Re­tail­ers have grown to like smart­phones

Ris­ing use of apps mak­ing tech­nol­ogy money-mak­ers rather than deal­break­ers

Calgary Herald - - FINANCIAL POST - ANNE D’IN­NO­CEN­ZIO

NEW YORK Just a few years ago, re­tail­ers con­sid­ered smart­phones the en­emy of the in-store ex­pe­ri­ence they were try­ing to cre­ate. Cus­tomers often whipped out their de­vice to com­pare prices on­line and then walked out of the store to buy the same prod­uct else­where.

To­day, stores are tak­ing their cues from shop­pers and now con­sider the smart­phone their friend. They’re giv­ing shop­pers more con­trol over the ex­pe­ri­ence with smart­phone app fea­tures that let cus­tomers do things like scan and pay, as well as down­load dig­i­tal maps — and repli­cate the on­line ex­pe­ri­ence.

Nike cre­ated a buzz last month when it un­veiled two new fea­tures on its mo­bile app dur­ing the open­ing of its lat­est high-tech store in New York City. One fea­ture lets shop­pers see de­tails of ev­ery item dis­played on a man­nequin by scan­ning the QR code next to it. Then with just a click, they can have the looks de­liv­ered to a fit­ting room or a des­ig­nated pickup spot with­out ever talk­ing to a store clerk.

An­other fea­ture, in­stant check­out, lets cus­tomers who’ve stored their credit card in­for­ma­tion on their phone scan the bar­code of an item, click the pur­chase but­ton, then walk right out of the store.

Shop­pers are in­creas­ingly us­ing their mo­bile de­vices to make pur­chases. That was ev­i­denced at the start of the hol­i­day shop­ping sea­son, when 33 per cent of on­line Black Fri­day sales in the U.S. were made on smart­phones com­pared with 29.1 per cent on Black Fri­day last year, says Adobe An­a­lyt­ics, which tracks on­line spend­ing.

“They ’re brows­ing, they ’re look­ing at con­tent, they’re get­ting re­views and they’re trans­act­ing,” said Jeff Gen­nette, CEO of Macy’s, who ex­pects the de­part­ment store chain to hit US$1 bil­lion in mo­bile sales for the first time by year-end.

But there’s still room for im­prove­ment. Stores need to do a bet­ter job of pro­mot­ing their mo­bile check­out while work­ing out some kinks. They also need to make their in-store Wi-Fi ser­vice more re­li­able, an­a­lysts say.

Here are three prob­lem ar­eas: Kinks in mo­bile check­out: Wal­mart, Tar­get and other large re­tail­ers have been send­ing work­ers through­out the busiest sec­tions of stores to check out cus­tomers with mo­bile de­vices. At Macy’s, shop­pers can scan and pay for items us­ing a new app fea­ture on their own smart­phones. From there, they must then go to a mo­bile check­out ex­press line or a reg­u­lar cash reg­is­ter and show the app to a worker, who will re­move se­cu­rity tags from cloth­ing. But there are lim­i­ta­tions. For stores like Wal­mart and Tar­get, shop­pers can only use mo­bile check­out for a lim­ited num­ber of items.

Spotty Wi-Fi: Stores’ Wi-Fi ser­vice had been good enough for shop­pers to tap into gen­eral in­for­ma­tion on their phones. But now it needs to be more re­li­able to han­dle all the dig­i­tal con­tent and ser­vices, ac­cord­ing to Neil Saun­ders, manag­ing di­rec­tor of Glob­al­Data Re­tail, a re­tail re­search firm. An­a­lysts say the con­nec­tions are still spotty and are not con­sis­tent within the store, and the ser­vice gets worse when the store is crowded. Un­re­li­able pickup ser­vice: Plenty of ma­jor re­tail­ers are of­fer­ing eas­ier ways for cus­tomers to pick up items or­dered on­line be­yond the ser­vice desk. And they ’re us­ing their smart­phones to get alerts on when to pick up their pur­chases. But an­a­lysts say there are still prob­lems of shop­pers walk­ing in and not get­ting the item they said would be ready.

An­thony Karabus, CEO of HRC Re­tail Ad­vi­sory, a con­sul­tancy, sur­veyed 30 top re­tail­ers and found the on­line pickup ser­vice wasn’t de­pend­able be­cause of a dis­con­nect be­tween the items the sys­tem tells shop­pers are in a spe­cific store ver­sus what is on hand.

RICHARD DREW/THE AS­SO­CI­ATED PRESS FILES

On­line Black Fri­day sales have spiked in the U.S., but an­a­lysts say there is still room for stores to im­prove the on­line shop­ping ex­pe­ri­ence, such as by mak­ing their in-store Wi-Fi ser­vice more re­li­able.

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