5 Reasons Retailers Should Embrace Blurred Lines

Feb 07, 2014 8:27 PM  By

Today, more than 60% of the U.S. adult population has a smartphone, while more than 50% have a tablet. This mass adoption of mobile devices (for the purpose of this article, “mobile devices” includes smartphones, phablets and tablets… let the terminology arguments begin!) is driving dramatic changes in retail and commerce, and this year will be no different.

Notice I said “commerce” and not “ecommerce.” That’s because 2014 will be the year that mobile devices further blur, obscure and shred the line between physical and electronic retail. Here are five reasons why:

The number of mobile devices and the time spent on them overwhelm PCs
As a Canadian, and by default a hockey fan, I believe that marketers will have to follow Wayne Gretzky’s advice and “skate to where the puck is going to be” this year. Mobile devices are always with us, and the data they generate allows for a level of personalized knowledge never previously available. Retailers need to leverage this data in all their marketing campaigns (online and offline) in order to remain competitive.

Offline retail goes digital
Catalogs, coupons and circulars will increasingly be created first, and frequently for digital devices. Look for not only more digital editions of print publications but also more digital-only versions of circulars and catalogs with a level of publication frequency and personalization that would be prohibitively expensive or impossible for their physical counterparts.

These 3 digital Cs will become daily touch points for loyal customers and prospects, resulting in dramatically increased brand engagement. Print counterparts, however, will continue to support large volume seasonal events and mature VIP customers.

Showrooming will become a fact of life
Retailers will embrace showrooming with sophisticated geolocation offers, same-day shipping and no or low inventory pop-up satellite stores. Consumers are now accustomed to using mobile devices in-store to check deals and prices elsewhere, so retailers will begin to embrace this practice and retaliate with instant offers of their own. Big Brother will be watching…but instead of trying to get you to forget about that device in your pocket, you’ll instead get incentives for using it.

The success of same day delivery shopping
We live in a world of instant gratification. Google Shopping Express. eBay Now. Amazon Prime Air, aka, drones. Enough said.

Online experiences will become more about engagement
Just as lifestyle stores such as Apple, Sur La Table, Sephora, and Tesla engage customers in the physical world, online retailers must do more e-engagement to gain significant brand advantage over purely functional etailers. The typical online experience is currently way too functional (search, find, buy) and eschews best engagement practices from the physical world.

Two predictions: Amazon’s Kindle “Mayday” button will go beyond real-time tech support and move into shopping services; and Nordstrom and Neiman Marcus will offer digital personal stylists that complement real-world services.

Now in reality, these five factors are a big deal but perhaps, too much for many retailers to absorb. There will be some difficulty in adapting to the changing market.

Remember how long it took for web commerce to take hold? And how popular do the iPhone and Android phones have to be for retailers to optimize their email formats and websites anyway?

Yet, there are a number of forward-thinking retailers that have started to embrace the new mobile market:

  • eBay has made impressive moves in mobile and now drives over 40% of its business on mobile. You can bet these mobile transactions have valuable data that will be used for future personalized offers.
  • Google, eBay (via its Shutl acquisition), and Amazon are enhancing same-day delivery with big data-derived intelligence. Amazon’s recent patents in anticipatory shipping demonstrate the type of thinking required to move product closer to consumers who have demonstrated a higher likelihood of purchase. Customers will get addicted to this convenience, as they did with “one-click purchasing,” and begin to demand it.
  • Retailers like Nordstrom (and its HauteLook brand) have increased digital distribution of traditional catalogs, in addition to offering daily digital catalogs to more deeply engage with current customers and prospects. Companies like Catalog Spree, Publitas, Wishabi, eBates, and RetailMeNot are re-imagining catalogs, circulars and coupons to take advantage of massive digital distribution and hyper frequency at sustainable costs.

In 2013, we witnessed a massive shift in web traffic – with more than a quarter now coming from smartphones and tablets. What may be less obvious is the amount of e-commerce traffic generated within physical stores. And it’s only going to increase.

I expect innovative retailers (new and established alike) to continue to jump on these market changes and use them as an advantage against slower moving competitors as the worlds of commerce and ecommerce become one.

Joaquin Ruiz is CEO of Catalog Spree.