Mobile in-store trends to drive sales

How mobile is transforming the in-store experience

It's not surprising that more and more consumers are using mobile devices to locate and research products, compare prices, and make purchases. That is, unless you consider how many smartphone owners – a full 55 percent, according to a recent comScore/PayPal study – are doing so while shopping inside brick-and-mortar stores.

Such behavior ramps up already intense pressure on retailers, who once had the advantage of a somewhat captive in-store audience. Many consumers now divide their attention between evaluating products they can see and touch – and researching similar offerings from retailers online or across town.

But the news isn’t all bad. The mobile trend has given rise to in-store mobile marketing, which more brick-and-mortar retailers are exploring as a way to deepen customer loyalty, earn new business, and motivate increased purchasing. In many ways, mobile is taking on the role of "silent salesperson" – helping improve customers’ shopping experience by giving retailers the opportunity to deliver more personalized and higher-quality service.

Mobile as a convenient POS alternative

Providing convenient in-store mobile payments options is one way that brick-and-mortar retailers are using mobile to enhance the in-store shopping experience. Many now use mobile devices – particularly tablets – to increase convenience and reduce customer wait times. And more will soon follow: A 2012 Motorola report found 66 percent of retailers interested in using mobile POS services. Meanwhile, 42 percent – including major retailers– are either offering mobile POS programs or planning trials within the next 36 months.

In addition, some retailers are arming in-store salespeople with mobile devices, making it easier to locate an item in the shopper’s ideal color, size, style, and price – even if it’s not on the shelf. The goal: fewer thwarted shoppers and greater customer loyalty. Mobile devices also provide an opportunity for retailers to increase sale size through upselling and cross-selling.

The in-store mobile marketing trend may eventually cause retailers to change how they format and stock stores, predicts Veronica Katz, CSA Head of Retail Marketing and Strategy for eBay, Inc. "You can expect some retailers to improve inventory investments by lowering their inventory risk in stores, and showcasing an expanded assortment of products through mobile," explains Katz. "Apparel retail is one example of a vertical where you might see this approach take off."

Connecting in the right place, at the right time

According to PayPal Mobile Solutions Senior Manager Stephen Strauss, “You’re definitely going to see much more POS and in-store activity with mobile over the next few years.” Strauss points to smartphone-scannable quick-response (QR) codes as an example of how mobile is already deepening the shopping experience right in the aisle. The “silent salesperson” strikes again.

Retailers use QR codes to give shoppers product information – and to offer deals designed to spur purchases or drive shoppers to the retailer’s website. Either way, the retailer gets the sale.

Mobile also helps retailers stay in touch with consumers through advertising that‘s highly customized – and often geo-targeted. Many already send offers to customers’ smartphones via SMS text messaging, directing them to web-based deals. Some retailers take this tactic a step further, driving traffic to brick-and-mortar stores with location-based mobile SMS messaging and banner ads.

According to Mobile Marketer, apparel retailer Victoria’s Secret is among the brands wooing mobile audiences with geo-targeted banner ads. And a high-end skincare brand has made a splash with its mobile marketing efforts, creating opt-in SMS campaigns that alert loyal customers to in-store deals such as free samples and exclusive discounts.

Another lens for consumers to view retailers

More than ever, retailers must deliver excellent service across all touch points – mobile, in-store, and online. And the immediacy of communication via social media channels, increasingly accessed through mobile devices, means that shoppers share their experiences in real time –often while still in the store.

“With mobile, the consumer is really controlling the shopping experience,” says Katz. “It puts such a focus on service, magnifying both good and bad in-store experiences. Every single thing can be seen at a microscopic level – and broadcast to the world.”

Want to know more? Contact your PayPal Account Executive or email us.