Mobile Opportunity

Apps for in-store shopping are on the rise—will c-stores cash in?

Published in Convenience Store Products

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CSP Reporter

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Shoppers who come in to your store, phone in hand, hoping for mobile promotions and coupons might be disappointed. C-stores, unlike other retail channels that are primed to offer couponing and rebate programs to their customers both in-store and remotely, have been slower to adopt the burgeoning technology.

The pressure on c-stores to partake in couponing programs is real—even more so as the retail channel lines blur.

“Convenience retailers [have] been slower to adopt mobile shopping due to the fact that, at least until recently, some of the big drivers of customer use of mobile haven’t fit that neatly into the way customers shop convenience. Now that’s changing,” said Bill Bishop, chief architect for Barrington, Ill.-based consultancy Brick Meets Click.

Digital coupons are becoming easier to use, which should help drive adoption. Mobile apps used for brick-and-mortar shopping saw use in 2014 rise to 41%—up from 21% in 2013, according to Brick Meets Click.

Kathryn Sheaffer, senior associate brand manager for Mondelez International, Deerfield, Ill., sees nothing but positive developments in the coming years for c-stores looking to embrace coupons. “To date, c-store retailers’ adoption rate of mobile shopping in collaboration with Mondelez has not been quantifiable,” she said. “However, [internal corporate initiative] Mobile Futures produced some exciting partnerships and programs with many startups and brands including belVita, Dentyne and Ritz.”

When asked if she anticipated the c-store channel to reach a higher level of mobile competencies over the next year, Sheaffer said, “Absolutely. Technology is helping us create compelling experiences for shoppers, and programs like Shopper Futures allow us to tap into their demand. We’re committed to creating new mobile opportunities to challenge the way we approach consumer engagement and ultimately meet the shopper’s needs.” 

Third-party technology partners do much of the back-office data mining and front-end Web tasks in building these programs, which should be comforting to retailers. With that data, the technology has the ability to create custom apps for brands, automate scorecards and analyze day-part trends, said Jason Lobel, CEO of Chicago-based SwiftIQ, a third-party consumer insights provider with a focus on retail data warehousing and mining.

For those retailers eager to kick the tires on mobile shopping programs, coupon redemption and more, increased functionality is helping the process. Bishop offered these words of wisdom on how to best proceed:

• Tell a story.“What we find is that the most dynamic mobile shopping apps mean building an interesting story around a brand: What makes it special or better? Where did it come from and who actually made it? How is the product different, and what’s the best way to use it in a way to get the most out of it?”
• Don’t underestimate smartphone content. For mobile coupons, Bishop said, content developed is as important as the coupons themselves, and he encouraged stakeholders to “define your total value proposition.” For example, CPGs—and by extensions retail brands—can differentiate by deploying the right tools to make content as “strong, rich and engaging as possible.”
• What’s your priority? “The first questions to be answered are: Are you more interested in driving additional visits or spending per visit?” he said. “Define the mobile experience to set [yourself] apart from the competition. Determine how you will evaluate the effectiveness of your mobile marketing and promotions.”

Another important strategy is to customize and personalize the mobile shopping experience. “It’s about one-to-one relationship building, which means each smartphone user sees different messages when they access a mobile couponing app than another user receives,” said SwiftIQ’s Lobel. When an alert comes to a user’s smartphone, for example, a Mondelez offer for Ritz crackers might be routed to one subset of people, while a rebate for Oreo populates the devices of others.

Questions and Challenges

• As with the adoption of any new service or technology, there are important questions to ask as you begin development:
• When during the day/week should you concentrate your efforts?
• What segment(s) of customers are you targeting?
• How can mobile help you extend the impact of your current communications with customers?
• Is mobile a way to shorten your customers’ wait time in the store and improve speed of service?
• Are there ways to use mobile to help increase the impact of your loyalty program?

Some challenges remain, one of which is the capability of retailers to relinquish data to a third party. “It has to start with sharing data and getting a lot of value back with things like co-marketing [with CPG brands],” said Lobel.

Bishop said that one challenge with sending mobile alerts to smartphones is spam. “The key is personalizing offers to help ensure they’re interesting, relevant and seen as worthwhile by the customer. No one wants spam, and this is particularly true when it comes to your phone,” he said.

“I think this is because mobile plays such an important role in people’s lives and, as a result, they’re quite uncomfortable when they see it being invaded with messages sent without much thought by evident strangers. This whole area of spamming on mobile is probably the biggest risk moving into the area of mobile,” Bishop said.