Thursday, December 16, 2010

Mobile Commerce Cuts Both Ways

Retailers and others in the mobile ecosystem think mobile commerce has lots of potential, in lots of different ways. But mobile commerce cuts two ways. It might prove advantageous for retailers in some ways, and a bit of a threat in other ways.

Until recently, retailers could reasonably assume that if they just lured shoppers to stores with enticing specials, the customers could be coaxed into buying more profitable products as well. The "loss leader" technique perhaps does not work so well when a shopper can do price comparisons using a mobile device, while still inside a store.

Now, marketers must contend with shoppers who can use their smartphones inside stores to check whether the specials are really so special, and if the rest of the merchandise is reasonably priced.

'The retailer's advantage has been eroded,' says Greg Girard of consultancy IDC Retail Insights, which recently found that roughly 45 percent of customers with smartphones had used them to perform due diligence on a store's prices.

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