Retailer Features / Trend Features / Omnichannel

Special Report: Technology

September 16, 2011
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Techie types have been hyping the changes that mobile phones would bring to retailing for at least the past decade. Now, thanks to the growing ubiquity of smart phones with Web capabilities, that hype is becoming reality.

Indeed, the Deloitte 2011 Consumer Food and Products Insights study, released in July, found that 40 percent of U.S. consumers are using shopping lists and recipe management tools on their mobile phones today.

Private label retailers are beginning to join the movement to capitalize on mobile commerce mania with mobile applications.

A quick scan of the Apple apps store, for example, shows 17 North American private label retailers offering mobile phone apps that do everything from sending customers weekly specials to helping them build shopping lists to offering them recipes.

At least one retailer, Stop & Shop, has gone even further, offering a mobile app that lets people shop in-store using their phones. Others, such as Big Y, have experimented with offering deals through the social buying site Groupon.

And a new type of bar code, known as mobile tags, mobi tags, Microsoft tags and QR (for quick read) codes, are turning phones into shopper gateways to gather more information than they ever have had at their fingertips about the products they want to buy.

If your organization hasn’t joined the mobile march as yet, don’t worry, it’s certainly not too late. Don’t feel you need to rush in either. Before using mobile apps or other new technologies out there, talk to customers about what they want and how they use technology. Then decide which efforts will help you build customer loyalty and sell more private label offerings.

“Today it’s mobile, yesterday it was kiosks; you have to make sure [the latest technology] fits who you are and not just do it because it’s today’s technology,” counsels Harry Kimball, director of database marketing with Springfield, Mass.-based Big Y. “If the customers have interest in mobile apps or you think it would help their shopping experience to do those things,” look into it, he says. But “don’t just do it to beat your chest. We try to pick our spots and try to be consistent with what we’re trying to accomplish here.”

“When you download an application onto your phone, [you] are much more loyal, much more committed” to the retailer supplying the app, explains Rebecca Roose, product marketing manager with MyWebGrocer, a Colchester, Vt.-based company that has developed mobile apps for retailers such as Winn-Dixie, Brookshire’s, Shop Rite, Roche Bros., Marsh and Raley’s. Once consumers are using your app to build a weekly shopping list, “they’re not going to go somewhere else,” she says.

A mobile app can be customized to feature private label products in weekly specials, to suggest them in recipes or to transfer coupons for private label offerings to loyalty cards. The app can be tied to a desktop computer as well so consumers can easily transfer coupons and lists from one to another as needed, Roose explains.

Creating a mobile app begins by deciding which mobile platforms to create it for. Retailers can analyze traffic to their mobile Web sites to see what types of phones consumers are using to access them and then decide which mobile phones to write their apps for, Roose explains.

With Apple’s iPhone and smart phones running Google’s Android operating system dominating the smart phone world today, creating apps for those two will likely cover the vast majority of your customers, she says. Traffic from those two types of devices can represent 95 percent of the average retailer’s Web traffic, she explains.

After picking the platforms, decide which features in an app will appeal to your shoppers. Do they want your weekly ad circular in digital form, recipes, list building functionality, coupons? “You can’t have everything on a mobile phone that you have on a full Web site,” Roose advises. A mobile app can be up and running in less than two months.

Salisbury, N.C.-based Food Lion, owned by Delhaize, rolled out its mobile app in December 2010 “as an additional way for our customers to access weekly specials, new recipes and store directions right at their fingertips,” Food Lion spokesperson Benny Smith tells PLBuyer. Its app is available for iPhone, iPads and iPods. Smith could not comment on if it will be offered for other mobile phones.

Private label products are featured in a weekly specials tab within the app, Smith explains. More than 13,000 people downloaded the app from its December introduction through July, Smith says.

“Food Lion customers are reacting generally positive to the new app…due to competitive reasons, we do not share sales numbers, but we can say that the app, combined with our other marketing strategies, all have positively influenced us disseminating the message about our excellent store brands,” Smith says.

Quincy, Mass.-based Stop & Shop Supermarket Company LLC in July began testing Scan It! Mobile, developed by mobile marketing company Modiv Media of Quincy, Mass. Scan It! is a mobile app that enables shoppers to scan product bar codes with their phones as they shop and then use the phone to checkout. A customer walking into one of the three stores where Stop & Shop is testing the new app also can view an offer wallet of specials on their phones based on previous shopping behavior garnered from loyalty card data, explains John Caron, senior vice president, marketing with Modiv.

“For the retailer, they can push anything they want” in offers, including private label products, he notes.
Stop & Shop also has used handheld scanners supplied by Modiv to automate shopping, notes Suzi Robinson, manager, public and community relations, with the Ahold-owned banner.

“For us, we want to be where our customers are at, what’s convenient for them,” says Robinson about why Stop & Shop is in the mobile world. “We feel it really is necessary because it’s what customers want.”

While Stop & Shop’s app works by scanning existing bar codes on products, a new type of packaging code can allow retailers to supply shoppers with more information about their products than they ever have before. QR codes essentially are gateways to mobile Web sites that can talk in detail about a product, explains George Hoffman, president of Charlotte, N.C.-based ClikGenie Inc., a mobile marketing company. A shopper can download a QR code reader to his or her phone for free. The reader can then be used to scan codes on products, in ads or on in-store signage. Scanning the code sends the phone to a Web site. Some codes will send people directly to your Web site, others route them through whoever created the code for you, such as Google. Direct codes give you more information about customers and are preferred, experts say.

“It’s a way of taking a static box and turning it into interactive packaging and I think that’s really what the future is all about,” says Andrew Rawson, president of Superior Lithographics, a Los Angeles-based packaging printer. “You’re going to buy from the guy who helps you understand your choices because that’s when you’re comfortable.” Rawson’s company can build you a site that a code leads a shopper to for roughly $20,000, he says. It calls its system FirstTouch. The price includes monthly reports analyzing traffic to the site.

Rick Blair, CIO of Opinion Lab, a Highland Park, Ill.-based company that gathers consumer feedback, envisions retailers using QR codes on store signage to tell shoppers about daily specials in the specific store they’re in. “By providing your customer with the information they need when they need it, we know for a fact that’s building on the relationship for your brand,” he says.

When Duane Reade opened its new flagship store July 5 at 40 Wall Street in Manhattan’s financial district, it went beyond codes in its attempt to get consumers to connect with its brand. It installed a Tensator virtual assistant, a projection of a person who talks to customers in the store.

The current version speaks pre-recorded scripts but future versions being developed will allow for interactivity, says Keith Carpenter, senior business development manager-retail with Lawrence, the Bay Shore, N.Y.-based arm of U.K.-based Tensator Group which developed the virtual assistant. A version 2.0 with interactivity is expected to be available by late this year. With it, retailers can answer consumer questions about their private label products or feature specials for them, Carpenter notes. Of version one at Duane Reade, Carpenter says, “people do engage, people do stop.”

Getting people to engage with your private label, whether through mobile apps, codes or virtual sales help, is what today’s latest techie tools are all about. It’s up to you to decide which will get your customers’ attention and help keep them loyal to your private labels.

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