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In January 2012 the CEO of Target, Gregg Steinhafel sent a letter to key suppliers bemoaning online competition and asking them to help solve the problem. His primary concern, and that of other retailers is that brick-n-mortar stores are becoming showrooms for e-tailers who offer the same products at lower prices.  Research supports this notion and suggests that it’s a growing problem.  A recent study by the Pew Research Center found that of a group of shoppers who used their smartphone in-store during the 2011 holidays:

-       37% decided not to purchase

-       35% purchased the product in that store

-       19% purchased the product online

-       8% purchased the product at another store

In the past the retail industry operated off the assumption (fueled by a POPAI study conducted in 1995) that 70+% of purchase decisions happen at the instant and place of product availability. This was a boon for point-of-purchase (POP) marketing collateral and by 2002; the POP market had become a $17.6 billion industry.

Fast forward a few years and it is now estimated that nearly 100 million Americans own smartphones. A large percentage of them are using them in-store – not only to check prices, but also to get detailed specifications, shop comparable products, and read customer reviews.  In fact, online retailers like Amazon are encouraging this behavior.  Late last year they offered consumers 5% off purchases (up to $5) if they used Amazon’s price check app while shopping in a physical store.  One would think brick-n-mortar retailers would be highly motivated to direct consumers to their own websites for this information.

eCommerce cannot be overlooked. It was responsible for $161.5 billion in 2011 sales and grew by 13% vs. 2010.

Since smartphones are capable of scanning 2D (QR) barcodes, it would seem natural that these would be everywhere in retail stores by now. Roughly 50% of smartphone owners have scanned a QR code and of those that have, nearly 20% made a purchase. They’re one of the easiest ways to connect physical items with information online. Yet amazingly enough, a December 2011 study of over 700 retail locations by Nellymoser found that only 7.2% of the stores were using them as part of a mobile marketing strategy.

Clearly this technology trend is an opportunity for retailers and CPG companies to connect with consumers like never before.  It also creates a benefit for brick-n-mortar, as consumers still want to touch, feel, and experience products before making a purchase.  Given its propensity to influence, POP seems the most natural place to make a connection between a product and a website.  Retailers own their space and should ensure that interactive POP builds the bridge between their web assets and products on their shelves.

At IM Interactive, we’re focused on leveraging tomorrow’s technology, today. We’re working with retailers and CPG clients to blend the best of e-commerce and mobile technology with traditional, in-store marketing. We’re building new solutions that allow retailers to connect with consumers like never before. These tools are helping retailers build market share, foster loyalty, and discourage competition. If you’re interested in hearing more, CONTACT US TODAY. We’ll begin by consulting with your team to provide solutions that get results.