It may just be the aftermath of the Mobile World Congress in Barcelona, but all the talk seems to be about mobile commerce:
- eBay/Paypal expecting to process $7bn worth of mobile transactions in 2012;
- Facebook becoming involved in mobile payments;
- UK retailers seeing mobile grow to over 5% of their digital revenue;
- Our very own client Domino’s Pizza reporting over £10m in sales from iPhone alone.
Such enthusiasm is hardly surprising given the numbers involved. We are however even more excited about how it all fits in the wider picture of multichannel retail.
The Packaged Internet
We have entered the era of a “packaged internet” – one where apps, smart TVs, tablets, e-readers, gaming devices and other emerging platforms are eroding the dominance of the destination site. Indeed social networks have effectively created new channels within the open web itself.
For retailers, this rapid fragmentation of digital channels has accelerated the need for re-defining their multichannel strategy. What should that strategy include?
1 – Go where the customer is. Brands must be prepared to address each of these individual channels in turn, taking their product to the consumer rather than a continued reliance on the user finding them. If they don’t then you can guarantee someone else’s brand will do.
2- All touch points must be considered as a whole. Customers expect the same experience as they flip between channels and devices. In the case of mobile alone there have been too many ’rush to market’ efforts that have left retailers with disconnected and under functioning apps. They will frustrate consumers whilst at the same time draining marketing budgets.
3 – Connect online and offline. 2012 is the year when smartphone owners, at least in the US, will go over 50% , and vitally 77% put their phone to use while shopping. It is time for the ‘connected consumer’ - people using their devices to augment their shopping experience, from price comparison and suggestions to purchase validation through their social networks. As a result we are at last developing a direct link between the online and offline worlds leading to a better understanding of the customer as a whole, enabling the retailer to enhance the in-store experience and ultimately increasing conversion rates. The more the gap between digital channels and in-store understanding narrows, the bigger the opportunity for the retailer – especially as 90% of purchases are still made at bricks and mortar stores.
Make the most of mobile
In summary whilst all the talk currently is around mobile commerce, there is a bigger opportunity out there for those willing to encompass a broader approach to multichannel. Newcomers and established players alike should use the momentum behind mobile retail to develop a fuller more integrated multichannel strategy.
In particular:
- Optimum solutions require better APIs – a thankless task in the short term but one that will nevertheless reward in the longer term, as new platforms emerge and commerce becomes more distributed;
- Mobile sits nicely between off and on-line – it offers a great opportunity to create a more seamless experience for consumers and ensures in-store becomes a major part of the multichannel approach;
- Don’t be afraid to fail. Trialling new devices or platforms might not bring the commercial results anticipated, but they deliver invaluable learnings for the future.
Future Platforms strongly believe that retailers and e-tailers alike should be planning to execute effectively across all channels, looking for ease and consistency as their customers switch from one to the other.
We have been applying this approach to Domino’s Pizza since 2006, working across their e-commerce site, social media, in-store kiosks and more recently mobile.
The results speak for themselves: online sales at £183.1m, over half of Domino’s overall sales and up 43% from the previous year, with 13% of digital sales coming from mobile and tablets alone.
