Smartphones – The Crucial Thread In The Fashion Retail Marketing Mix?
by Malcolm Pinkerton, Senior Director and Senior e-Commerce Analyst from Planet Retail
With the proliferation of blog shops and rise of online shopping in Singapore – and in Asia – the casual observer might be forgiven for thinking the brick and mortar shops will go the way of the Dodo. That’s not the case.
Yes, consumers enjoy the convenience and choice of online shopping, but they will always love the sociability of visiting enticing and compelling stores. Last year, online fashion site Doorstep Luxury opened a storefront in the Central Business District and Groupon opened up in Suntec City. What is clear is that online and offline shopping need to be seen as part of one coherent strategy. What is also clear is that smartphones are fast becoming the glue that binds the physical and virtual retail worlds. Indeed, they might just be the savior of bricks and mortar shopping.
But just how can mobiles achieve this? My company, Planet Retail, conducted a comprehensive consumer research into e-commerce in 10 key countries, covering mature and emerging markets including China, Japan, India and the USA. I will be presenting the results at the upcoming Asia Fashion Summit 2013 at the Raffles Conference and Convention Centre this month. These trends have implications for Singapore as they expand into the region and internationally.
In examining the findings from key e-Commerce markets, we can begin to paint a picture of what might drive and influence online shopping behavior in Singapore. By taking the lessons learned from other markets, we can help determine what might drive people to shop online in Singapore, what could influence purchasing decisions, encourage more shopping via the internet, what is important to them when doing so, and crucially how retailers in Singapore can appease the demands and expectations of online shoppers.
Let’s compare the US and China. Despite the differences in economies and geographies, we found some surprisingly similar threads in how consumers use smartphones to shop across the countries. Almost half of consumers in the US and China use smartphone access for shopping: both countries clock in at 49%. While 51% of American use their smartphones to stream video, music and games, 62% of Chinese do so.
Why such heavy mobile access in China? With fast and cheap internet access via cell phones, it is a typical way to go online, and has become a normal way to shop. Although the majority of online shoppers in China are more affluent and living in urban areas, the use of the internet in more rural areas via a cell phone will often be the only means of doing so. Indeed, almost half of internet shoppers in China have made a purchase via their cell phones.
How do Chinese consumers enhance their shopping experience via smartphones? Here are the top three ways: 48% have used their phones to redeem coupons or discounts, 47% have made a purchase online, have got more information or compared prices while shopping, and 46% have researched or read reviews while shopping.
In comparison, Americans surveyed typically used their phones to enhance in-store experience and aid purchasing decisions e.g. locate the nearest store (46%), compare prices when out shopping (41%), or scan QR codes (39%).
Mobiles are also increasing the sociability of shopping, with 23% of American and 38% of Chinese shoppers using social media on their phone to canvass friends’ opinions on items they are considering buying when in-store. Mobiles are also being used to provide real-time feedback. 21% of Americans shoppers surveyed using their phones to comment on in-store experiences via social media. China shoppers are even more social – with one in three shoppers commenting. Retailers need to encourage and reward this level of interaction, to create a social buzz around a brand and augment the shopping experience.
I must caution that while smartphones are used to enhance purchases, they only account for 17% of direct purchases online in the US, and 7% in China. Reasons include infrastructure issues and security concerns. This presents opportunities for retailers as well as infrastructure suppliers to enhance the shopping experience.
Many retailers, recognizing just how empowered consumers have become, facilitate this desire to read product reviews, compare prices and find offers before making a purchase. Unfortunately, those currently doing nothing to enhance the path to purchase in this way are at a huge disadvantage to their mobile-savvy rivals. This is even more important in a country like tech-inclined Singapore, where smartphone penetration is at 90% (source: MMA), and where shopping is the national pastime.
The internet continues to dominate our lives and shopping channels are becoming increasingly blurred. What is vital to note, however, is that all this means very little to the consumer. Seeing only the brand, they just want to shop, and to do so in the most convenient and enjoyable way possible.
For me, mobiles will help achieve this. They will act as an enabler to rejuvenate in-store shopping, and if implemented effectively, mobile technology will create truly interactive and enhanced shopping experiences. That sounds pretty enjoyable really, and it might just help save bricks and mortar retailing.
Malcolm Pinkerton is Senior Director and Senior e-Commerce Analyst, Planet Retail. He will be speaking on “MOVING YOUR E-COMMERCE OFFER FORWARD WITH THE CUSTOMER” at the Asia Fashion Summit, May 15, 2013, in Singapore.
This is an article contributed to Young Upstarts and published or republished here with permission. All rights of this work belong to the authors named in the article above.