Doug Garnett’s Blog


Research Shows that Smart Phones HELP Retail

The tech theorizers have suckered us into a mythology – the one where the Four Virtual Horsemen of the Tech Apocalypse destroy whatever they touch.

So, as soon as someone saw the first retail store shopper pull their smart phone out, tech titans started taking credit for the destruction of retail. But, new Deloitte research (link here) suggests we might want to keep our retail outlets open after all.

Turns out that shoppers with smart phones are 14% more likely to purchase within the store than those without these devices. And while this has generated a few shock waves of dis-belief among the adherents of technological destruction, it makes sense – human sense.

What do YOU do with your smart phone in the store? Here’s my own short list (I’m sure many people do other productive things with their smart phones).

Make sure the price is “reasonable”.

Check the features of the product in front of me against others.

Browse a review or two.

See if a different variation is available at another location.

The end result? Instead of having to LEAVE the store to do my homework, I can make a decision quickly and at the point of purchase. In other words, my smart phone browsing makes me more likely to buy right now rather than postpone the decision.

And interestingly, “check for the absolutely lowest price on the thing in front of me” isn’t on my list very often – because it’s not that meaningful.

This is superb news for stores since the minute someone leaves the store, their likelihood of purchase drops dramatically. So we shouldn’t be surprised to learn, over time, that stores benefit more and more from smart phone usage. We also should begin looking at smarter ways to construct apps to assist consumers (not just bombard them with offers). Those apps can pay off with more consumers purchasing and more purchased each time.

Perhaps more importantly, it means that stores should not panic at rumors of show rooming. Instead, focus on two things. Deliver a value added for consumers who shop in your locations. And streamline the connection between your online store and your physical store. (It’s no longer reasonable to let online live in a silo.)

Tech Needs a Better Sense of Humanity. Seems to me that the tech titans skew off-track because they have difficulty handling anything more than a one-dimensional theory of humanity. One common way we see this is a suggestion that price is all that matters.

This price theory led to amazing GroupOn hype – for a useful service but not the broad industry game changer we were told it would be. It’s some nice automation of coupon shopping for those who are coupon shoppers.

The more human reality is that we live complicated lives. Sometimes price is critical & sometimes not. If I can find a $100 product $10 cheaper elsewhere, it probably isn’t worth the extra hour it’s going to take to get it. Or, the week I’ll have to wait to get it from an online source. Or hassling to remember the Groupon & to have it ready when its needed.

(As an aside, Apple seems to have the best sense of humanity in the tech biz. And that confuses their competitors when Apple products succeed where others have failed or with technology that’s not “bleeding edge”.)

This is old news. I’m also struck by how often tech titans tell us they are once again “destroying” something…only to learn the technology actually HELPS the thing they promised to destroy.

Remember the DVR? It was going to lead to complete TV ad ineffectiveness? Funny story. Turns out the DVR has INCREASED ad effectiveness. (More here.)

Anyway, the good news is that shoppers have retained their humanity despite tech’s attempt to turn us all into robotic price shoppers. And that means shoppers spend more in your store if they’re carrying a smart phone. Not a bad situation at all.

Copyright 2012 – Doug Garnett – All Rights Reserved

Categories:   Big Data and Technology, Business and Strategy, Communication, Consumer Electronics, Digital/On-line, Hardware & Tools, Human Tech, Media, New media, Retail marketing


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