Armonk, N.Y. -- Mobile shopping rose in the second quarter while social media sales fell, providing an indication of where U.S. retailers may invest in order to capture the attention and loyalty of the digital consumer, according to a new report from IBM.
The IBM Retail Online Index, a cloud-based analysis of the online retail sector, reported that retailers experienced 15% growth in sales from mobile devices but saw a 20% decline in sales traced to social media based on a much smaller base over this three-month period.
The report identified several trends of importance to chief marketing officers (CMO), e-commerce leaders and customer service professionals. Over the second quarter consumers continued to embrace mobile devices as a shopping tool, with mobile commerce accounting for 15.1% of all online purchases, an increase of more than 14%. Despite this momentum retailers are still struggling to sustain substantial success with their social media efforts, evidenced by a more than 20% drop in social shopping.
One explanation for social commerce's failure may be the absence of a CMO and CIO alliance, which is critical as marketing and online commerce become increasingly technology-driven, the IBM study reported. The lack of this alliance hinders the deployment of integrated technologies capable of fueling effective social media efforts.
A second factor is marketing's inability to form a clear consensus on how to utilize social channels. As a result, the retail online index saw a decline in positive sentiment around social media, which according to the online index dropped from 25.1% in the first quarter to 18.6% in the second quarter. Leading factors for this shift were the lack of deals being offered by retailers through these channels, which were more prevalent in the first quarter.
“Shoppers today are shifting from a singular online approach to a multi-channel experience that includes both mobile and social media,” said Craig Hayman, general manager, IBM Industry Solutions. “As a result, retailers must be prepared to connect with their customers on all fronts, or lose them to the competition. As we enter the home stretch for the 2012 holiday season, we will continue to watch how CMOs and CIOs tackle these challenges and create social media efforts that deliver value to the customer while driving revenue for the business."
In other key findings:
- Total online sales for the quarter were down 2.3% over first quarter 2012.
- The second quarter grew by 2.3% and the average number of items per order increased by 2.6%.
- While the iPhone continued to rank one for mobile device retail traffic at 8.2%, Android surpassed the iPad, which finished at 6.8% and 6.7%, respectively.