It was a big season for online retailers. From November through December 2015, the final sales tally exceeded $83 billion (12.7% more than the year before). Cyber Monday alone ended up being the single largest online shopping day in history, generating over $3 billion in sales.
As consumers grew more comfortable with transferring digital dollars, mobile devices came out front and center. In all, 50% of shopping visits and 27% of online sales were driven by a mobile device. This was particularly prominent on Thanksgiving, where mobile surpassed desktop visits for the very first time at 57%, while driving 37% of sales. After the turkey and pies were eaten, people hopped on their mobile devices to find deals and make purchases.
The mobile gap: consumer expectation versus retailer reality
The growth we see in mobile is not a real surprise. After all, smartphones and tablets have become a primary gateway for the experiences we have with our surroundings; one can book a ride home in one minute and order a sandwich the next.
What is interesting, however, is the gap that exists between the mobile retail experience and consumer expectation. There are a couple indicators here; for instance, even with the holiday boom, we saw a notable difference between mobile visits and actual purchases (a 20% gap in the case of Thanksgiving).
Separately, a recent survey of 4,000 consumers – across four different regions – showed that less than 50% of respondents were satisfied with the mobile retail app and Web experience.
Retailers are no longer competing with each other when it comes to mobile: they’re competing with the mobile-first and mobile-only companies such as Uber and Instagram. These apps have set a high consumer bar, and it’s one that’s not always met.
Waiting for the beacon comeback
When the 4,000 consumers were asked about their expectations and needs, survey respondents clearly showed a strong desire for emerging technologies. One that stood out in particular was location–based services, where a mobile device could be used in conjunction with physical shopping. 16% of respondents reported they would take advantage of this often, while 51% said sometimes.
The concept of location in the mobile retail setting often gets a bad rep. When beacons first started generating buzz in 2013, it opened up a host of possibilities. Fast forward to 2015 and what people often envision is a scenario where a shopper enters a store, opts into connecting with the beacon and subsequently spends the next 24 hours swiping away a bombardment of ads and promotions.
Beacons can certainly be used that way, but to think of this as the primary use case would be a mistake.
Making the physical world digital
What we are really focused on with location is how it allows the physical world to be made digital. A mobile device can not only show a retailer that a shopper is physically present in the store, it can also be the shopper’s remote to experiencing a digitized environment.
Consider some of these examples: When a shopper enters a retail store, an associate already has their purchase and preference history pulled up on a tablet device to deliver a personalized in-store shopping experience. Or, if the store is equipped with displays, a shopper walking by would be shown something of relevance to them; person A might see a flannel shirt, while person B might see a pleated skirt.
Implementations such as these are already happening. In the last holiday season for example, we saw major retailers experimenting with an app feature that presented shoppers in-store suggestions based off pictures they took of clothing and accessories on the people around them.
As a retail decision maker, the first step here is to earn the trust of your customer and to entice them to opt into your location service. Once that’s done, you can identify ways to create a unique shopping experience.
Don’t miss the train
As shopping dollars continue to migrate online, retailers will find themselves having to be strategic when it comes to the mobile shopping experience, but also needing to continue making the in-store experience compelling.
By developing a relationship with customers and delivering valuable location-based services via their mobile devices, there is open ground here to differentiate. We can expect to see some retailers pinpointing the use cases that prove indispensable for their customers, while others may fall behind and play catch up.
This post was previously published here.