Predicting where a technology such as mobile will be in a year, let alone 10, is quite a tough task. Understanding how it will have reshaped retail is trickier still, so InternetRetailing set Mobile Editor Paul Skeldon the task.
The one thing that can be said with any certainty is that mobile is going to reshape most aspects of life and business and that retail is set for some dramatic shifts. It has already started.
Christmas of 2015 has offered some useful pointers as to where mobile retailing is going. November 2015 saw the biggest growth in mobile traffic to retail sites, according to IMRG/Capgemini, growing 40% over the previous month, a 97% increase in a year. Shoppers are shopping with mobile.
However, that is only a part of the story. To predict the future of mobile retailing, how mobile is used across the whole purchase funnel has to be explored. The simplest development of how mobile will impact retail over the next few years can be summed up by the ‘omnichannel’ sobriquet.
A study by MasterCard found that 80% of consumers now use a computer, smartphone, tablet, or in-store technology while shopping. In 2016 and beyond, omnichannel will show no signs of slowing down. In order to keep up, retailers will need to merge their physical and digital systems to serve the modern ‘omni-shopper.’ In the purely online realm, mobile will merely be a platform through which shoppers access retail sites to buy things. No retailer today should not have a transactional, mobile-optimised website and an app, so in the next decade this will merely be just another way to buy stuff.
Instead, what the future of mobile retailing will really be about is in how it glues together the online and offline worlds and brings the best of both to any shopping experience.
“Consumers now expect a seamless and unified shopping experience and retailers will need to merge their physical and digital worlds to serve this new wave of shoppers,” says Pierre-Emmanuel Perruchot de La Bussière, General Manager, Vend.“We’ll see retailers make their physical stores stand out from the crowd by using ecommerce technology to transform the in-store experience, and more online stores will move into brick and mortar territory, whether through seasonal pop-ups or long-term stores.”
This in-store technology will be used across the shopping journey from marketing reach right through to payments and loyalty and beyond. There has been much talk about beacons, and the coming few years are going to see these, in one form or another, come into mass use.
Many people pooh-pooh beacons, but they will become a mainstay of the way the in-store and online retail worlds merge.
According to UK network operator EE, 41% of Brits – equivalent to almost 22 million shoppers – regularly ‘showroom’ by using their mobile devices to check for better prices – and a lot more besides – while in-store.
To many retailers, beacons will be the first line of defence. According to Juniper Research, nearly 1.6 billion coupons will be delivered annually to consumers via beacon technology by 2020, up from 11 million in 2015, as retailers seek to develop proximity marketing campaigns in and around their stores. 2016 will be the year they start to make an impact.
Juniper’s research observed that in-store beacons have consistently generated high redemption rates. It cited the case of the Chinese jewellery chain CTF (Chow Tai Fook), where a campaign in early 2015 saw redemption rates approaching 60%, resulting in a sales uplift of nearly £11m for the company.
Meanwhile, the research highlighted the opportunity presented by locating beacons outside storefronts, with the UK’s Proxama deploying a network of beacons in locations such as buses, taxis, shopping centres and airports. It argued that the introduction of similar ‘open beacon’ solutions could serve to drive both footfall and engagement.
Indeed, work by SmartFocus is looking to do away with the actual beacons themselves and is developing a clever way of using GPS, mapping algorithms and some ‘secret software’ to let retailers benefit from proximity technology without the constraints of complex hardware integration or maintenance, while still being able to trigger micro-location messaging to enable a contextual experience.
Rob Mullen, CEO at SmartFocus, says: “Every customer is on their own unique journey. Motivations to try, buy or stay loyal change depending on the individual making the choice. A brand marketer can ‘own’ that moment by using our Message Cloud technology to harvest and interpret data and create contextualised campaigns that are triggered by customer behaviour; not by their best guess.”
Juniper’s research on beacons and proximity also pointed out that the growth in contactless infrastructure and greater consumer awareness around NFC would lead to significant opportunities for proximity marketing in the medium term.
According to research author Dr Windsor Holden: “The launch of Apple Pay dramatically increased public and retailer awareness of NFC. As contactless usage accelerates at the point-of-sale, retailers will then move to incorporate NFC at all stages of the customer lifecycle, including loyalty and engagement.”
This rise in contactless is going to also reshape retail in stores through payments. The industry is already seeing the beginnings of the contactless payment revolution – contactless payments now account for one in 10 card transactions, and with contactless spend nearing £1bn a month, according to Barclaycard research – and mobile is going to drive this up.
Apple Pay is in its infancy, but for anyone who has used it, it is so quick and easy to use that you can see that once the limit of £30 has been lifted, it could be the start of a beautiful new way to pay. The argument with mobile payments has always been that it needs to simplify what is already a simple process: Apple Pay starts to do that.
In the future, this is likely to morph into payments becoming a seamless experience for the shopper. They scan and pay for the goods themselves or simply use a one-click or even a voice command to purchase.
In the purely online world, the mobile payments play will be a simple extension of one click tied to card or wallet, obviating the need to enter details ever. In the omnichannel world, it will be all about how to make the payment process seamless and easy, but it will also incorporate how to use that payment process and e-receipting to offer loyalty and rewards too.
The final piece of the mobile revolution will be how consumers use their devices to find what they want and assess it. Search using Google is very advanced already, but there will be, in the coming years, a move towards much more semantic-based searching, using real terms and context.
Handpick has already launched an app that uses what it calls “aesthetic searching”. The app suggests clothes based on the same way you would choose the outfit yourself – considering both the event and atmosphere. When looking for a dress for a ‘night out’, you can narrow down the results by mood by searching for terms such as classy, elegant or alternative.
This is crucial for mobile shopping as it makes it much quicker, reducing the faff of searching through dozens of options and tags simply to buy something you send back. It also marks a move towards making mobile shopping easier, sitting alongside PowaTag’s launch of ad recognition to its platform so that shoppers can point and buy from adverts without QR codes, card detail entry and all the other things that naysayers say are holding m-commerce back. It also builds on moves by other retailers, such as Net-A-Porter to use visual search to make mobile shopping easier.
Looking further ahead, it is likely that mobile devices will be voice controlled and talk to the user, probably through tiny Bluetooth ear pieces. This will allow for greater control and understanding between user and device and opens up the device to be a voice for retailers, within defined limits set by the user. It will also help filter out the bombardment of messages and offers that consumers are going to face.
The device will shift from being a remote control for life to being your personal assistant, much as it is in the film Her. It will become your best buddy-cum-interface with the vastness of the web.
This interaction with the device will fundamentally change how we interact with retailers and how retailers can interact with us. The main thing is that consumers won’t notice any of this happening. That is the real development we will see with retail is that shoppers will find themselves in 2020 and beyond doing all manner of wonderous things with their phones from seamless contact with retailers that combines online and offline worlds, paying without doing anything and getting rewards for just being there. They will be in seamless contact with each other, retailers and more and they will have the power of the web at their finger tips – perhaps even on their actual fingertips if their gloves are ‘smart’ – and they won’t even notice.
Retailers will have spent a great deal of time and money on making this happen and they will notice the effects: they will see more loyalty, less churn, greater spending and a level of understanding of their customers like never before.
FUTURE PAUL GOES SHOPPING
It’s 22 February 2020 and your intrepid writer is going shopping. Having been told by my iPhone 12X when I awoke that my house hub had talked to the fridge and cupboards and had ordered the groceries for drone delivery to my Pelipod later that day, I pull on my tartan three piece suit (tartan, three piece suits are to be big in 2020), pop my 12X into my breast pocket, insert my tiny Bluetooth earpiece and off we go.
My Tesla car opens as I approach and I tell it that I need to head to the mall. It drives me there, the 35th album by West Coast music legend Kelley Stoltz playing in my earpiece, my phone runs through my important messages for me, all the while fielding calls from Ian Jindal.
On arriving at the mall, I am greeted, via my phone earpiece, by PAM H, my Personal Automated Mall Helper, who tells me that there are some great offers on biker boots that I had looked at on Amazonbaba yesterday and talks me through the route to the shop.
As my wheely shoes perambulate me through the halls of the mall, someone points their Samsung Edge 9s at me to find out where I got that great tartan suit, and then looks on their imaging software as to what it would look like on them. They then order it and tell the drone to deliver it to them later that day. The suit retailer sends 1,000 loyalty points to my universal loyalty card as a thank you for effectively helping sell a suit for them.
I let the shoes guide me, only to find myself wheeling into Toys R Us… I suspect my son has hacked my shoes and programmed them to take me to look at hover cycles. I tell my phone to override and we continue to the shoe shop.
I find the shoe shop, where I am greeted by name and shown the boots in my size to try on and my phone whispers that if I get them now I can save €100 here if I use the voucher they have sent me – but if I go to another shop in another mall they are cheaper still.
I decide to buy them, scan the box with my phone and they are mine – the payment all taking place in the background. The e-receipt on my phone then tells me that I can get a free coffee within the next hour at Starbucks as a thank you from the retailer.
I check my pedometer and calorie counter on my watch and decide that a skinny white Americano could be ok. As I walk to the coffee store, I tell my phone to call Ian Jindal; he asks where he too can buy the tartan suit. I ping him the details and recommend some shoes to go
with it. Hopefully another bunch of loyalty points will come my way if he buys them.
As I queue for my coffee, which I pay for just by showing my face to the barista, the phone doing the rest, my phone tells me my friend Tim is also in the mall, should I message him? I say yes and the phone pings him. He joins me and I buy him a coffee (and bag more loyalty points).
After a relaxing chat about my latest novel’s sky rocketing sales, I leave the mall, via a different door to the one I came in. My car has driven round and is waiting for me, fully charged up, and we motor on home to unpack those groceries and put them away – some things