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The proliferation of mobile and smartphone technologies has provided retailers with a unique opportunity to connect with customers. However, a recent survey by Retrevo found that 43% of smartphone shoppers have downloaded a retailer’s app, but only 14% of customers actually use it to help them purchase an item. Many retailers are losing mobile market share to tech retail giant, Amazon.com. Amazon.com has an app that allows customers to scan an item from any retail location and purchase it directly from Amazon.com via their smartphone.
Research indicates that most retailer apps are less successful because they don’t actually “do” anything that adds value for the customer. New technologies are available that retailers can develop to completely transform the traditional shopping experience, add value for customers, and level the playing field with companies like Amazon.com. These new technologies include:
1. Previsualizing your purchase – If a customer wants to purchase a couch, they can take a picture of the room where the couch would be placed. The picture of the room is then saved to an app that knows the furniture inventory of the retail store where the customer will shop. Once the customer picks out a couch that is the right size, shape, and fabric, the customer can swipe the phone over a sensor and an image of the couch will be uploaded to the picture of the customer’s room. This allows the customer to visualize how the couch will look in the living room.
2. The personal touch- via cell phone- When customers walk into a store, they can automatically check-in through the retailer’s app. Retailers can offer rewards points for checking-in that can be used towards later purchases. The apps can also use social trends, web trends, input from your friends and social circles, to guide you to the products in the store that best fit your needs.
3. Shelf tags that talk back- Retailers can use smart-lamp technology to communicate with customers without using a mobile app. This product senses when a customer picks up an item off a shelf. The smart-lamp technology then projects images and interactive video onto the shelf giving the customer more information about the product and its uses. Retailers can also use projection technology to guide shoppers through the store to specific items and departments.
4. No more checkout lines- Gone are the days of traditional tender types like credit cards, cash or check. Now, with technologies like Google Wallet, customers can swipe their phones over payment sensors. Eventually retailers can use mobile payment options to eliminate all queues; customers can gather products that they want and pay for them with a single swipe from a mobile device anywhere within the store.
Discussion Questions:
1. Are customers using retailer-provided apps?
2. What could retailers be doing with smartphones and other technologies to stimulate sales?
Vipin Jain, “Reimagining Retail,” What Matters (McKinsey & Company), October 26, 2011.
Grewal Levy Marketing News 
It’s hard to accurately answer whether customers are “using” retailer-provided apps, because they are often downloaded, opened once or twice, maybe even by accident if a smart phone user accidentally clicks the app, and then forgotten. So while perhaps retailers feel that having an app available is good enough, it will not necessarily encourage customers to visit stores. The feeling is probably that there is no reward — whether tangible or electronically displayed — for the customer for having the app.
Retailers would be much more successful if they honed in on the customer’s desire for instant gratification. In other words, smart phone users will keep using an app that makes them “feel good” about themselves. This could be either through coupon rewards or exclusive sale benefits for users, in a flashy and exciting way on the smart phone. This would be even more effective if the rewards were cumulative. For example, Starbucks’ app has a gold cup that fills up with stars every time the customer makes a purchase. This creates the feeling of instant gratification, because the smartphone sparkles and the customer has received a virtual reward. It also creates cumulative satisfaction, because after the customer receives a certain amount of stars, he can redeem them for a free drink.
Personally, I download many apps onto my phones from retailers. That being said, I delete many of them because just like the article says, they do not provide any value to me. There are two things I am often looking for when I download an app of a business I really like. The first is whether or not that company will be sending me coupons to entice me to buy more from there. The other is that I want to see if the company will send me updates about any new products being sold or any other important notifications the company may want to tell its customers. If retailers do not include these things with their apps then I do not see the statistics at the beginning of the article changing any time soon.