Analysis

How To Prepare for Smartphone and Tablet Shopping This Festive Season

Consumers are reporting that Christmas and holiday spending will be up for this year’s festive season.  While this is great news for retailers, traditional selling techniques are losing their effectiveness. Consumer shopping habits and expectations are changing.  In Deloitte’s recent survey of holiday shopping venues, the Internet topped the list for the second year running.  Online retail traffic is booming in Australia and a whopping 38% of it comes from mobile devices.  With tablets emerging as a preferred channel for online shopping, it’s important to be aware of all the screens in your customers’ hands this holiday season.

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According to Deloitte’s annual Holiday Shopping survey almost 50% of customers intend to shop on the Internet this holiday season.   And it’s not just online commerce sites that have an impact.  As much as 50% of physical in-store sales are influenced by digital interactions.  Digital technology is having an unprecedented impact on shopper behaviour in-store, online and via mobile devices. According to Deloitte, while many customers still prefer traditional retail outlets, in some categories as many as 40 – 50% of customers have no preference and would happily shop either online or in-store.  Often it’s a matter of convenience that tips the scales, along with knowledgeable sales staff and short queues.  Even before spending a cent, 68% of customers are likely to research a product online before buying it, and almost half are likely to participate in showrooming this holiday season.  According to the survey 49% of customers reported that they are very or somewhat likely to go to a store to look at an item, and then follow up by actually purchasing it on the internet.

During last year’s holiday period, 52% of online smartphone shoppers used their phones throughout the shopping process.  On average consumers spend more than 15 hours researching on mobile sites and apps. Deloitte’s showrooming data is supported by UK Mobile Commerce firm Weve.  Weve surveyed British customers in the lead up to Christmas last year and found that 64% had used a smartphone to compare prices while in store.  Weve’s 2013 research also found that 88% of smartphone owners use their mobile as part of their Christmas Shopping.  Around half actually made a purchase using their smartphone while 70% used the device to search for gift ideas.

While the Weve and Deloitte surveys focus on O/S markets, we can expect similar trends locally with all signs pointing to an optimistic outlook for consumers and retailers this year.  NRA CEO Trevor Evans said retail performance results were setting the scene for the summer months and the lead up to Christmas, making retailers hopeful they’ll have a much-needed strong finish to 2014.  This is backed by consumer confidence reports which have bounced back since earlier in the year. The ANZ/Roy Morgan Consumer Confidence four-week average is now up to its highest level since late April. ANZ Chief economist Warren Hogan indicated there is good momentum to retail sales as we head into the Christmas spending season.

According to Bosco Tan from Pocketbook, Australians spend 123% of their income (ie. more than they earn) in December, so the opportunity to capitalise on this boom period is huge. While its always been a bumper time of year for retail, smartphones and tablets are becoming increasingly relevant to the Christmas shopping rush.  More than a third (38.4%) of the online traffic during November and December 2013 came from mobile devices, up 44% on the previous year. The IBM Annual Australia Online Retail Holiday Readiness Report noted that Australia’s 24 hour Click Frenzy in late November was the biggest shopping day of the year, closely followed by Boxing Day.  Throughout the November/December season, Australian online sales were up 33.8% YOY.

It’s not all good news however,  Australian retailers are well behind the U.S. and the U.K in important metrics like conversion and average time on site.  There is no doubt we could be making more of the local enthusiasm for online shopping.  This may have something to do with the disparity in investment in marketing technologies to drive site traffic.  With marketers in the U.S. spending as much as 28% of their marketing budget driving traffic, Australian brands have some work to do to lift spend from the 19% where it currently stands.   With an Australian Average Order Value from smartphones at a surprisingly high $134.27 it’s an investment worth making.

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Many retailers feel Australia lags behind the US in the size of opportunity for mobile retail, but the reality is that we are  comparable to our US neighbours in both retail traffic from mobile devices and percentage of sales.  With both nations receiving a whopping 38% of retail traffic from mobile devices, it’s clear the customers are there on both sides of the pond.  And surprisingly, Australia pips the U.S. at the post with 19.8% of sales coming from mobile devices versus 16.6% in the US.   We all lag some way behind the UK which sees almost 50% of retail traffic coming from mobile devices and a huge 35.8% of sales made via mobile.  It won’t be long before we see local mobile traffic edging up beyond 50% as well, and brands who leap in now will be best prepared.

It’s not just transactions and commerce that retailers need to be prepared for. Deloitte found that shoppers will increase their overall use of digital, mobile and social technologies throughout this holiday season.  Digital technology is influencing transactions via multiple touch points throughout the sales cycle. Shoppers will use their smartphones to discover gift ideas, share their shopping plans and experiences via social media, read product reviews, carry out in-store price comparisons, search for local merchants and obtain directions.  Many of these services and tools are available via mobile websites, but an increasing number will be using apps to share, research, compare prices and find deals.

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Deloitte found that 46% of surveyed shoppers will use their smartphone to support their holiday shopping experience and 72% will use social media to find gift ideas, reviews and deals.  As many as 23% plan to use their smartphone to carry out in-store price comparison which should be a wake up call to retailers who haven’t developed a mobile response to the showrooming phenomenon.

For Australian marketers, one of the biggest opportunities in the 2014 Christmas period is in generating leads and sales from Tablet devices.  While Australian retail sites see around the same amount of traffic from mobile and tablet devices, more than 76% of sales come from tablets versus only 23% from smartphones.  Tablets are clearly the preferred shopping device for Australian customers.

Mobile Sales by device type


How To Prepare For Smartphones and Tablets This Festive Season

1. Ensure product catalogues and information are accessible from multiple devices.

2. Make it easy to research your products online, from any device.

3. Support your customers to use their smartphone and tablet to discover your products when researching gift ideas.

4. Review your online shopping experience from smartphone and tablet devices.

5. Direct in-store customers to your digital content. Make sure they can find your products when they pull out their smartphone.

6. Be prepared for Boxing Day online sales via smartphones and tablets.

7. Invest in marketing strategies to drive traffic to online and mobile content for holiday season activities and shopping.

8. Calculate the ROI on generating more smartphone and tablet traffic.

9 .Make it easy for shoppers to share information about your products on social media, via mobile devices.

10. Make sure your retail locations are discoverable using mobile mapping services like Google and Apple Maps.

11. Review digital content and shopping services for tablets and ensure the shopping experience is optimised for these devices.


 

 

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