavily in their on-line presence and even acquiring social media companies to help advance growth in this area. As the investment grows in this sector the retailer is going to have to ensure a consistent customer experience across their different channels and figure out how to integrate the best of the online and offline worlds.

In aggregate these 100 retailers represent over $800B in annuals sales, 200,000 store locations, and millions of jobs in the US alone. There are new trends amongst these top retailers like multi-channel shopping that will have lasting impacts on our economy as well as how people will shop in the coming years.

WiFi coming to a store near you

Fri, 24 Jun 2011 13:19:00 GMT

Wireless LAN technology (aka WiFi) has had a tremendous run over the last decade. What started out as a consumer technology, quickly invaded the enterprise and began popping up as the network access method of choice by users in universities, healthcare, and traditional corporate environments. Interestingly enough, retail was one of the first vertical markets where WLAN had its first success. These deployments were not nearly as glamorous as what we see today in a leading university because they were mostly used as part of a back office function - inventory tracking.

Now that WiFi has become mainstream, we are starting to see new applications of the technology that promise to make our ability to connect, at any time, that much easier. Deloitte wrote their predictions for 2011 and one that I agree whole heartedly with is:

"Deloitte predicts that in 2011, 25 percent of North American big box and anchor tenant retailers will begin offering free in-store Wi-Fi access to shoppers. In 2012, the proportion should continue to rise in North America and start to spread around the world"

Once again we will see retail take a leadership role in a new application of WiFi, this time it will be as an "amenity" feature. Retailers understand that smartphones and online commerce are playing a bigger and bigger role in the in-store shopping experience and that this new trend ultimately makes purchasing easier. At first most retailers feared that shoppers would use this new technology to price shop their products, but most have quickly realized that as long as their prices are somewhat close, the convenience, personal touch, and instant gratification that only they can offer will ultimately lead to more sales. Again, from Deloitte:

"In-store Wi-Fi presents retailers with a number of minor challenges. Retailers will probably need to build more and better apps to enhance the in-store experience. They may also need to upgrade their Wi-Fi equipment and network connectivity to support additional connections. However, based on experiences from some early in-store deployments, the costs to address these challenges are not material to most large retailers."

The convergence of smartphones, free high-speed internet, and the "daily deal" phenomenon is fundamentally changing the buying experience. For retailers there is an immediate need to embrace this new technology and provide an environment that enables the shopper every step along their buying process. The retailers who get this - which already includes leaders like Nordstrom, Staples, and The Home Depot who have free WiFi access in their stores - will have a competitive advantage as the demand for online access while in the store continues to grow.

Mobile and its Impact on the In-Store Experience

Wed, 27 Apr 2011 07:00:00 GMT

I often get asked if I believe consumers are willing to use their mobile device when shopping. Some people tell me anecdotally that they never look at their phone when they are at the store - they are on a mission and the last thing they want to do is be interrupted by their personal device. Other tell me that for people to adopt a shopping application, load it on their phone, and actually use it in the store requires a significant change of behavior - and these types of required changes can sink a new company.

My simple answer is: I do think people will use their phone in the store. The fact is that this isn't a dramatic change of user behavior. People have been using their personal "devices" during shopping for a long time (paper grocery list?). Shoppers use their phones all the time in the store - if you don't believe me, look around the next time you are shopping. People are chatting away talking with their spouses, answering emails while waiting in line, having their kids play games to keep them entertained, etc. Now look a little closer...you will even notice that some people have begun to use their device to scan the barcode on an item to get more product information or check pricing. They have even begun to create lists on their smartphone (I do this all the time).

If using the phone makes the shopping experience even better than it is today then people will adopt the technology. It is not very hard to download an application or even connect to a WiFi network. People do this millions of times a day. To extend this to your favorite store is not a major leap of faith. To back up my claims:

50% of U.S. mobile phone owners use their devices to shop online or to assist while shopping in stores, finds a new report from Arc Worldwide http://tinyurl.com/3hbar2c
More than half of smartphone owners are using their devices to enhance their shopping experience by comparing prices, finding store locations and checking for discounts, including two-thirds of those under 35 http://tinyurl.com/4bqj9hm
Motorola Solutions’ annual holiday survey found that an overwhelming majority of retailers—87 percent—believe that shoppers can easily find a better deal using their mobile devices, so customer service aided by access to real-time information is “more important than ever.” http://tinyurl.com/3ba2yzt
A research study found that more than 70% of iPhone owners report using applications or their smartphone’s web browser to help them while shopping in-store, and 41% are making purchases directly from their phones http://tinyurl.com/4l5fxgv
Google claims that 79 percent of smartphone users in the United States have used their device to help with the shopping experience. A whopping 74 percent of shoppers that have used their devices as a shopping tool have made a purchase http://tinyurl.com/4ea7njv
9 out of 10 mobile users have accessed mobile web while at a store and approximately 50% of in-store mobile web activity is related to shopping http://tinyurl.com/69mwfn5

There is obviously a lot of data from some not so disinterested parties pointing to the fact that shopper behavior as is relates to mobile devices in the store has already begun to change. Shoppers are motivated by getting a better deal, getting better service, and getting what they want. The mobile device is a great catalyst for all of this and our changing shopping patterns are a reflection of the narrowing gap between the offline and online worlds.