Study: The price may not be right for retailers
Retailers are not feeling confident that their pricing strategies are satisfying consumers.
A new report on pricing conducted by RSR Research and sponsored by retail consulting and analytics firm Precima, “Pricing 2016: Life Becomes Unmanageable,” reveals retailers are worrying that consumers do not believe they are priced competitively enough.
For example, only 35% of U.S. retailers believe their company has a strategy in place to manage prices and promotions effectively across all channels, while 50% believe increased price sensitivity of consumers is a business challenge. Another 48% believe the largest challenge is pricing aggressiveness from competitors.
Forty-one percent of retailers cite not enough IT resources available as being a barrier to implementing effective pricing practices, followed closely by lack of price, competitor, and purchase data at 38%. And while personalized pricing is the goal for many retailers, 41% of respondents feel that internal challenges indicate nothing drastic is likely to occur near-term due to concerns over negative consumer reactions.
“Back in 2012, we began expressing serious concerns about both strategies and tactics, but retailers seemed convinced they could win the race to the bottom on price or at least, by participating in the race, they could stay in the game,” said Paula Rosenblum, partner at RSR. “Fast forward to 2016, and retailers are now starting to feel the negative impacts of their past pricing decisions. Consumers may be sensitive about price, but no retailer, not even the lowest-priced retailer, can win on price forever.”
Other notable findings include:
• Less than half of retailers feel their company pricing strategies are building customer loyalty and only 23% feel the pricing strategies are effective at driving bottom line results.
• Retailers are looking to replace early competitive price intelligence solutions and plan to invest in new capabilities around promotion optimization, markdown planning, and inventory management.
Simplification Can Help Retailers Adapt to the Mobile Movement
The story of the “mobile first” generation isn’t a new one. Retailers have been told for years that mobile should be at the forefront of business strategy in order to meet consumers’ evolving expectations.
Yet, there appears be a disconnect between existing mobile experiences and consumer sentiment.
A recent survey from Accenture found that only 42% of shoppers found it “easy” to complete a purchase using a mobile device, although 88% of respondents reported shopping regularly with smartphones. As the “mobile first” generation evolves into “mobile only,” it’s becoming increasingly important to address this disparity.
Failing to provide a seamless mobile experience can be quite costly for merchants – more than $1 trillion of total retail sales in 2015 were influenced by mobile phones, according to a new report from Forrester Research. E-commerce has gotten more complicated, meaning more often than not, retailers’ homegrown platforms are outdated and inefficient. While the options offered to consumers continue to grow, it becomes easier for buyers to disregard those that aren’t up to standard.
The Answer is Simple
The key to optimizing commerce for mobile is simplification. While retailers often offer multiple platforms, including both desktop and mobile, it’s essential that all channels are consistent – including pricing, products and imagery. Shockingly, the Accenture study found that only 32% of retailers offered identical cross-channel pricing. These sorts of discrepancies lead to frustration from consumers. To avoid a potential loss in revenue, merchants should focus on presenting a unified brand experience across platforms.
Developing separate sites, however, can be time-consuming and inefficient. Implementing an integrated content management system (CMS) will greatly reduce the resources and energy required to maintain multiple channels. Utilizing a CMS allows administrators to make updates across mobile and desktop simultaneously. This way, promotions and product updates can be implemented throughout sites at the same time.
Providing Comprehensive Commerce Experiences
An integrated CMS will do more than just streamline business. It will allow retailers to provide a comprehensive commerce experience, without hiccups between touch points. Taking advantage of tools, such as push notifications, can have a significant return on investment (ROI).
For example, as mobile usage increases, consumers are looking to take advantage of their devices in-store; about half of consumers would like to receive in-store promotions, although only about five percent of retailers enable them to do so.
Push notifications are a great strategy for addressing this, allowing discounts to be offered in real-time. While such deals can – and should – be implemented simultaneously across sites, offering promotions through push notifications can increase both consumer engagement and sales. Connecting consumers with the right deals at the right time can have a huge impact on revenue.
In-store offers are only one part of a comprehensive mobile strategy. Operating between platforms should be seamless, allowing consumers to begin a transaction on one site and finish on another, for example. When modernizing for mobile, this is the most important principle to keep in mind.
As consumers rely more on mobile devices, retailers need to be able to constantly evolve to meet changing expectations. Of course, offering top-notch mobile capabilities shouldn’t come at the expense of other platforms. Retailers should be able to centrally manage content, pricing, promotions, and customer communication across all platforms; customers expect their information and carts to be seamlessly unified, with payment options and preferences saved throughout the customer experience and across screens.
Together, retailers and technology partners should aim to create a cohesive experience in order to give customers flexibility and choice in when, where and how they buy your product.
Ani Gujrathi is VP of engineering at Mozu.
Las Vegas shopping center adds digital glitz
Miracle Mile Shops, at Planet Hollywood Resort & Casino in Las Vegas, is targeting customers online in a big way.
The 1.2-mile shopping center has relaunched its site to offer a comprehensive snapshot of its offerings while encouraging visitors to engage on its social media channels. Now optimized for mobile technology, the site lets users search stores, promotions and offerings.
In addition to its mobile accessibility, the site provides an updated mall directory. This interactive map allows users to hover over and search filter options that changes the map’s display. Other site features include:
Home Page Slider: Users can quickly find special announcements, video campaigns and store promotions all on the main page.
Sales and Promotions Page: Visitors can view the center’s events and sales in one location including branded graphics, storefront photos and sale images. Additionally, shoppers can filter through shopping, dining and entertainment related offers.
Socialize Page: Customers can now engage, follow and interact on all the center’s social media channels without leaving the site.
Store Pages: The site has added internal pages for all of its stores, allowing each merchant to have its own presence.
Shopping center operator JLL also recently expanded its digital customer outreach with the social “Go Shopping” promotion, and the Glendale Mall (a GGP property) in Southern California is offering pickup pods for online orders from Curbside. Malls are realizing they also function as retailers and need to perform omnichannel CRM activities accordingly.