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IBM study: Sales from mobile devices up 15% in Q2; social shopping drops

BY Marianne Wilson

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.

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Ace Hardware launches ‘Express’ store format for smaller spaces

BY Marianne Wilson

Oakbrook, Ill. — Ace Hardware has launched an “Express” format for both current Ace retailers and other business owners seeking to integrate the Ace brand into their existing offerings. The new, more compact stores average 5,000-sq.-ft. or less, and include customized merchandising displays and stock more than 11,000 of the most popular and profitable hardware products.

“At this time, there are nearly 400 successful Ace Hardware retail locations operating within less than 5,000 sq. ft., and the consistent high performance of these stores proved we had an incredible opportunity to create a specialized, smaller-format Ace retail model,” said Mike Berschauer, director, retail development, Ace Hardware Corp. “Our goal is both to drive incremental store growth for Ace and to mirror the ‘best in class’ offerings available at our larger stores. Essentially we’re providing the same top-notch brands and exceptional customer service, but just in a smaller space.”

The Ace Hardware “Express” format makes it possible for Ace to continue growing share in markets that aren’t able to accommodate additional full-size retail locations and is ideal for the following retail scenarios:

Ace will provide incentives of up to $150,000 to retailers utilizing the “Express” format. In addition, the company has created a variety of tailored resources to support these retailers – including merchandise profile guides, plan-o-grams to ensure that product selection is “shoppable” for customers, customized fixtures to create space efficiencies and a variety of incentive programs.

In addition, the in-stock product selection at “Express” format locations will mirror that available in a larger store model.

Currently, there are “Express” format Ace Hardware locations in six states across the United States – including Kansas, Massachusetts, New York, North Dakota, Tennessee and Texas.

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Judge scolds attorneys for rushing to court over Wal-Mart bribery allegations in Mexico

BY Staff Writer

New York — A judge in Delaware on Monday denied requests from the California State Teachers Retirement System and a group of New York City pension funds to seek appointments of lead plaintiff and lead counsel in a consolidated shareholder lawsuit over allegations of bribery involving Wal-Mart Stores’ operations in Mexico, the Associated Press reported.

The judge said the attorneys seemed more interested in filing sloppy complaints based on media reports, rather than demanding corporate records from Wal-Mart and taking time to investigate, the report said.

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