While some might say that the rise of digital has made the role of the local retail shop obsolete, new research from Google conducted with Ipsos Media CT and Sterling Brands suggests that the relationship between digital and in-store shopping is far more nuanced and interconnected than that. In gaining an understanding of the impact of digital on in-store shopping, we were able to debunk three common retail myths. We also identified ways retailers can use digital more effectively to connect with consumers. With two in three consumers not finding the information they need in-store and 43% then leaving frustrated, digital presents an opportunity for retailers to improve the in-store shopping experience.
The retail industry is undergoing a dramatic shift: In-store foot traffic is down, online research is up and smartphones are becoming increasingly important to the consumer's in-store shopping journey.
To better understand the impact of smartphones and online information on in-store shopping, Google partnered with Ipsos MediaCT and Sterling Brands for an online survey. The study reveals that consumers want more information and customised experiences during their shopping journey: Two in three shoppers who tried to find information within a shop say that they didn't find what they needed, and 43% of them left frustrated. And 71% of in-store shoppers who use smartphones for online research say that their device has become more important to their in-store experience.
Retailers can make use of these insights to connect and engage with people. From providing consumers with local information online before they go to shops to customising their experiences once they're in-store, digital presents new opportunities for retailers to connect.
Here we debunk three common myths associated with the impact of digital on in-store shopping. We'll also highlight how consumers' digital behaviour affects – and in fact, helps – retail shops today.
Online information can propel people to shop in-store
Myth No.1: Search results only send consumers to e-commerce sites.
The Reality: Search results are also a powerful way to drive consumers to shops.
A common myth is that as a result of searching online, shoppers will only visit e-commerce sites. In reality, three out of four shoppers who find local information in search results helpful are more likely to visit shops.
Shoppers are actually inspired to visit after successfully finding out information such as the in-store availability of an item, shop location and hours or pricing at a nearby retail location. But when that information isn't available, shoppers may stay away; one in four shoppers say that they'll steer clear of a nearby shop altogether to avoid the risk of items not being available.
The lesson for retailers here is simple: Digital is a powerful way to connect consumers with shops. One way to do this is by using local inventory ads. These ads allow retailers to provide helpful details such as whether a product is in stock at a nearby shop. Macys.com, for instance, uses local inventory ads to expose local in-store inventory to consumers while they're on-the-go. Macy's Group Vice President of Marketing Strategy Serena Potter says, "Local inventory ads really help us by displaying actual inventory available at a shop nearby. A shopper can take action if she sees that there are three pairs of shoes at the moment, in the size and colour she wants, at a Macy's that's five streets away." Retailers such as Macy's are using these ads to increase the likelihood that a consumer will walk into their shop and buy that day.
Turning your shopper's smartphone into the best sales associate
Myth No.2: Once in-store consumers start looking at their smartphone, the retailer loses their attention.
The Reality: Retailers can grab consumers' attention through search results and their mobile site or app.
Digital is transforming the in-store experience for customers. Our study shows that 42% of in-store shoppers search for information online while in-store. For the most part, they're using search engines (64%). However, almost half of shoppers head to the retailer's own site or app. Only 30% will look up details from a different retailer's web site or app. This presents a powerful opportunity for retailers to connect with consumers – and prevent them from turning to the competition.
Savvy retailers, such as Sephora, are using mobile to deliver a better in-store experience to consumers. Sephora found that its customers rely on their smartphones while shopping in-store to help them find the perfect products. It designed its Sephora App to assist shoppers, giving them direct access to product ratings and reviews. Bridget Dolan, vice president of digital media at Sephora, says, "We think one of the biggest opportunities that we have in retail is for our customers to leverage their phones as a shopping assistant when they're standing in the shop. Having access to this information is that perfect new moment for customers to find everything that they're looking for and get advice from Sephora."
Put simply, retailers can use their online presence – website, apps, mobile ads and search results – to assist shoppers in-store. This includes the integration of local information in their online presence. Geo-targeting content and ads helps retailers connect with shoppers who may be in close proximity to their shop or already there.
A shop tailored to the savvy shopper
Myth No.3: Online research has lowered consumers' expectations of shops; they really just go to a shop to transact.
The Reality: Consumers visit shops for more than just a purchase, and their expectations of retailers are higher than before. They're looking for an informative, customised experience.
Some retailers fear that today's consumers are so well informed before they step into a shop that the shop itself has become nothing but a playground for a quick transaction. In fact, people are visiting shops throughout their purchase journey – even before making a purchase. Thirty-two per cent of shoppers visit shops when they're first thinking about a purchase, and 33% actively research in shops to find out more about a potential purchase.
Retail brands have the opportunity to impress and engage their savvy shoppers in new ways. People want to feel that the retailer understands them, and customisation is a way to accomplish that. Shoppers want shops to provide experiences tailored just for them; 85% say that they'd be more likely to shop in places that offer personalised coupons and exclusive offers in-store.
For example, retailers could offer deals that shoppers can use at a nearby location (30% off today only at a shop near you!). In addition, they can provide shoppers with promotions for related items as well as alternative fulfilment options, such as free home delivery, should the product they're interested in not be in stock. Shoppers are looking to retailers for their expertise, and that includes product recommendations. In fact, consumers are more likely to shop in shops that provide specific recommendations (64%) and let them know what friends and family have purchased (54%).
Digital bridges the divide between consumers and shops
The consumer path to purchase is becoming increasingly mobile. Retailers that provide relevant, local information via search and online presence (mobile app and site) will increase both reach and engagement. While helping to drive shoppers in-store, such information will also improve customers' experience once there. And customised offers and recommendations will help retailers further distinguish themselves. Digital has fundamentally reshaped the shopping journey – in a good way – and savvy retailers who make use of it to attract and engage consumers will find themselves ahead of the competition.
See the "Digital Impact on In-Store Shopping" study conducted by Google, Ipsos MediaCT and Sterling Brands for more information.
Google, Ipsos MediaCT and Sterling Brands research study from March to May 2014. Survey conducted among 6,000 smartphone users aged 18–54 who have influence in the purchase decision-making process of retail, CPG or tech products and have used the Internet to look for shopping-related information.