Retail's Future: Price Comparison Via Smartphone Apps
Almost half of shoppers use mobile apps when they cruise retail aisles. Often, they leave to find cheaper prices.
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Brick-and-mortar retail businesses are under assault from smartphones. New data from Yankee Group shows that a growing number of smartphone users are taking advantage of mobile shopping applications to see where they can get the best deal.
According to Yankee, 46% of shoppers are using mobile apps when they cruise retail aisles. This figure is up about 5% since 2010. Half of the 46%--or one-quarter of shoppers--buy a less expensive product elsewhere once they've compared prices and availability.
Mobile has become a "fundamental part of the shopping experience," says Yankee. More than half of consumers--54%--have downloaded at least one type of mobile shopping application, and about 24% of consumers believe mobile shopping apps are "essential."
Amazingly, consumers are more apt to trust online retailers over regular stores. Amazon, for example, is trusted by 56% of consumers over traditional brick-and-mortar locations when it comes to comparing prices.
Consumers with higher incomes have been faster to adopt price-comparing apps and use them to buy from different stores or request that the brick-and-mortar location in which they are shopping match what they find on their phone. Of those making more than $200,000 in annual household income, 83% are likely to purchase the product online instead. That's damaging to retailers.
"Our survey is a wakeup call--this adds up to millions in potential lost revenue for brick-and-mortars," said Sheryl Kingstone, Yankee Group research director and author of the report.
Speaking personally, I use smartphone apps to compare retail prices all the time, especially on big-ticket items that cost more than a couple of hundred dollars. The likelihood of finding a significant discount for expensive items online can help save consumers like me cash--at the expense of the retailer.
"Retailers must embrace mobile beyond price comparison and target consumers who are not solely driven by price," said Kingstone. "Engaging mobile consumers with tools such as inventory availability, real-time personalized offers, personal shoppers, and self-checkout will make the difference between retail success and failure in the new mobile economy."
Allowing consumers to tap into inventory and other pertinent data could be a huge benefit to traditional retailers. The "immediacy factor" of being able to make purchases instantly, or the same day, can be a powerful motivational factor for brick-and-mortars that they should use to their advantage.
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