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Why Wi-Fi is becoming a must-have amenity for retailers

By Eoghan Phelan:

Wi-Fi in public locations is certainly not a very recent phenomenon. Venues such as caf?s, bars and hotels have been offering this service to their customers for the past number of years with the number of hotspots in these sectors growing year on year. It is, however, only in the past year to eighteen months where Wi-Fi has started to become a hot topic in the retail sector, with a number of leading retailers installing Wi-Fi in-store. The reason for this sudden interest in Wi-Fi from retailers is, of course, the evolution of the smartphone, and specifically how the smartphone has impacted on the path to purchase. From the plethora of shopping apps now available, to shoppers researching products and comparing prices online, to interacting with social media and the growing maturity of mobile coupons, how we shop has now changed irrevocably.

Wi-Fi as a shopping assistant

A study by Deloitte in 2012 found that smartphones currently influence 5% of annual bricks and mortar retail store sales, with this figure predicted to rise to 19% by 2016. According to this study almost half of all shoppers say their phones have influenced their decision to purchase an item in store, and it would be remiss of us to think that Irish shoppers are behaving differently to our international counterparts. Research published by Google in May of last year supports this with 27% of Irish smartphone users stating that they intentionally have their smartphones with them to compare prices and inform themselves about products, and 16% of Irish smartphone users are researching products while in-store
This type of behaviour has led to a fear among retailers of the dreaded ?showrooming? effect, where shoppers, particularly those shopping for higher ticket items like electronics or clothing, will visit the store and choose their desired product, then purchase it online for a cheaper price. Perhaps surprisingly Deloitte?s research found that shoppers store related mobile activities are contributing to ? not taking away from- in-store sales, with smartphone shoppers being 14% more likely to convert and make a purchase in the store than the non-smartphone shoppers. The reason for this is the impact that convenience and immediacy has on the purchase decision.
Take a shopper in an electronics store looking to purchase a new TV. They see a model they like and use their phone to go online to read some product reviews and compare prices in other retail outlets and from online sources. Once they see that the product has received favourable reviews they are now more inclined to purchase it so they go about comparing prices. If the price differential is not overly significant very often the convenience of purchasing there and then, will override this. If that same shopper did not have a smartphone to hand they wouldn?t have the assurance of the product reviews and may fear that they were being significantly overcharged so they wait until they go home to check out the product reviews and compare prices online, by which time the convenience and immediacy of buying in-store is gone, so the sale may be lost for that store.
What this goes to show is that retailers should view mobile as an opportunity not a threat. There?s no point living in fear of showrooming or trying to stop shoppers from undertaking this type of behaviour in-store. This is the reality of today?s shopper so as a retailer you have to see how you can use this to your advantage. Tesco?s Chief Information Officer Mike McNamara summed up the attitude retailers should take to this type of behaviour when, speaking about their intentions to roll out free Wi-Fi in-store, he said ?You can stand Canute-Like and pretend nothing is happening, or you can say it?s happening, and I am going to help it happen.?
Helping it happen also helps retailers take control of the conversation. When a shopper accesses a retailers Wi-Fi network, the retailer can use the landing page to promote special offers and drive additional sales. They can direct shoppers, looking for more information and product reviews, to their own website. Shoppers could also be given the opportunity to check for availability of products not available on the shop floor by scanning a barcode and purchasing the product online, thus keeping that shopper from shopping elsewhere. For a retailer it shouldn?t be about online versus offline sales, it should be about how the two channels can work together to create an integrated 360? shopping experience for their customers. Debenhams are an example of a retailer who are merging their online and offline channels through the provision of free Wi-Fi in their stores, with Simon Forster, Director of Debenhams.com stating ?We?re seeing the shape of shopping in the future emerging right before our eyes?free W-Fi has the potential to transform how people shop.?

Wi-Fi as a source of data

Wi-Fi can also serve as an important tool in gathering data on shoppers and their shopping behaviour, which can help to unlock valuable insights. At its? most basic level, a Wi-Fi service in-store can provide retailers with a valuable email database of their shoppers which can be used to entice shoppers back into store with notifications of promotions. By asking the right questions on the registration page, retailers can segment this database by age, gender and location to further target their offerings. These targeted offers can also be shown to shoppers as they log on to the Wi-Fi network and retailers can then analyse which offers proved to be of most interest to shoppers by analysing click-through rates, and whether these click-throughs converted into sales either in-store or online.
Wi-Fi can gather a plethora of information for retailers from busiest days and times to average time spent online and type of device used. When this type of information is cross-referenced with the demographic information gathered during registration it may very well throw up previously undiscovered patterns which could lead to retailers running promotions or events targeting specific shopper segments at optimum times for this type of shopper.
Wi-Fi can also help retailers better understand shopper behaviour and take action to address any negative findings. If, for example, a retailer finds that shoppers are regularly searching for more information on a certain product, but sales of this product are poor, the retailer can themselves compare prices with other online and offline retailers and determine whether they need to reduce their price.

Wi-Fi as a consumer expectation

Ever increasing broadband speeds, added to the proliferation of public Wi-Fi hotspots in bars, caf?s, hotels and almost anywhere else we may choose to spend our leisure time means that we have now come to expect instant internet access, where and when we want it. To this extent consumers will very soon start to think negatively of venues which don?t provide them with Wi-Fi. When you also take into account that many retail outlets are veritable black holes for 3G reception this feeling of negativity will only be enhanced as consumers start to resent the store for denying them the opportunity get online instantaneously. It should also be noted that this isn?t something that only applies to shoppers who are using their phones as shopping aids either. In an age where many people can?t bear to be in a different room than their phone for more than a few minutes, being in a venue where they can?t connect to Facebook, Twitter or WhatsApp for a sustained length of time is, for this growing number of us, akin to torture. This consumer demand for internet access is something that Maplin, the electronics retailer, recognised when launching free Wi-Fi in over 200 stores, with their Marketing Manager, Chantelle Roach, stating ?Wi-Fi in-store has become a consumer expectation rather than a luxury. Retailers need to embrace it or risk losing out?
One crucial word, which binds all these examples of in-store Wi-Fi together is the word ?free?. For a retailer to launch a Wi-Fi service which customers are charged to use could possibly lead to antagonising shoppers even more than if they did not provide the service at all. Research from Wi-Fi specialists JiWire highlights a stark contrast in the models for public Wi-Fi locations in the U.S. versus the rest of the world. Of public Wi-Fi locations worldwide just 21% are free, whereas in the U.S. this figure stands at 81%, with free Wi-Fi hotspots growing by 30% in the last year. This is certainly one area which we should look to America as an example of how things should be done. In just a few years the very notion of charging your customers to use Wi-Fi will seem absurd. Even having to go and get a slip of paper from a cashier and enter a code to get online will seem like an ordeal to consumers for whom instant internet access will seem like a divine right.

At a time when every day seems to bring another news story of a high street chain closing its? doors for the last time, the importance of embracing online retailing, and having an integrated online and offline strategy, has never been more apparent. Anything which can help serve as a bridge between online and offline, while simultaneously providing your shoppers with a service they desire, can only be of benefit to retailers. They most certainly do need to embrace it or risk losing out!

Source: http://www.visualise.ie/blog/?p=487&utm_source=rss&utm_medium=rss&utm_campaign=connected-consumers

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