In the future, even more than today, mobile will drive multichannel retail. Yet many companies are still failing to make the most of mobile. Paul Skeldon, InternetRetailing’s Mobile Editor, explains more in the latest IRUK 500 Dimension Report.
Ecommerce traffic volumes from mobile hover around the 50% mark in most studies and surveys. Ask any retailer and most will probably tell you that all the company’s ecommerce growth comes from mobile. Debenhams sees half of its online sales coming via mobile, while Burberry sees digital generally outperforming in-store. The future of retail is multichannel and this will be driven by mobile.
But is this reflected in the findings of this year’s IRUK 500 research in the Mobile and Cross-channel Dimension? Looked at qualitatively, the leaders of the pack are embracing mobile and making full use of all the functionality that it offers. Elite IRUK 500 retailer Argos considers itself to have a “proven digital store model”, which has allowed it to expand its business and utilise modern concepts such as click and collect, pop-up stores and franchises. As a result, Argos sees more than a quarter of its £4bn of online sales coming through mobile – that’s more than £1bn on mobile alone.
Similarly, House of Fraser, another Elite retailer and the top retailer in the IRUK 500 Mobile and Cross-channel Dimension, sees some 40% of its online sales also coming from mobile, with a year-on-year growth rate of 100%. It has long had a strategy of ‘mobile first’, redesigning its websites as far back as 2014 so that they work in a framework that naturally suits all manner of screen types and sizes, and was designed to be scrolled – truly revolutionary back then when everyone was still looking at above and below ‘the fold’ real estate.
However, what marks Argos and House of Fraser apart is that both retailers see mobile as not just a vital ecommerce sales channel, but part of an omnichannel retail offering.
These two companies set the gold standard in what is possible with mobile in a multichannel world, but as the examples of best practice featured in this Dimension Report demonstrate, the difference between the Elite that really get it and the rest is, in mobile, quite marked. Many retailers simply aren’t delivering the basics with mobile. As IRUK Head of Research, Martin Shaw, puts it, “The low-hanging fruit, the off-the-shelf functionality, is missing from the majority of retailer offerings.”
For starters, given how important mobile traffic is, just 41% of retailers in the IRUK 500 study had an app. Just 63% of apps we measured were transactional. Broken down by device operating system, 36% of the Top500 have an iOS app, 30% have Android and just 24% have both – that means that more than three quarters of the Top500 don’t have an iOS and Android app, a figure that’s worryingly low.
Of those that do have a transactional app, only 55% – a little more than half – have any sort of native checkout, the rest relying on pointing the customer to standard web checkout. This makes the process more cumbersome, sometimes adds more steps and is dependent on a strong network connection. All these factors are points where the customer may abandon the shopping process.
This worrying lack of insight into the use of mobile apps points to there being something of a paucity of ideas as to the true power of mobile in the omnichannel world. Consumers are keen to embrace it – and the traffic and sales figures show that they continue to do so – yet many retailers are floundering with not only how to meet this mobile need, but also what that mobile need is.
While this Dimension Report sets out which retailers do what well – and conversely, which don’t – it also offers advice on ways to look afresh at mobile strategy. Perhaps you work for a retailer that’s invested heavily in mobile, but what can the company still do better? Improvements are not just about deploying bleeding-edge technology: some of the tried-and-trusted and simple measures can help retailers right now at minimal cost.
What is yet to be ascertained is whether mobile cannibalises other channels or can actually add new customers. As this Dimension Report’s sponsor Boldchat sees it, shopping now isn’t about choice of channel, it is about using the channel that is right at the time. Customers are going to shop on the device they want to when they want to; the retailer’s challenge is to understand this, understand the context within which they are doing this and provide the right service.
Retailers also have to be prepared to ‘follow’ shoppers as they flit across channels. This is possibly the most important factor going forwards with a mobile and multichannel strategy: consumers will dip in and out on many different devices and locations in many different moods as part of the shopping process. Understanding this and building for it is going to be one of retail’s biggest drivers.
The Mobile Performance Dimension Report is distributed with this issue of InternetRetailing. You can also view a digital copy online at internetretailing.net.