Overcoming the Barriers to Mobile Use in Stores, Part 1

This is the first installment in a two-part series that examines why mobile phones aren’t a larger part of the shopping experience in-store. Part one looks at data that reflects low engagement and explores the barriers to mobile use in-store. Part two will attempt to understand technology and the solutions it may (or may not) provide in gaining increased usage.Sooner or later, in just about every seminar on the potential of mobile and shopping in-store, the speaker describes a toddler he knows who’s an “absolute genius” on the iPad. Okay, “genius” may be a bit of a gush, but from a very young age today’s kids certainly know their way around a tablet and Dad’s old iPhone. What’s certain, though, is that today’s toddlers will grow up with a screen in-hand for virtually their entire lives.In that way, they are similar to today’s teenagers, who are “experience junkies” and don’t do anything without their “digital pacifiers” as The Integer Group’s Laura Davis-Taylor puts it. Data from the Pew Research Center shows that fully 37% of teenagers (ages 12-17) already own their own smartphones – compare that to nearly 60% for all American adults.“At the same time,” cautions Davis-Taylor, who is senior vice president, omnichannel experience, “teens still love physical socializing and physical shopping and, like their elders, will openly say, ‘If you didn’t get the best deal possible, then shame on you.’” But while Davis-Taylor fully expects today’s toddlers and Gen Z teens to grow up and be in-store screen shoppers, the question is how will they use it: To seek prices? Information? Loyalty? Fun?Until that time, today’s experimental playground of new technologies such as iBeacons, mobile apps and concepts like TouchCode (a conductive ink on packaging or signage that can directly communicate with the phone) is basically a primer on tomorrow’s shopper. That’s because the reality today, quite frankly, is that shoppers don’t engage all that much with the mobile phone in-store.A June 2014 survey of more than 1,300 shoppers from The Integer Group and M/A/R/C Research showed that only:7% find mobile apps useful;6% find mobile shopping lists useful;6% find text notifications from a brand or retailer useful;5% find location-based services useful;5% find games, quizzes and polls within the shopping site useful.Those in the younger demographics are only slightly more engaged when it comes to building shopping lists, comparing prices and browsing mobile websites in-store, according to the M/A/R/C data. Nearly 60% of those 18-24 years old said they use the phone to price shop while in a physical store, compared to only 30% of those aged 50-64; 40% of respondents 18-24 use the phone in-store to look up product reviews, compared to 20% of those over 50.Other surveys back up Integer’s data:The “2014 Mobile Behavior Report” from ExactTarget Marketing Cloud tracked 400 smartphone and tablet users, discovering that email and mobile websites see the most engagement. Barely half of those tracked followed any brand over social media or opted-in for text notifications; most said they don’t provide “meaningful content.” And almost two-thirds opted-out of sharing their location, with more than a third claiming it decreases battery life.PunchTab, a shopper engagement and insights platform, surveyed 1,000 mobile users on their acceptance of mobile tracking such as iBeacons. Half said they are concerned with privacy and only 27% are willing to allow tracking … provided it shows some benefit. One-third of users complained about intrusiveness of “too many” irrelevant messages. However, 90% were willing to opt-in for coupons and 72% would opt-in if it could shorten their time waiting in line.In “Digital Grocery Commerce: Exploring the Potential for Grocery Shopping Apps,” a survey of nearly 800 shoppers (published by FMI) cited “ingrained routine” as a prime reason shoppers weren’t engaging with apps: “They are familiar with their regular retailers and their specialties, either in unique offerings or known discounted categories, and their store layouts. The popularly promoted advantages of grocery shopper apps don’t appear essential to these potential users.” Single- and two-person households with smaller baskets found apps too cumbersome for the savings involved; larger households were diligent about saving, but found that apps under delivered and were frustrating to use.“We are in a state of flux,” says Terry Logan, group director, Digitail, Integer. “There’s a lot of talk about the possibilities of technology – whether it be QR codes a couple years ago, iBeacons today or TouchCode tomorrow – but it’s still a behavioral issue. We’re all similar in the way we buy because of the infrastructure of the economy and the way stores are set up. And we all train early on how to shop. So as marketers, we have to question ourselves: ‘Why do we think this will actually work?’”Shopper RoutineA rigid shopper routine seemingly marks the biggest barrier to more mobile use in stores, and it’s up to brands and retailers to invent a new routine. “What we as marketers need to understand is that technology will continue to have incremental gains until we find brands willing to shift personal behaviors for personal benefit. This happens outside of the store,” Logan says.Nancy Childs, professor of food marketing at Saint Joseph’s University, Philadelphia, who wrote the “Digital Grocery Commerce” report (part two is now available for free at the FMI website), says her research found that, at best, people are just transferring traditional shopping behavior into digital – go to this online source for a circular; go to that place for a coupon; go somewhere else for loyalty points. “We haven’t figured out how to really engage them,” she says. “They’re just engaging with us in their same patterns. We’re not helping to take them to the next level. Mobile apps can do a lot for them, but they’re not ready to go there.”Rich Donahue, director of marketing at Ibotta says that the brands and retailers “that try to invent a new routine are going to reap the largest rewards, and they’ll be pegged as the innovative thinkers.” He says that people are spending more and more time out of store with the phone and that’s where shifting behavior begins. For Ibotta, therefore, it’s a process of communicating with Mom while she’s waiting to pick up the kids or at home and thus, getting “top of mind.” Once Mom goes to the store, she just might check her Ibotta app because she remembers something she saw. She may not be fully engaging with the app but it’s a start, Donahue says: If she goes through this process enough times, it will become a new routine.Logan says the smartphone is a utility to shoppers. The marketer’s mentality should be: If you want her to use the phone, then it needs to provide a utility that’s different enough to benefit her life. A shopping list, after all, is a shopping list whether it’s on paper, in a text from a spouse or on an app.Joel Warady, chief sales and marketing officer of Enjoy Life Natural Brands, a gluten-free and allergy-friendly food brand, says the challenge is to make a shopper feel uninterrupted. He describers his brand’s philosophy as “one screen – we build our programs under the assumption that our consumers will start on one piece of technology, maybe continue on another and finish on a third.”Warady points to a technology called Destini, a locator or “where to buy” feature on the Enjoy Life webpage that enables shoppers to search by SKU and ZIP code. He says its consumers are often frustrated because tracking down a specific product and being told that the brand is generally available at a local grocer doesn’t necessarily help. With Destini, Warady says he can tell the consumer through geo-location where she can find the SKU and then, once in-store, send a notification through an app like Ibotta that the cookie she looked up two hours ago will cost 75 cents less using Ibotta or some other application.Donahue says a third-party app like Ibotta aims to be a complementary piece to a retailer. It takes time for a retailer to build an app, maintain it and update it as new technology arises, and if they don’t, that could have a negative effect on early adopters, he says. He believes the best way to fit into a shopper’s routine is for a retailer app to simplify and fulfill a need state.Childs agrees, saying retailers are overloading apps and that’s stifling engagement. She says her research pointed to shoppers not being interested in an app that does everything under the sun. “You need to engage them with what they’re interested in, as opposed to being an app that does it all.”More BarriersRespondents to the “Digital Grocery Commerce” report from Childs listed two sets of barriers toward using grocery apps:Mechanical concerns include worries that they shorten a phone’s battery life; the store layout pictured isn’t accurate; notification overload; memory hogging and slow response times in a store environment.Perceptual concerns include skepticism about the time vs. value proposition; insufficient savings; and privacy intrusions.Ibotta’s Donahue believes that “time vs. value” perceptions could change dramatically if the home delivery/store pickup experimentation of Amazon Fresh, Walmart To Go and Instacart – to name just a few – ever goes mainstream: “If changing my routine and not heading out to the supermarket gives me another hour or two with my kids, that’s a big driver.”One other barrier frequently mentioned is a retail staff disconnect: “A lot of chains have jumped into the apps, but they haven’t trained the front end,” Childs says, which is due to turf battles involving mobile, operations and marketing.Rick West, CEO and co-founder of Field Agent, an app that pays shoppers to perform audits or surveys, agrees – to a point. He says that at service-oriented retailers like Sephora or Lowe’s, a shopper can expect store associates to be trained on an app’s functionality, but it’s not fair to hold a clerk “in a Dollar General in Idaho” to the same standard.Brand, Retailer CollaborationOne reason so many mobile-phone shopping apps keep flooding the market is the promise of seemingly limitless shopper data. “Many of these new technologies are indeed great for the retailers and the brands,” says Logan of The Integer Group, “but they aren’t always great for the consumer.” He believes that if brands and retailers would properly share data, they’d build stronger mobile profiles and create digital tools that would not strike shoppers as intrusive or time-wasters. Unfortunately, the most effective partnerships he’s seen seem to be at the category management – but not strategic – levels: “You can have two aggressive category managers who push to make something happen, have synergies and are willing to test new technologies … but then the marketing teams get involved and the exuberance gets saturated.”Enjoy Life’s Warady says he often meets retailers who are pondering the installation of Wi-Fi in-store: “It’s 2014 and you’re still deciding whether or not people are going to use the Internet? It’s there. It’s like air. It shouldn’t be something you still have to think about.”He’s encouraged, however, by developments like Kroger’s pending acquisition of e-commerce site VitaCost. Warady believes the move is a step toward a future where shoppers will walk down digitally enabled aisles with their mobile devices and shopping cart, arrive at an Enjoy Life cookie section where Kroger might have three flavors on-shelf, but offer three more through VitaCost that can be delivered tomorrow. “That’s where everyone needs to head,” he says. “You can’t build bigger stores, but you can build bigger distribution centers.”About the SponsorThe Integer Group, a member of Omnicom Group Inc., is a promotional, retail and shopper marketing agency that lives at the “intersection of branding and selling.” Integer creates strategic marketing solutions for clients in categories that include retail, beverage, packaged goods, telecommunications, home and shelter, automotive aftermarket, and power sports. With U.S. headquarters in Lakewood, Colorado, it also has international offices in Africa, Asia, Australia, Europe, the Middle East, and North and South America.

Overcoming the Barriers to Mobile Use in Stores, Part 1

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