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Industry Leaders Provide Insight Into Retail Success in a Mobile/Social World

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More than 120 retailers joined Google and other industry-leading companies to delve into the hottest topic in retail today: bringing the fourth channel – mobile – to life. In addition to a presentation by Wet Seal CIO Jon Kubo, participants at this week’s Oracle Crosstalk event heard from a panel of experts including executives from Google, Digby and Buzzient.

Wet Seal has been on the forefront of the mobile/social scene, tapping into the growing use of social media to create successful marketing programs. Approximately 72% of Wet Seal customers (ages 15-19) are on Facebook today, Kubo said, not to mention Twitter, YouTube and Myspace. And while a web-only social media marketing strategy may work today, the mobile channel is growing at such a rapid rate that retailers that don’t include mobile in the mix will be left behind.

Kubo noted that the adoption rate for mobile devices is unprecedented. While it took two years for 1 million iPods to be sold; it was a mere 74 days before 1 million iPhones were in consumers’ hands and only 28 days for 1 million iPads.

Wet Seal found initial success with its Fashion Community on the web, allowing wetseal.com visitors to design an outfit with Wet Seal fashions and post the outfit to the Wet Seal Runway for review by other users. In two years users created more than 500,000 outfits, generating 20% of the brand’s eCommerce revenue, noted Kubo. Wet Seal then tested the Fashion Community in stores via kiosks and in 2009 brought the Runway to iPhones and named it iRunway. Today “we have about 500,000 outfit views each week,” he said.

The secret sauce, Kubo explained, is the combination of social and mobile. Realizing that smartphones users’ number-one accessed application is Facebook, Wet Seal posted its iRunway to social site and has seen an increase in user-generated posts by tenfold. The company now has two applications on Facebook – iRunway and Shop with Friends, an application that allows users to shop “together” by viewing the same products either on their mobile phones or on the web. In the future Wet Seal is planning to integrate its brand into a social game.

Google, Digby and Buzzient Share Insights
Three leading industry executives shared insights with Oracle’s David Dorf, Director of Technology Strategy, at a panel discussion during the Crosstalk event.

At Google mobile shopping queries have increased 3,000% in the last 18 months, according to Sameer Samat, Product Director. As a result Google launched a click to call in ads and is providing data feeds to product reviews in its Universal Search. “We have found that users must have all channels working seamlessly together or they feel their overall experience with the brand is ‘broken,’” Samat noted.

Buzzient is a technology platform that collects, harvests and analyzes social media data. With this data in hand, for example, retailers can find out what products consumers are talking about and use that information to improve merchandising choices, noted Tim Jones, Founder & CEO.

Founded in 2006, Digby is a software developer helping to build out the mobile channel for retailers. “Our extensive software platform enables mobile web and on-device apps for customer-facing use cases,” explained Dave Sikora, CEO. Sikora recommends that at a minimum, retailers should implement mobile web applications.

Also during the Oracle event, Intuit announced the launch of QuickReceipts which are digital receipts shoppers can receive instantaneously on their mobile phones upon making a purchase. The product will be available initially at Home Depot and Best Buy beginning in the summer of 2010.

Taking the Mobile Lead from NRF
If retailers are still unsure about whether or not to join the mobile revolution, they can look to the National Retail Federation (NRF). The NRF has established a Mobile Retail Initiative and is preparing to release a comprehensive whitepaper/guide to Mobile Retailing for retailers.

Working together with retailers, vendors and standards organizations, the NRF compiled the paper as a reference to help retailers understand what is possible using mobile phones. Clearly, NRF believes mobile adoption and use is reaching widespread levels in the near future. “Mobile is not only considered the fourth channel, it tends to be an enabler for the other three channels as well,” the paper notes.

NRF recommends that retailers look at three different levels of mobile retailing: two on the consumer side and one at the store associate level. “Consumer mobile applications can be subdivided into those that influence buying decisions (marketing), and those that enable purchases (commerce),” the paper explains. For store associates, mobile applications can help with store operations functions including product research, in-stock positions, warehouse management, POS, price verification.

The paper also points out “an important trend” in mobile retailing: the support for HTML5 and WebKit technologies currently emerging in mobile browsers. “This support enables mobile web site developers to provide a rich ‘app-like’ user experience on mobile Web sites,” NRF explains. “The technology is currently available on the Apple iPhone operating system (OS), Google Android OS, and Palm WebOS devices, as well as in new RIM BlackBerry devices and other smartphones. This technology will allow retailers to create mobile shopping sites that take full advantage of smartphone capabilities without being tied to a specific mobile operating system.”

Additionally, the NRF paper addresses the issue of supporting “a multitude of mobile OS platforms, screen sizes, input capabilities, and customers who do not have a data plan” as a “major challenge of mobile retail.” To address this issue, retailers could consider a client-server architecture that relies on the phone as the client, says NRF. “In this so-called thin client architecture, a server would have the intelligence on the workflow required for the particular service (i.e. the first screen shows a catalog, the second screen product detail, the third screen payment options), and the client (the phone) needs only display-related capabilities and input handlers.”