The following article is Part I of a two-part series covering Analyzing The Mobile Consumer: Shifting Behaviors And Preferences Create Opportunities For Innovative Retailers. Part II will appear in the February 28 Newsletter.

The smartphone’s increasing affordability and accessibility make it a must-have tool for consumers across age segments and geographic locations. On Christmas Day alone, 6.8 million smartphone devices were activated, a 140% increase from 2010, according to findings from Flurry Analytics.

The 2011 holiday shopping season also emphasized the growing prevalence of mobile commerce. In September 2011, PayPal predicted that nearly half (46%) of consumers planned to make a holiday purchase on a mobile device. PayPal analysts said that with growth of “couch commerce,” retailers promoting and encouraging mobile purchases were poised for success. Results from IBM indicated that during December 2011, 14.6% of all online sessions occurred on a mobile device, a 7.5% boost over 2010. Mobile purchase rates also increased from 5.5% in December 2010 to 11% in 2011.

With the continued rise of smartphones, most retailers are looking for ways to open and realize the full potential of the mobile channel to increase customer engagement, convenience, and loyalty. With some thought, mobile can also aid in customer acquisition and revenue generation.

A mobile app is one of the best mobile tools available to reach shoppers and can provide a more captivating and convenient user experience than other mobile vehicles like SMS, mobile web or QR codes. But mobile apps need a good engagement strategy to keep them relevant. Every retailer or brand should aim to create a mobile app strategy that encourages the consumer to engage on a regular basis. Depending on the business model, a successful mobile engagement strategy should have 30% or more of customers interacting or transacting with the brand on a weekly basis.

Shoppers natively are impulse consumers. They buy in what retailers call, “5 by 5” (five seconds by five feet).  At home they may write out lengthy shopping lists and do hours of research on products, but in the store, 80% of their baskets are full of products bought on pure impulse.

The phone has become a shopping aid that can help shoppers be more effective impulse buyers. The retailer that manages to engage effectively with this new shopper will win. This is the industry challenge.

I have always said that the phone in the shopper’s pocket is more powerful than the computer that sent the first person to the moon. But yesterday I was doing some water cooler math with my IT director: We worked out th at the Apollo Guidance Computer had 2kb of memory, 32kb of read-only memory (storage), and a CPU with 1.024 MHz. The new Samsung Galaxy II S smartphone has 1GB of memory (1 048 576 kb), 32GB of storage (33 554 423 kb), and a CPU Dual-core 1.2 GHz (1200 MHz x 2).

For many retailers, in-store success hinges on the efficiency of checkout systems — both self-checkout and the traditional POS. Merchants can prevent unsavory customer relationship issues by having visibility into potential system problems ahead of time.

NCR Predictive Services is a managed service offering for assisted and self-service technologies. The solution is aimed at predicting failures before they happen, to help retailers enhance preventative measures and speed issue resolution. Already available for self-checkout devices, in January 2012 NCR expanded the capabilities of its Predictive Services to the NCR RealPOS™point-of-sale (POS) terminals.

As the U.S. unemployment rate continues to decline, consumers are less concerned with the job market compared to 30 days ago, and less inclined to curtail spending, according to a Monthly Consumer Survey from BIGinsight. The report showed that, compared to February 2011, consumers have a more positive outlook on their savings habits without decreasing the number of store visits.

Walmart Wins Consumers’ Hearts

With the decline in unemployment rates comes an increasing interest in shopping, and consumers were not afraid to spend at their preferred retailers in early February 2012. The BIGinsight report indicated retailers such as JCPenney, Kohl’s, Macy’s, Target and Walmart were the top stores consumers visited for women’s, men’s and children’s clothing. Of the retailers listed, Walmart received consumer approval in grocery, health and beauty, footwear, as well as men and children’s apparel.