Savvy BTS shoppers using smartphones, social networks to score deals
NEW YORK — Inflation-related concerns will prompt back-to-school shoppers to utilize certain shopping tactics, including smartphone and social network use, to save this year.
According to a back-to-school survey conducted by Deloitte, 86% of households reported that they expect to spend the same or more on back-to-school items this year, while 7-out-of-10 respondents cited higher food prices (72%) and higher energy prices (70%) as reasons they may scale back spending this season, followed by about half (51%) who credit the lack of improvement in the job market to their anticipated restricted spending. Among those surveyed, 65% said that low prices are the most important retailer attribute when it comes to back-to-school shopping.
In terms of how shoppers will plan on saving big this year, nearly two-thirds (64%) of respondents that own Web-enabled smartphones plan to use them for back-to-school shopping, while 3-out-of-5 (61%) will use them to get price information. Additionally, more than 2-out-of-5 (43%) will download discounts, coupons or sale information to their smartphones.
Deloitte also found that social networks will play a greater role in back-to-school shopping this year, with 35% of parents planning to use social networking sites to assist in their back-to-school shopping, up from 29% last year. Among these respondents, nearly 7-out-of-10 (69%) plan to utilize social networks to find out about promotions, while 44% plan to visit social networking sites to browse products and 28% will log on to read reviews and recommendations.
“Retailers need to be prepared for a consumer who is sensitive to prices, especially with the pinch households are feeling from higher gas and energy costs this summer,” said Alison Paul, vice chairman, Deloitte LLP and Deloitte’s retail and distribution sector leader. “Retailers should monitor customers’ reactions closely to recognize where they are flexible, and where promotions are necessary to drive traffic and generate purchases of higher margin products in the store.”
Ways that parents are planning on saving even more money include only buying essentials, reuse last year’s items and consolidating trips to save gas (55%, 26% and 28%, respectively).
“Price-conscious and/or time-constrained, consumers are navigating virtual and physical storefronts to get the information they want quickly and easily,” Paul said. “Retailers need to respond with an integrated experience. In short, they must unite the store with their online and mobile channels to enable consumers to easily access product availability, promotions and information. Retailers can also increase personalization through digital touch points. One example of this is to create targeted mobile advertisements that engage parents and students with advice and merchandise specifically relevant to their shopping preferences to help retailers increase engagement, conversion and loyalty this season.”
Some consumers earning higher incomes, however, show more confidence in their own finances and are less inclined to alter their back to school shopping this season: 82% among respondents earning $100,000 or more said their financial situation is the same or better than last year, compared with two-thirds 66% of respondents earning less than $100,000.
The Deloitte survey was conducted between July 5 and July 11 and polled 1,000 parents of school-aged children in grades kindergarten through 12.
Kohl’s awards youth for volunteer efforts
MENOMONEE FALLS, Wis. — Kohl’s Department Stores announced that it has awarded 10 students, ranging in age from 10 to 17, with a total of $10,000 in scholarship money for post-secondary education. In addition to the scholarships, Kohl’s will donate $1,000 to a nonprofit organization of each winner’s choice.
“These young leaders have proven the amazing impact that volunteerism can have on a community. Whether it’s organizing a charity golf tournament or honoring fallen soldiers over the holiday season, these efforts have collectively improved countless lives across the country,” said Julie Gardner, Kohl’s EVP and chief marketing officer. “The compassion, enthusiasm and leadership demonstrated by these 10 young volunteers is inspiring and admirable. Kohl’s is honored to recognize these efforts and share these amazing stories of what can be accomplished, regardless of age.”
This year’s winners were selected from more than 37,000 youth nominees nationwide for such volunteer efforts as fundraising for orphans in Iraq, creating artwork to raise donations and awareness for Autism and bike riding across the country to raise money for children with disabilities.
Mobile Strategy Dilemmas
By Sathish Kumar, [email protected]
Companies everywhere are successfully leveraging mobile technologies to increase conversion, revenues, loyalty and lifetime value from customers. As companies develop mobile strategies, there are important considerations to bear in mind.
A majority of leading global retailers already have some kind of mobile initiative in place. This interest in mobile resembles the Internet wave in the ‘90s when many companies jumped to put up a website without having clarity on long term strategy and where the returns were going to come from. The evolution of the Internet has taken its own course — from static to dynamic websites, free to paid content and back to free content, e-commerce, digital marketing and social media — and is still evolving. In the process some companies have succeeded, some are still trying to find the recipe for success while others have disappeared.
Many retailers are hurriedly undertaking mobile initiatives not wanting to miss the bandwagon. All too often companies jump in the mobile fray without a strategy and a roadmap. It is important that companies that take the next step are very clear on what they want to achieve and how they want to leverage new mobile opportunities. Some of the dilemmas include:
Dilemma 1: Breadth versus depth
The most important question every company needs to ask is how comprehensive and stand alone a mobile channel needs to be as opposed to how complimentary the mobile channel is with existing channels. For example, a popular e-commerce site launches a mobile site where its consumers can search and browse its product catalog, add products to the basket, checkout using mobile-enabled payment and redeem mobile-delivered promotion coupons. This is depth of offering as the mobile site offers fairly comprehensive functionalities to its consumer. On the other hand, another retailer provides location-based services such as redemption coupons while a customer is shopping at a store, which could positively influence the customer to buy the product. In this case, mobile technology is leveraged to compliment the brick-and-mortar channel by providing an “extra push” that helps the sale. This is breadth of offering wherein mobile services compliments existing online and offline channels.
While both strategies are not necessarily mutually exclusive, they do need a different set of thinking, different approaches, different maturity levels of enabling technologies and different cycle of adoption.
Two of the key challenges faced in the mobile channel are limited user interface (UI) space on a mobile device (this is changing with the advent of larger screen next-generation smart phones and tablet PCs and better rendering technologies) and security concerns around mobile payments. Even though mobile platform and service providers are continually working to address these challenges, these concerns are here to stay for now. It is essential for organizations to keep these current limitations at the center of their strategy and roadmap.
Back to breadth and depth, a strategy of breadth is less dependent on mobile payment security concerns as it can leverage other well-established channels for payments. Similarly, concerns around limited UI space for providing enhanced user experience are less relevant for providing complimentary services unlike an end-to-end shopping experience within mobile.
Unless you are willing to invest and take more risks to stay ahead in mobile, it would be prudent to initially pursue breadth-based mobile strategies, for example, by coming up with numerous complimentary services that would enable better conversion and improved revenues across existing brick-and-mortars as well as online sales channels.
However, keep revisiting the options as and when some of the current shortcomings are addressed that will enable more content delivery and enhanced security. This approach will allow companies to come out with more comprehensive strategies that align with the technical advances and move over to a depth approach over a period of time.
Dilemma 2: Extent of push versus pull
A key differentiator of the mobile channel is location awareness capabilities. Companies can target mobile users at a given location criteria at any time, which is likely to maximize the impact of its targeted communication. For example, a person walking through a large shopping mall can be targeted with specific promotions that may likely to result in a sale within the mall.
Mobile allows companies to target their existing and potential customers in a more effective way as mobile devices are seen as a personal, always-with-you device. This also sets up the next dilemma — when does it become intrusive? How much can be “pushed” to non-volunteering clients? How does the effectiveness of marketing campaigns vary from being push oriented versus pull oriented? There is no one answer to these questions as it largely depends on type of industry, laws in place and the type of services being offered. However, it is a good practice that these concerns are considered while developing your mobile roadmap. A best practice is to empower your customers to choose the timing and level of offerings they would like to receive and adhere to the code of conduct around privacy and personal data.
Dilemma 3: Apps versus mobile website
More and more companies are increasingly looking at building mobile applications. A mobile app does enable richer, faster and more user-friendly UI though it does have its own set of limitations:
- With thousands of apps in the marketplace, it is critical that the consumer finds value to download
- Need for keeping the apps continually updated for new features
- Need for maintaining multiple versions for different platforms – though there are new breed of platforms to help to better manage this!
If the benefit of having a mobile app justifies handling above challenges, it would make sense to build one. Otherwise, a nicely built and simple mobile website would serve the purpose as well.
Dilemma 4: Is mobile technology right for me?
If you are dealing with end consumers, the answer is YES. Keep in mind the breadth versus depth options and the impending challenges and limitations that current mobile technology offers. Draw out a clear strategy and a roadmap and think about possible future scenarios and how to leverage opportunities and counter challenges. Allocate resources in accordance with the roadmap. Don’t forget to add adequate validation points in the roadmap to ensure you are on track as well as to undertake necessary course correction based on new innovations and breakthroughs that become available in the market. With the convergence of mobile and social media, there is more to lose by not being ready to embrace new opportunities and by having a right strategy and structured approach.
Sathish Kumar is a senior principal in the Retail, CPG and Logistics practice at Infosys, and specializes on the demand-side of customer operations focusing in areas such as multichannel commerce, order to cash cycles, marketplace, customer service and loyalty. He can be reached at [email protected].