Today Mike Ewing and Mike Redbord attended the “Technology and the Retail Transformation: Mobile, Social, and eCommerce” Panel hosted by MITX , sponsored by the High Start Group . Breakfast and a fantastic panel occupied the morning at CSN Stores new 24 th floor offices in downtown Boston.
It was a fantastic discussion and below are 4 topics regarding the convergence of these technologies and the future of marketing, retail, and online commerce. We hope you enjoy!
1. Is social commerce for, or against, the merchant?
The big talk of the day was about social commerce. Groupon is probably the best known of social commerce sites, the 69 th most popular site in the United States in December 2010, according to compete.com . These sites allow consumers to access deep discounts from merchants at scale.
On today’s panel was Jim Crowley, President and CEO of BuyWithMe , the #3 social commerce site today. Also on the panel were two retail managers: Dustin Humphreys, GM at CVS.com , and Mike Dreese, CEO and founder of Newbury Comics .
Retailers are concerned that social commerce has four very real risks for merchants:
1. Social commerce is buying customers that can be bought, and may have lower lifetime value to the merchant.
2. The pain that these social commerce sites solve for is the consumers, not the retailers.
3. Social commerce has many, many players of different sizes and flavors. Choosing one is difficult.
4. Privacy and FCC concerns of digital couponing.
Jim from BuyWithMe, the social buying site, clearly recognized the need to prove the value of the audience he can bring to retailers. BuyWithMe is developing a set of tools for merchants that will help them understand and move the needle on a variety of metrics, manage coupon redemption, and much more.
Social commerce is still new and some businesses have been burned, while others have experienced wild success. Make sure not to over-commit your business and track your success over the long-term as closely as you can. Be aware that the competitive and legal landscapes are ever-changing.
2. What about consumer privacy?
An audience member raised an interesting point regarding the privacy of these new payment methods during Q&A: with each of your purchases on a coupon site comes a ton of information about you. Over time, this information is radically valuable to advertisers and other companies as a lifetime of purchases at multiple companies.
Dustin Humphreys of CVS.com answered the question by raising a point of interest regarding privacy issues and the lack of FCC regulations in the digital couponing industry. For example, Groupon’s gifting application could be in violation of state laws for gift certificates while the data gathered from middle commerce businesses could be used for scrupulous gain. There are numerous other cases of “gray area” coupons that could face FCC regulation in due time. Mike Dreese, the other voice of retail on the panel, echoed Dustin’s concerns that over the long term, things could get dicey.
Investigate the privacy policies of any new technology you engage in and update your privacy policies accordingly. Make sure your privacy policies are up to date and easily accessible for your consumers.
3. Should you spend marketing budget on advertising or repurpose your pricing models toward coupons?
As Jim from BuyWithMe astutely observed, every type of retailer uses offers to draw traffic and sales in to their site. This includes the “every-day-low-price” Wal-Marts of the world and the “high-low” luxury retailers of High Street. Offers and coupons drive traffic and sales, period, the whole panel agreed.
In the couponing world of social commerce, shopping cart software, and digital couponing services, the big winners will be those who can offer scale for merchants and deep analytics tracking for deals sold. Coupons without tracking and a business without scale are worthless, agreed nearly everyone on today’s panel.
Thinking of spending your marketing budget on advertising or outbound methods? Consider repurposing your budget to an inbound, offer-based marketing strategy on your own site.
3. Is your store ready for cutting-edge payment technology?
Mobile commerce solves a real pain for consumers by providing easy access to price comparison and multiple store shopping options. However, access to price comparison and shopping options has created a pricing war between retailers and essentially lowered profits and ROI for many large retailers. This pricing war has created opportunities for businesses to address the pain created.
Andrew Paradise, CEO and Founder of AisleBuyer , spoke about his business that attempts to address the pain of an emerging pricing war between online and offline channels. His business allows consumers to:
1. Scan barcodes of products in-store
2. Pay for the items with their mobile device
3. Show the receipt to an attendant of the store and walk out without connecting with an actual cashier
Andrew is hopeful to attract retailers of all sizes to his mobile commerce platform, and is banking on the continued prevalence of the mobile phone with consumers. As consumers, the audience reacted favorably to this idea and the prospect of skipping long checkout lines.
However, Dustin and Mike, retail managers for CVS.com and Newbury Comics, respectively, voiced a strong preference to wait for a clear leader in mobile commerce before their companies are ready to adopt a method for in-store mobile purchases. They are hesitant to adopt m-commerce technologies without significant proof that it will significantly move the revenue needle. New technologies such as AisleBuyer are great for small to medium size business, but tough to adopt for large retailers because of the additional internal resourcing and training needed to execute the new technology.
Consumers will be searching on their mobile device for products. Smaller retailers have an opportunity to take advantage of new technologies and optimize stores for mobile browsing and buying. Live on the bleeding edge of m-commerce technologies if they will move the ROI needle for your company.
Which of these issues do you think is most important?
Originally published Feb 11, 2011 1:00:00 PM, updated February 01 2017