Christmas shopping habits have changed significantly since last year, with cash-strapped consumers using the latest technology trends such as mobile shopping to get the best deals. Here we look at the top five technology strategies retailers are using to stay ahead in an increasingly competitive market.
UK shoppers are estimated to spend more than £1.6bn on their mobiles this Christmas and one in ten presents purchased online in Europe this year is expected to be bought over a mobile device, according to research.
“The two biggest trends for this year are an increase in click and collect orders, up from 4.5% in the third quarter of 2010 to 10.4% this year and mobile sales up from 1.1% to 3.9% for the same period. This is set to continue for Christmas,” said Chris Webster electronic commerce specialist at Capgemini.
Virgin Wines recently launched a mobile version of its website in order to take advantage of this trend. Paul Adams, director of Virgin Wines, worked with software company Mobify to create a mobile version of the site in time for Christmas. “We decided to do this after noticing earlier this year that mobile purchases were between 2-3%, whereas the industry standard was closer to 9%,” he said. After launching the mobile site, customers accessing the website via their smartphones increased by 50%. “The site was so rich and complex before it was almost impossible to navigate on the phone,” he added.
Capgemini’s Webster said another big trend is an increasing shift to multichannel orders. “There’s now a body of evidence that shops with a successful multichannel are doing disproportionately better than those that don’t,” he said.
“Multichannel is about integrating the online and store experience. If this is something companies fail to get right, over time they will lose the battle for market share. Over time we’ll see the continued implementation of kiosk technology, the adoption of things such as using iPads for guided selling. For example, sales people will be issued iPads, so they can put in the customer’s name, view their order history and give recommendations,” he added.
But retailers have not yet achieved full channel integration, he said. “Even retailers with the best multichannel propositions, such as John Lewis, still operate in vertical silos. For example, there’s the option of ordering online and picking up the item in store, but you have to go to the customer collection point so there’s no opportunity to upsell.
“From customers' experience, they want it to be easy to engage with the retailer. If you make it difficult the customer will go somewhere else,” he added.
With a more gloomy economic outlook than retailers had originally anticipated, technology which enables the most cost-effective offerings will play a key part in how successful companies are this Christmas, said Lisa Byfield-Green, retail analyst at Planet Retail.
“Online price checking is becoming more common, prices are more transparent than ever and shoppers can even scan items and check prices while out and about. Barcode scanning company Redlaser is helping with this, also Amazon’s own price checker app encouraged customers to scan items while in retail stores,” she said.
QR codes were also featured highly this year in promotions, in store and to facilitate shopping walls such as Ocado. EBay set up a pop-up store close to Oxford St for five days at the beginning of the month allowing customers to browse and order using QR codes.
There are now 15 million Barclaycard payment cards in the market alone, with the total number of contactless cards having seen a year-on-year increase of 150%.
According to the payment company, 40% of people are not prepared to wait in queues for longer than two minutes. Contactless payment takes half the time of cash payments, positioning stores to take advantage of the Christmas rush. Most recently, the company rolled out 250 payment terminals in the 02 arena, to help cut queue times before Christmas for transactions under £15.
“The big trend for next year is near-field communications (NFC) in mobile payments,” said Richard Armstrong, head of UK payment acceptance at Barclaycard. “Barclays launched its first contactless mobile in May with Samsung. We recently put out another one, Samsung Wave, and are in conversations with a lot of mobile companies,” he added.
Virgin Wines’ Adams said the company’s other key tactic for Christmas was to do a site redesign in summer using programming framework Ajax and open source Apache Solr tools to make the site more user-friendly. A key part of the redesign was to include more social media functions to allow users to share comments and put a Twitter feed on the site, he added. “We wanted it to be intuitive as possible to allow us to expand before Christmas.”
Planet Retail’s Byfield-Green notes that Twitter and Facebook have been much more incorporated into marketing strategies this year, as companies hope to get customers to influence the shopping habits of their friends. Walmart has launched its own Shopycat gift-finder app based on the Facebook interests of the person that you are shopping for, she added.