With competition increasingly fierce, digital is more crucial than ever to reach, attract and retain increasingly demanding, time-pressed customers. The use of smartphones and mobile technologies (Bluetooth, WiFi, NFC, ultrasound, etc.) are the main components of digitalised points of sales. Because consumers are no longer content with just consulting their phone before making a purchase: the mobile phone has become an essential in-store information and conversion tool.
What sort of issues can using smartphones in points of sales address? Have all retailers adopted the technology? Is the vital issue of data security an obstacle to deploying mobile technologies in stores? Renaud Menerat, Chairman of the Mobile Marketing Association France (MMAF) and userADgents, a mobile marketing consulting firm, gave us the answers to these questions.
The aim of the Mobile Marketing Association France (MMAF) is to promote the development of mobile marketing. To do so, this non-profit organisation communicates on best practices and use cases, explains the ethics behind it and the methods to apply to implement effective mobile marketing solutions through a series of publications and events like the MMA Forum Paris, breakfast meetings and conferences. The MMAF currently has 130 members and has an international dimension via its partnership with MMA Global in New York, which has over 800 members.
What are the possible uses of mobile technologies in points of sales?
Renaud Menerat: There are two main categories. The first is the technologies that enable retailers to qualify traffic at their points of sales. The idea is to replicate what Google Analytics does for e-commerce players by identifying where people come from and getting a better understanding of their path-to-purchase: what are the “hot” and “cold” areas? What’s the conversion rate? They can then optimise media plans based on sources of traffic, improve their store layouts, and better target and attract consumers. It’s a very data-oriented vision of mobile technologies.
Then there’s the whole consumer side of things, i.e. the services stores can offer using WiFi, Bluetooth, ultrasound or NFC technologies. These technologies can allow retailers to detect when a customer is in the store, personalise applications or send hyper-contextual, micro-localised notifications.
“addressing the needs of points of sales whilst offering services to consumers”
Mobile technologies can achieve two objectives: on the one hand, address the needs of the point of sale, and on the other, offer consumer services, because they’re actually linked. When you equip a store with BLE (Bluetooth low energy)-type technology or WiFi, you have both an analytics dimension and a service dimension.
Some companies are driven by a need to understand where their consumers come from and how they move around the store whilst others want to know what they can offer customers: a welcome message when they enter the shop, switch the store’s app to in-store mode. This is what brands like Fnac and Apple do who, when customers enter their stores, change the interface of their mobile app from a remote shopping scenario to a brick-and-mortar-oriented service.
And it’s not just shops: banks, railway stations, airports, stadia and hotels are also using these technologies. It’s difficult to say which industry sector is the most advanced: there are all sorts of ideas and tests going on by a variety of companies, mainly involving digital interaction in brick-and-mortar stores via smartphones.
“the digitalisation of the physical world is something everone’s interested in”
What are some of the more striking examples you can tell us about?
UserADgents has published a survey based on a number of use cases, which deal with the drive-to-store issue: how to get consumers to travel those last few metres into the shop, via interactive shop windows or beacons.
Another example is in-store guidance services, such as deployed by department store Galeries Lafayette or Carrefour with LED. Basically, when a customer is looking for a product, it’s micro-located and then the customer is guided right to it. There is also a range of solutions for discovering products, such as via QR code-scanning or EAN barcodes.
With solutions such as Apple Pay, customers can now pay with their smartphone at certain shops, either at the till where there are NFC terminals, or by directly scanning the product and paying via the Apple app.
Loyalty programmes, meanwhile, are very closely linked to payment: by keeping track of customers’ purchase history, retailers can reward customers by offering, for example, rewards every time they enter a store. Loyalty cards can also be digitalised, with a mobile app whereby you can track your loyalty points.
We basically cover the whole path-to-purchase: from drive-to-store – i.e. how to get people into the store – to when customers leave the store – and how can we get them to come back – with experiences and services for consumers.
Are payment and customer loyalty retailers’ main concerns?
That’s the real crux of the matter. Of course, drive-to-store and product discovery are important. But once a transaction is recorded – which is something mobile payment enables us to do – you can improve customer retention, for example, by sending the receipt or warranty or even a tutorial if the product in question requires particular instructions for use.
Nowadays, when you pay by credit card, the transaction is recorded, but we don’t really make the most of that. The store can’t do anything with it, whereas with mobile technology, it can use it to offer services to consumers, whereby they can access, either via the store’s app or their online account, invoices, warranties, etc. That really makes a difference, and means you can measure conversion rates for in-store customers.
“legislation is advancing more slowly than technology”
Is the issue of data security an obstacle to rolling out these types of technologies?
It’s a key issue, especially as legislation is advancing more slowly than technology – or even consumers. The problem now isn’t payment, because the various companies are always fighting over who data belongs to: anything to do with the banking sector is very clearly regulated.
The issue is more about technologies such as Bluetooth and WiFi, which can collect consumer information. As far as collecting, using and storing data is concerned, there are various rules about data anonymity, but the legal framework isn’t quite finalised, although the CNIL* has ruled on some points. The companies who implement these solutions have to be transparent with consumers about the collection and use of data in retail outlets.
Consumers aren’t necessarily aware of this so it’s not an obstacle to use. But it could be in the future, if stores record visits and use information that was gathered passively and without opt-in_email.
So will all points of sales be digitalised in the future?
“IT’S a slow process”
*Commission nationale de l’informatique et des libertés, an independent French regulatory body in charge of data privacy law compliance, Ed.
These days, anything that’s online is pretty easy to manage. The question now is about the digitalisation of physical assets, i.e. products and points of sales. But as we’re talking about brick-and-mortar stores and interacting with consumers’ devices, it involves technologies that are costly to deploy.
It’s a real issue, and in order for it to be worthwhile for retailers, you need a pretty wide audience base. At the moment, whatever the technology used (with the possible exception of WiFi), you can assume that for a hundred people, fifty with have a smartphone, twenty of which will have enabled their Bluetooth. At best, ten will have downloaded the store’s app, and only half of them will have opted-in to receive advertisements. When you deploy these technologies, you’re dealing with a consumer base that’s still in its infancy, so you have to base your experience on that 5% to 10% of people who come into the store. That’s why brands aren’t really investing much in this area, because the impact on business is still minimal. To offer solutions that target not a sample but the majority of your audience at a point of sale, you need a higher equipment rate and that takes time. But it’s vital that stores start launching initiatives in this area are soon as possible so they can understand uses and the possible advantages.
Also on our blog: Retail: mobile devices are the new aid for points of sales