the hub magazine - digital decisions

I realized how digital technology could change the way we shop after my second daughter was born. It was the Winter of 2004 and my wife sent me to buy newborn diapers. Our first daughter had been in toddler diapers for a while so I had forgotten what to look for in the store. All I had to go by was a piece of paper with the words milk, eggs … and diapers written on it.

I got to the baby section at my local supermarket and panicked. Everything had changed: the colors, the brand clues, the plan-o-gram … everything. I couldn’t call home because the baby was sleeping. Then it hit me. I could snap a photo of the diapers I thought were the right ones and text it to my wife.

This was kind of new to me at the time but we had both just gotten new phones so I figured I’d give it a try. I snapped the photo, sent it off and continued to shop. Ten minutes later, I got a response back from my wife. “Yes! Those are the ones. Hurry home!” That’s the day that the power of digital technology in retail marketing became real for me.

In the intervening years, countless new platforms have been created to reach the shopper at home, away from home, on the phone, and in the store. As was the case with newspaper, radio and television, advertisers see great opportunities to reach target audiences with these new vehicles.

It’s very tempting to dive in at the deep end with technologies that are getting the most buzz in marketing circles. However, to build a sustainable program that will actually engage shoppers, marketers need to sort through which tools work for their target shoppers, their business model and the specific retail environment in which they operate.

In August of 2010, we fielded an extensive study among 5,161 shoppers to understand how they use digital shopper technologies. We probed respondents on a variety of topics, including frequency of usage in 12 categories of digital tools; usage by channel and product category; influence on shopping behavior; barriers to usage; future intent to use the technology; demographics and psychographics; and digital behaviors and attitudes.

On the surface, we confirmed what most marketers already know: Well-established pre-store technologies that have been in the market longest have the highest level of penetration, followed by in-store technologies. Mobile tools are also gaining ground as smart phones are becoming more widespread and applications offer greater utility. (see chart one)

However, a deeper dive into that data showed that user adoption is only part of the story, and doesn’t necessarily correlate with what most marketers care about: shopper trial and purchase. We’re all in this business to sell more stuff. The key question for marketers is: Which digital tools will move the needle on spending and brand trial? (see chart two)

While still in the early stages of development, mobile is clearly the wave of the future for both brand marketers and retailers. Mobile apps, coupons and text messages all drive spending to the greatest degree. Brand websites, which help to make the shopping experience easier, also show a significant impact on spending. The results of our study also clearly showed that any technology at retail must deliver on three universal shopper needs:

1. Save Me Time. Even though their penetration at retail is fairly new, shoppers see a strong benefit from mobile tools in terms of time savings. Mobile apps, coupons and text messages appealed to more than 60 percent of users. In fact, a recent Accenture study found that 70 percent of people surveyed prefer using their mobile phone versus consulting with store personnel to conduct “simple tasks,” like finding product information and availability.

2. Save Me Money. Coupons delivered digitally via online or mobile and loaded on a loyalty card all deliver against the need to save money. However, shoppers credit other tools with saving them money, even when the technology does not deliver a coupon or savings.

Established technologies like store emails and interactive, in-store kiosks score high. Emerging technologies such as mobile apps, text messages and social media also register high. Even pure information sources such as store/brand websites and product reviews are viewed as money-saving tools.

3. Make Shopping Easier for Me. Convenience, time savings and an uncomplicated user interface are all ways to measure “making shopping easy.” Online shopping, loading coupons to a shopper card, and in-store recipe solutions all deliver on the shopper’s need for an easy experience. But with many new digital technologies, the adage “just because you can, doesn’t mean you should” needs to be taken to heart.

We look at several potential digital retail technologies every week and put ourselves in the shopper’s shoes as part of the evaluation. While many are easy to use and can make the shopping process easier and more rewarding, several require too many steps or are too cumbersome to use in the retail environment. As shoppers move up the learning curve with retail technologies, we believe that the “ease of use” hurdle will go away with many of these new tools.

Additionally, demographic differences play an important role in digital adoption at retail. As a simple illustration of this point, we cut our study data in high-level demographic segments. Females 35-54 place much more emphasis on online coupons, store emails, social media and store websites than the typical young, male shopper. Conversely, males 25-34 are more engaged with their mobile devices through mobile coupons, text message and mobile apps. They also pay more attention to other in-store technologies like interactive kiosks and display screens, as well as product reviews.(see chart three)

The world has changed a lot since that day in 2004. My daughter is seven years old now. She’s got an iPod Touch with about 50 apps loaded onto it. Many of them are “shopping” related. Now, she emails me while I’m in the store to add the things she wants to the shopping list. And, if I don’t respond immediately, I’m sure to get a “Facetime” call from her.

How important will technology be to her generation when they’re out shopping for themselves? We may not know now. But one thing’s for certain ... when it’s time, we’ll ask them.



	MARCH / APRIL 2011


	Digital Decisions

	*The hottest digital tools don't always sell more stuff.*

	I realized how digital technology could change the way we shop after my second daughter was born. It was the Winter of 2004 and my wife sent me to buy newborn diapers. Our first daughter had been in toddler diapers for a while so I had forgotten what to look for in the store. All I had to go by was a piece of paper with the words milk, eggs … and diapers written on it. I got to the baby section at my local supermarket and panicked. Everything had changed: the colors, the brand clues, the plan-o-gram … everything. I couldn’t call home because the baby was sleeping. Then it hit me. I could snap a photo of the diapers I thought were the right ones and text it to my wife. This was kind of new to me at the time but we had both just gotten new phones so I figured I’d give it a try. I snapped the photo, sent it off and continued to shop. Ten minutes later, I got a response back from my wife. “Yes! Those are the ones. Hurry home!” That’s the day that the power of digital technology in retail marketing became real for me. In the intervening years, countless new platforms have been created to reach the shopper at home, away from home, on the phone, and in the store. As was the case with newspaper, radio and television, advertisers see great opportunities to reach target audiences with these new vehicles. It’s very tempting to dive in at the deep end with technologies that are getting the most buzz in marketing circles. However, to build a sustainable program that will actually engage shoppers, marketers need to sort through which tools work for their target shoppers, their business model and the specific retail environment in which they operate. In August of 2010, we fielded an extensive study among 5,161 shoppers to understand how they use digital shopper technologies. We probed respondents on a variety of topics, including frequency of usage in 12 categories of digital tools; usage by channel and product category; influence on shopping behavior; barriers to usage; future intent to use the technology; demographics and psychographics; and digital behaviors and attitudes. On the surface, we confirmed what most marketers already know: Well-established pre-store technologies that have been in the market longest have the highest level of penetration, followed by in-store technologies. Mobile tools are also gaining ground as smart phones are becoming more widespread and applications offer greater utility. (see chart one) However, a deeper dive into that data showed that user adoption is only part of the story, and doesn’t necessarily correlate with what most marketers care about: shopper trial and purchase. We’re all in this business to sell more stuff. The key question for marketers is: Which digital tools will move the needle on spending and brand trial? (see chart two) While still in the early stages of development, mobile is clearly the wave of the future for both brand marketers and retailers. Mobile apps, coupons and text messages all drive spending to the greatest degree. Brand websites, which help to make the shopping experience easier, also show a significant impact on spending. The results of our study also clearly showed that any technology at retail must deliver on three universal shopper needs: 1. Save Me Time. Even though their penetration at retail is fairly new, shoppers see a strong benefit from mobile tools in terms of time savings. Mobile apps, coupons and text messages appealed to more than 60 percent of users. In fact, a recent Accenture study found that 70 percent of people surveyed prefer using their mobile phone versus consulting with store personnel to conduct “simple tasks,” like finding product information and availability. 2. Save Me Money. Coupons delivered digitally via online or mobile and loaded on a loyalty card all deliver against the need to save money. However, shoppers credit other tools with saving them money, even when the technology does not deliver a coupon or savings. Established technologies like store emails and interactive, in-store kiosks score high. Emerging technologies such as mobile apps, text messages and social media also register high. Even pure information sources such as store/brand websites and product reviews are viewed as money-saving tools. 3. Make Shopping Easier for Me. Convenience, time savings and an uncomplicated user interface are all ways to measure “making shopping easy.” Online shopping, loading coupons to a shopper card, and in-store recipe solutions all deliver on the shopper’s need for an easy experience. But with many new digital technologies, the adage “just because you can, doesn’t mean you should” needs to be taken to heart. We look at several potential digital retail technologies every week and put ourselves in the shopper’s shoes as part of the evaluation. While many are easy to use and can make the shopping process easier and more rewarding, several require too many steps or are too cumbersome to use in the retail environment. As shoppers move up the learning curve with retail technologies, we believe that the “ease of use” hurdle will go away with many of these new tools. Additionally, demographic differences play an important role in digital adoption at retail. As a simple illustration of this point, we cut our study data in high-level demographic segments. Females 35-54 place much more emphasis on online coupons, store emails, social media and store websites than the typical young, male shopper. Conversely, males 25-34 are more engaged with their mobile devices through mobile coupons, text message and mobile apps. They also pay more attention to other in-store technologies like interactive kiosks and display screens, as well as product reviews.(see chart three) The world has changed a lot since that day in 2004. My daughter is seven years old now. She’s got an iPod Touch with about 50 apps loaded onto it. Many of them are “shopping” related. Now, she emails me while I’m in the store to add the things she wants to the shopping list. And, if I don’t respond immediately, I’m sure to get a “Facetime” call from her. How important will technology be to her generation when they’re out shopping for themselves? We may not know now. But one thing’s for certain ... when it’s time, we’ll ask them.


	RON MAGLIOCCO is svp of shopper marketing at Ryan Partnership, He has spent his 20-year career in retail marketing roles in cluding data analytics, client-side brand and customer management.

	PDF \| Subscribe \| Home