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Socially Speaking: Your Wallet’s Talking

2012/12/18

Socially Speaking Logo“Showrooming,” the act of examining an item in-store and then price-shopping it online, has become an interesting phenomenon. It is hard to pinpoint how much of a threat showrooming is to brick and mortar retailers. Some estimate that only 6% of consumers showroom, leave a store and purchase from elsewhere (factbrowser.com), while others forecast showrooming will cause all retailers to close all their stores by year-end (2012 Mayan calendar). Regardless of the actual numbers, showrooming is causing many retailers to rethink how they engage customers in-store.

Red Laser has recently collaborated with Best Buy to ‘up’ the level of engagement. The widely-used price-comparison app, purchased by eBay in 2010, added a new feature called ‘In-Store Experience’ which uses a phone’s GPS to determine when a customer is in a store. The results within the app are personalized based on their location and what they scan. Upon scanning, the customer can see product price, availability, promotions, related products and services and even the local store’s open-box stock levels to give them a lower priced option. Red Laser can also use store loyalty card numbers to further personalize the experience.

The new initiative from Red Laser and Best Buy embraces an important social aspect discussed in previous ‘Socially Speaking’ columns—a consumer’s location. It’s a great start. It’s one of the first applications that provides real-time, in-store information to customers armed with smart phones. However, the idea is likely only the tip of the iceberg.

Armed with this new technology, retailers can dramatically change the conversations happening inside of their stores. It’s not long before retailers know who is in their store, when they are there and what they are scanning. Alerts with this information can be routed to store associates equipped with mobile devices. This opens the door for retailers to better engage potential customers and secure a sale while they are in the store. There are countless ways to respond, but here are a few options:

Be social, the “old-fashioned way.” A retailer can send an associate who is familiar with the scanned product directly to the customer to discuss the product. This can include showing videos and online product reviews, discussing complementary products or just being enthusiastic about the purchase. In Eastern Mountain Sports, an outdoor sporting goods chain, there is an expert for every department in the store. You can discuss hiking shoes with someone that has gone on 100 hikes. You leave the store, higher-margin product in hand, knowing you were well advised.

Customer or deal-specific pricing. Using a real-time connection to the CRM, retailers can determine how frequently a customer shops or showrooms at the store. They can determine if customers purchase when a product is new and at premium price, or when the product has aged and been discounted. They can determine if customers accumulate points and how frequently they use coupons. Amazon has become synonymous with “best price” in the minds of many consumers. The tone can change quickly if a store associate can match a price, throw in a related product for free or even offer a gift card for the difference, to be used on a future purchase.

Get the customer their product. This doesn’t sound novel, but it’s rare. When shopping online, most products are in-stock and can be delivered as early as same-day. Often customers are looking at a product but it’s not available in their preferred size or color, out-of-stock or simply too big to carry. Associates can offer to locate the product at a different location and have it secured for in-store pickup or same-day delivery to the customers’ homes.

The old expression that “money talks” has never been more true than in today’s economy. Your phone, however, is becoming your wallet… and it’s becoming pretty chatty. It’s capable of starting a conversation for you when you enter the store, and it can even negotiate a better deal for you. No, not all stores will close—however, it’s the ones that become more social, change the tone and more creatively engage with their customers that will survive and thrive over the coming years.

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