Local Analytics

Time to put an end to the digital/retail debate

Online to Offline shopping experience

Is digital a friend or an enemy of traditional brick-and-mortar stores?

At the risk of killing the suspense, I’ll answer this question right off the top. Friend. The clear and only answer to that question is digital is beneficial to retail sales, particularly to brick-and-mortar stores.

According to the Washington Post, brick-and-mortar retailers should consider digital devices like smartphones as one of their “most powerful tools for boosting in-store sales.” Our internal figures from client results show that digital can significantly increase in-store visits and sales, through clicks to call and clicks for directions, in addition to other O2O (online to offline) interactions Google bundles as “I want-to-buy” moments. We have also seen digital initiatives originally aimed at boosting brick-and-mortar sales, spill-over to bump e-commerce sales by double digits.

Time to embrace O2O

Deloitte Digital just released a study (download it here) analyzing the influence of digital on retail commerce. The numbers, which are mostly in line with their predictions from  their 2014 report,  clearly show that digital has a broad and powerful impact on retail, regardless of company size, sector or position.

The figure that startles most retailers we talk to is that by the end of 2015 digital devices will influence 64% of all retail sales in the U.S. That’s $2.2 trillion. Trillion with a “T.” That rises to 80% by 2017.

That is a stop-what-you-are-doing-and-reassess-your-digital-strategy statistic. Within about 2 years, 4 out of every 5 dollars spent will be influenced by digital. How do you like your digital plan now? Still confident?

Here are the some of the most notable findings from the Deloitte study, with my comments inline after each bullet:

  • Digitally-influenced consumers buy more and spend more. Consumers who use digital while they shop in-store convert at a 20 percent higher rate compared to those who do not use digital as part of the shopping process.
    • 20%‽ Who’s zooming who? Digital shoppers are whales! Who wants whales? You want whales!
  • Not all categories are equal. Shoppers are defining their own journeys, and more often, are doing this at the category or even the product level. With digital influence ranging from 31 percent for the food and beverage category all the way up to 62 percent for electronics, the variation is clear: category by category, shoppers curate different shopping experiences using digital.
    • We talk all the time about the new shopper journey. The consistent factors are always digital devices, particularly smartphones, and local search. Shoppers aren’t thinking about your store or your brand – their thinking about what they want, they’re searching for it online, and then they’re going to buy it. Simple as that.
  • Consumers are hunters, not gatherers, once they arrive at the store. Nearly 8 in 10 consumers (76 percent) surveyed interact with brands or products before arriving at the store, and are therefore making digitally-influenced decisions much earlier in the shopping process.​
    • The key takeaway here is you have to be present online to capture shopper intent. Grow your online ecosystem: website, apps, local search, directories, etc. You need to be where your customers are.

It’s time to put the debate over whether or not digital has a positive or negative influence on brick-and-mortar retail. The numbers prove that smartphones, local search and engaged digital consumers are the future of retail. It’s now time to move ahead and maximize the benefit for your stores.

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