Retailers Unsure How To Maximise Mobiles Potential

Retailers are increasingly seeing mobile as a business essential, but many remain unsure as to how to maximise its potential, according to the latest research from mobile marketing firm Sponge.

The second Mobile in Retail bi-annual report saw a big increase in perceived importance – the number of retailers stating that mobile was an essential part of extending brand or marketing activity doubled compared to the first wave of research last July, from 24 per cent to 48 per cent. Moreover, of the 78 retailers who took part, over 90 per cent said they now considered mobile as a very important or important direct sales channel.

Mobile internet is seen as the mobile must-have for retailers. 84 per cent agreed that making sure websites are optimised for mobile will be crucial for 2011. Location-based services and apps were next, with 69 per cent and 67 per cent respectively believing these will play a significant role in the multichannel shopping experience. Almost half of those surveyed (49 per cent) said mobile couponing was most important, while a third cited SMS.

Despite these findings, many retailers have yet to take action. While the number of respondents who have used mobile rose slightly from the last survey, 35 per cent have yet to leverage the channel in any form.

The latest research also saw a relatively modest increase in the number of retailers optimising their websites for mobile; up from 32 per cent to 40 per cent. Of the remaining 60 per cent, over 80 per cent said they plan to optimise their sites within the next 12 months, with the majority creating a site specifically designed to make best use of mobile, rather than simply ‘scraping’ their current website.

The proportion of retailers with apps has grown, from 32 per cent to 44 per cent. Compared to the widespread enthusiasm for the mobile internet, however, nearly half of those who don’t currently have an app have no plans to launch one.

“Part of the challenge retailers seem to be facing is developing and implementing fully coherent strategies,” says Phil Gault, client services director at Sponge. “Our second wave of research has found that only 42 per cent of retailers use mobile to drive traffic to their websites or stores. That’s a massive missed opportunity. Similarly, there’s been hardly any increase in the number using mobile as a call-to-action within their ads (37 per cent compared to 36 per cent). What’s encouraging is that, in addition to overwhelmingly positive customer feedback, over half (53 per cent) of retailers who use mobile are seeing evidence of sales from the channel. That’s a significant increase from 41 per cent six months ago. So proof that mobile adds value in both hard and soft ways is growing.”

Sponge’s research saw evidence that retailers who moved into the space early are now adding extra elements to their original offerings. Compared to the previous report, when asked about how they use mobile, product reviews were up from 19 per cent to 39 per cent; barcode scanning has grown from 15 per cent to 26 per cent; while allowing customers to compare prices with those of other retailers has more than tripled from 7 per cent to 23 per cent.

Those retailers with a mobile site or app (52 per cent) had also added more functionality. The number of retailers showcasing product ranges was up to 59 per cent from 46 per cent;  customer service solutions grew from 25 per cent to 41 per cent while those offering tools to help customers find stores or stock was up to 29 per cent, from 17 per cent last year. 47 per cent said they enabled mCommerce from their app or mobile sites. This was only 1 per cent higher than in July 2010.

While revenues coming direct from mobile remain relatively small – on average 1 – 2 per cent – the survey found that retailers who have embraced mobile are already seeing excellent returns. Positive feedback from customers has increased from 65 per cent to 82 per cent,  while 100 per cent of those with a mobile site or app said results had either met or exceeded their expectations (compared to 82 per cent previously). The Christmas and January sales period led to retailers seeing an increase in mobile activity. Of those who had reviewed the data, 85 per cent reported higher traffic, downloads or transactions.

Sponge’s survey also looked at the use of mobile in marketing and advertising campaigns. Retailers who used mobile as a call-to-action within their promotional activity now appear to be using it across more channels. The most popular medium was TV – 66 per cent of retailers that had used mobile as a direct response mechanism in advertising said they used shortcodes on TV spots. Print (60 per cent) and point-of-sale (53 per cent) came next.