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(originally published by Booz & Company)


Mobile Now

Today, marketing is more fragmented than ever before. There are myriad channels; consumer touch points; and sources of data, content, and tools. To deliver an integrated consumer experience, manufacturers and retailers need to tear down organizational silos and promote collaboration.

Every team needs a coach. Coaches are responsible for providing a vision for how to win and what plays to run, and for engaging players to unlock their full potential. Similarly, teams need a general manager, who will guide decisions on personnel and resources. How much of, and what parts of, the consumer experience will the organization curate itself? How will the company secure the additional talent, data, and tech-enabled platforms they need to win from an extended team of partners?

The “mobile first” approach creates opportunities across a broad set of players. Media companies can add new value to their relationships with retailers and manufacturers by helping produce content, apps, and insights. They can also help drive adoption by integrating ad campaigns with their content. Marketing services providers and technology companies can support brand manufacturers and retailers by developing and providing specialized mobile capabilities.

Getting Mobilized

The mobile future begins now. The four principles outlined here will help companies secure the vision, the plans, and the capabilities required to deliver seamless consumer experiences that bridge the digital and physical worlds and create greater value for consumers. Companies that begin this work today will be able to achieve transformational improvements in the coming years. Those that wait too long will strain for years to catch up, if they ever do.

Smartphone to Aisle Nine
by Heidi Froseth, Tina Manikas, and Ken Madden

A new study, conducted by Google in conjunction with the Google Shopper Marketing Agency Council, suggests that tomorrow’s big sales driver will be the smartphone. 

With a market penetration already exceeding 54 percent in the United States, smartphones—the most ubiquitous of mobile devices—are poised to transform shopper behavior faster and more dramatically than many marketers and retailers realize. To plumb the role of smartphones as a shopping tool, the Google Shopper Marketing Agency Council recently conducted a study of a representative sample of 1,500 U.S.-based smartphone owners over age 18. The survey revealed that 79 percent of them are using their devices in shopping-related activities at least once per month and that smartphone usage is pervasive across key product categories.

“This is quite high,” says Adam Grunewald, mobile marketing research manager at Google, “but I don’t imagine that the percentage of smartphone shoppers will stay at 79 percent. As retailers and manufacturers respond to mobile, the percentage of smartphone shoppers will go up. There will be more apps, more mobile-friendly websites, and more mobile payment solutions. Not only will the number of smartphone owners increase, but the percentage of smartphone shoppers will increase as well.”

Among current smartphone shoppers, roughly half use their devices to assist in pre-shopping activities, including looking up store locations, hours, and promotional offers; making price comparisons; and browsing products. Once they get into the store, however, shopping-related smartphone use—often in the form of searching out product information, promotions, and pricing—rises sharply, to 84 percent of smartphone shoppers. The figures for in-store use are higher yet in certain categories: 89 percent of smartphone shoppers in grocery category, and 87 percent in electronics and baby-care categories.

The Google research also found that smartphone shoppers use their phone for shopping-related activities when in the store for a significant period of time. Almost half use their mobile phone for 15 or more minutes per store visit, a finding that suggests that shoppers are obtaining a good deal of value from smartphone use and will take the time to use their devices in the aisles, even in categories where dwell time has historically been measured in seconds rather than minutes.

Further, in a finding that is likely to presage a rush into mobile by many retailers and manufacturers, in-store smartphone shopping appears to result in increased basket size—and the increase is greater with greater frequency of smartphone use. Indeed, the median purchase of the 17 percent of smartphone owners who use their phones while shopping at least once per week is higher than that of monthly smartphone shoppers: high-frequency smartphone shoppers reported baskets that were 50 percent larger in health and beauty, 40 percent larger in appliances, and 25 percent larger in household care.

“Frequent smartphone shoppers are probably using their phones longer while they’re in the store,” says Grunewald, “and they may be using them in more sophisticated ways, with more apps and the like. This increased usage may cause shoppers to buy additional items—via coupons, for example—or to upgrade, based on reviews. Or the ability to do research in the store might simply bolster a shopper’s confidence about a purchase.”

One in three smartphone shoppers is using mobile to replace or supplement interaction with store employees. They search for relevant content, such as ratings and reviews, nutritional content, or other products that go well with what they just put in their shopping basket. This suggests that there is an untapped opportunity for retailers to add value and enhance differentiation by empowering their frontline employees with better tools and information to engage shoppers or to curate the in-store experience in a way that eliminates the need for a shopper to talk to an employee.

The most common in-store smartphone shopping activity is price comparison. Fifty-three percent of smartphone shoppers are comparing in-store prices, which can lead to “showrooming”: using mobile to find a better deal online or at another store and then making the purchase elsewhere. Rather than trying to quash this behavior and risk alienating shoppers, however, retailers should be thinking about how to provide a better overall experience to keep smartphone shoppers in the store, perhaps by using QR codes to unlock exclusive offers and rewards.

Finally, search is the most common way in which smartphone shoppers access information in the store: 82 percent of shoppers are using search engines to browse for product information in a store, versus 62 percent using the store website or the store’s app as the access point. Therefore, marketers and retailers that want to capture smartphone shoppers in the store should have a strong presence on each. 

  • Heidi Froseth is senior vice president of CatapultRPM and leader of its Target team. She is based in Minneapolis.
  • Tina Manikas is a Chicago-based executive vice president and global retail officer for DraftFCB.
  • Ken Madden is executive vice president and head of digital North America for JWT/OgilvyAction, located in New York.
  • All three authors are core members of Google’s Shopper Marketing Agency Council.
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  1. Matthew Egol, Raju Sarma, and Naseem Sayani, “Reimagining Shopper Marketing: Building Brands through Omnichannel Experiences,” Booz & Company, June 2013: How consumers interact with brands has become nonlinear and shaped by many interactions across these touch points, leaving them to curate most of their brand experiences.
  2. Matt Anderson, Stefan Eikelmann, Fabian Seelbach, and Nick Buckner, “Shoppers on the Go: Winning Strategies in Mobile Commerce,” Booz & Company, Nov. 2010: A study highlighting the growing importance of mobile commerce as a way both to understand real-time consumer behavior data and to use in-the-moment analysis to capture market share and influence consumer purchases immediately.
  3. Matthew Egol and J.P. Leisure, “Shopper Marketing 5.0: Creating Value with Shopper Solutions,” GMA, Oct. 2011: Shopper marketing study revealing that leading CPG manufacturers and retailers are increasingly adopting a solutions-based approach to amplify the impact of their shopper marketing investments.
  4. Matthew Egol, Mary Beth McEuen, and Emily Falk, “The Social Life of Brands,” s+b, Autumn 2012: A marketing strategy informed by neuroscience can help companies enhance customer engagement—and make better use of tools such as social media.
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