By Jeremy Spencer, Head of Propositions, EE
UK businesses could learn a lot from the country’s retail sector. Nowhere was the recession more evident than on Britain’s high streets, as numerous household name retail brands fell victim to the economic downturn. Now though, retailers have weathered the worst the economy has to offer, and are beginning to win back customers. According to the British Retail Consortium UK retail sales accelerated in August, with total retail sales 2.7% higher than a year ago. In part, sales are growing because retailers are appealing to a new breed of bargain-focused, technologically-capable consumers. They’re increasingly using an omni-channel approach to connect with their customers via technology, and using it to improve their shopping experience.
‘Omni-channel’ is a retail term that essentially refers to enabling customers to interact with a retailer and make purchases however they want to do so — in store, online, or on the move. Most retailers start by providing as many touch points as possible for the customer to connect with the brand. Amazon recently announced a partnership with Twitter, for example, that enables users to add products to their shopping carts by tweeting a special hashtag. By seeking to engage consumers across every channel, retailers allow consumers to interact with them on their own terms, while also equipping themselves to provide a better customer experience.
Rise of the connected consumer
Smartphone penetration is at an all-time high in the UK, currently at 71% according to data from Kantar Comtech, and as penetration of 4G mobile services steadily rises, shoppers increasingly rely on being connected. EE’s own 4G network covers more than 75% of the UK, and our research shows that 4G is encouraging more and more people than ever to use their mobile devices to shop. 53% of 4G users in the UK have used their mobile to pay for something in the past six months compared with just 34% of 3G mobile users, while over two thirds of 4G users have accessed the internet while out shopping compared with just half of those on 3G.
In addition, faster, more reliable mobile internet and public WiFi connections are giving retailers the opportunity to build closer relationships with their customers across multiple channels. For example, when customers connect to a retailer’s in-store WiFi and opt-in to receive communications from the retailer, the retailer can track how long those customers spend shopping and can send them personalised offers or promotions while they shop. This provides valuable insight for the retailer, and provides an immediate benefit for the customer.
Real-time data analytics enables retailers to send communications to customers while they are shopping or use heat mapping technology to anticipate queues at the checkout. They can even plan and update store design and layout to optimise traffic flow. All of this means retailers can deliver a better shopping experience that customers will value and keep coming back for.
1 million customers subscribe to Asda’s in-store Wifi
Asda’s introduction of a new branded WiFi service into its 585 UK stores instantly attracted over 100,000 customers, and the service now has more than 1,000,000 subscribers. Cross-referencing WiFi data with customers’ online shopping information provides a more complete view of their buying behaviour. This enables Asda to provide its customers with more targeted services and communications across online, mobile and in-store channels.
Asda also uses its in-store WiFi to let managers complete admin tasks from the shop floor using tablet devices, which has given them back seven hours a week to spend with customers and colleagues.
The threat of ‘show rooming’
A strong omni-channel strategy is now crucial for any retailer large or small. One of the key challenges all retailers are currently facing is ‘showrooming’, a trend that sees consumers use their mobiles to find the best price online while they’re out in physical shops. Over 20 million consumers (44%) already do this according to our own research. It’s a problem that isn’t going away, so retailers need to find ways to turn the ‘showrooming’ trend to their advantage.
But showrooming need not be a threat, as retailers can use this behaviour to their advantage. John Lewis has made showrooming work for them by offering customers a price promise in its TV department and by providing free WiFi in-store, helping customers to compare prices while in the shop. John Lewis believes it’s better to take a hit on its profit margin than lose the sale altogether.
The economic downturn meant austerity for many British consumers that is slow in going away. People aren’t going to stop looking for the best deals, particularly when technology is going to get better and better at helping them do this.
Businesses can learn from retailers’ examples by understanding the need to be able to interact with customers at any point during the buying process, from discovery to purchase, across any channel and any device. 4G and in-store WiFi together are providing part of the solution for Britain’s retailers, and, by recognising the landscape has irrevocably changed, retailers are realising they have tools, support and ability to rise to the omni-channel challenge.