Wednesday, 30 September 2015 15:51

5 ways mobile has changed retail forever

Smartphones are transforming so many aspects of marketing. Brick and mortar retail is no exception. Many retailers started taking mobile seriously when consumers began using phones to compare prices and get product information right in store aisles. At first, stores feared the phone, thinking it would send customers en masse to pure-play internet sellers that had lower overhead -- and lower prices.

Nowadays, though, many retailers view mobile as a massive opportunity for growing sales and customer loyalty. But whether friend or foe, it's clear that mobile has driven massive changes in how retailers go to market.

Here are five of the most important changes.

Prioritizing loyalty over acquisition
More and more of the world's most sophisticated retailers are upending their fundamental marketing strategies -- shifting from an approach aimed primarily at acquisition to one more focused on getting current shoppers to buy more. It's long been known that driving incremental purchases from buyers is 80-90 percent cheaper than finding a new first-time buyer. Even so, most retailers spent vastly more money on acquiring new customers than creating richer and more personal experiences for their loyalists.

As far as loyalty marketing goes, most retailers used to operate from the perspective that once won, customers should be easy to keep. Many also believed that investing resources on existing customers would lead to subsidizing purchases the retailer would get anyway.

As a result, acquisition program budgets were often 9-10 times as large as retention or continuity marketing budgets. Broad door-buster sales were designed to attract the promiscuous shopper that didn't choose a retailer out of preference or habit. TV and print schedules focused on attracting broad demographics instead of focusing in on the people that bought regularly with a certain retailer. In fact, many retailers used one-size-fits-all email and print blasts as the alpha and omega of their customer marketing efforts.

That's changed in a big way. Some progressive retailers have completely flipped those dynamics, recognizing that mobile and to a lesser extent online can enable more personal and effective customer communications that drive strong incremental sales. If you want a great example, look no further than Macy's -- those folks are masters at this.

Phones have become the center of loyalty points programs, personalized discount offers, virtual and personalized roto ads, and the like. They can enrich a buyer's experiences both inside and outside the store. They can also make consumers feel appreciated and valued. And because the phone is almost always with the consumer, they are far more trackable and accountable than old-school retail tactics. READ MORE

By: Jim Nichols
www.imediaconnection.com

Published in Retail News