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Retailers see mobile as business essential but many unsure how to maximise potential

Retailers are increasingly seeing mobile as a business essential, but many remain unsure as to how to maximise its potential, according to the latest industry research from mobile marketing company Sponge.

GENERAL MERCHANDISE

Retailers see mobile as business essential but many unsure how to maximise potential

Retailers are increasingly seeing mobile as a business essential, but many remain unsure as to how to maximise its potential, according to the latest industry research from mobile marketing company Sponge.

The second ‘Mobile in Retail’ bi-annual report saw a big increase in perceived importance - the number of retailers stating that mobile was an essential part of extending brand or marketing activity doubled compared to the first wave of research last July, from 24% to 48%.
 
Moreover, of the 78 retailers who took part, over 90% said they now considered mobile as a very important or important direct sales channel.
Mobile internet is seen as the mobile must-have for retailers. 84% agreed that making sure websites are optimised for mobile will be crucial for 2011. Location-based services and apps were next, with 69% and 67% respectively believing these will play a significant role in the multi-channel shopping experience. Almost half of those surveyed (49%) said mobile couponing was most important, while a third said SMS.

Despite these findings, many retailers have yet to take action. While the number of respondents who have used mobile rose slightly from the last survey, 35% have yet to leverage the channel in any form.

The latest research also saw a relatively modest increase in the number of retailers optimising their websites for mobile; up from 32% to 40%. However, of the remaining 60%, over 80% said they plan to optimise their sites within the next 12 months – with the majority creating a site specifically designed to make best use of mobile, rather than simply ‘scraping’ their current website.

The number of retailers with apps has grown – from 32% to 44%. Compared to the widespread enthusiasm for the mobile internet, however, nearly half of the 56% who don’t currently have an app have no plans to launch one.
 
“Part of the challenge retailers seem to be facing is developing and implementing fully coherent strategies,” said Phil Gault, Client Services Director at Sponge. “Our second wave of research has found that only 42% of retailers use mobile to drive traffic to their websites or stores. That’s a massive missed opportunity. Similarly, there’s been hardly any increase in the number using mobile as a call-to-action within their ads (37% compared to 36%). What’s encouraging is that, in addition to overwhelmingly positive customer feedback, over half (53%) of retailers who use mobile are seeing evidence of sales from the channel. That’s a significant increase from 41% six months ago. So proof that mobile adds value in both hard and soft ways is growing.”

Sponge’s research saw evidence that retailers who moved into the space early are now adding extra elements to their original offerings.
Compared to the previous report, when asked about how they use mobile, product reviews were up from 19% to 39%; barcode scanning has grown from 15% to 26%; while allowing customers to compare prices with those of other retailers has more than tripled from 7% to 23%.

Those retailers with a mobile site or app (52%) had also added more functionality. The number of retailers showcasing product ranges was up to 59% from 46%, customer service solutions grew from 25% to 41% while those offering tools to help customers find stores or stock was up to 29%, from 17% last year.
47% said they enabled m-commerce from their app or mobile sites. This was only 1% higher than in July 2010.

While revenues direct from mobile remain relatively small – on average 1% to 2% - the survey found that retailers who have embraced mobile are already seeing excellent returns. Positive feedback from customers has increased from 65% to 82%; while 100% of those with a mobile site or app said results had either met or exceeded their expectations (compared to 82% previously).

The Christmas and January sales period led to retailers seeing an increase in mobile activity. Of those who had reviewed the data, 85% reported higher traffic, downloads or transactions. 

Sponge’s survey also looked at the use of mobile in marketing and advertising campaigns. Retailers who used mobile as a call-to-action within their promotional activity now appear to be using it across more channels. The most popular medium was TV - 66% of retailers that had used mobile as a direct response mechanism in advertising said they used shortcodes on TV spots. Print (60%) and POS (53%) came next.

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