Digital interactions influence 36 percent of all sales, but according to a new study, retailers may be concentrating too much on selling and not enough on influencing shoppers along the path to purchase.
Digital touch points account for roughly $1.1 trillion in annual sales, according to a new study from Deloitte Digital. By the end of 2014, that number will climb to 50 percent, or $1.5 trillion of total store sales.
The study, "The New Digital Divide," quantifies how shoppers are using the spectrum of devices at their disposal, including desktop and laptop computers, tablets and smartphones, to influence brick-and-mortar store sales.
"Mobile and online transactions represent only a sliver of total retail revenue potential," said Kasey Lobaugh, principal, Deloitte Consulting LLP and Deloitte Digital's chief retail innovation officer. "Retailers that narrowly focus on digital commerce – rather than the full journey that leads to a purchase – often fail to recognize how their customers shop and make decisions in the store."
Retail marketers have been focused on the path to purchase for years, and the term "shopper marketing" is the mantra. The advent of smartphones has further complicated the equation and the result, according to Lobaugh, "is a digital divide between what shoppers do and what retailers deliver. This gap not only threatens overall revenue, but requires retailers to reset the way they measure and invest in digital efforts."
Deloitte estimates that m-commerce sales are roughly $40 billion today. Deloitte Digital's data indicates that mobile-influenced sales in the store have reached $593 billion, suggesting that smartphones' influence on store sales has far surpassed the rate at which consumers make a purchase directly on their phones.
The survey found that shoppers who used a smartphone while in stores were 40 percent more likely to make a purchase than those who did not. They were also 22 percent more likely to spend more than they planned.
Social is playing a role as well, with 75 percent of shoppers citing product information found on social media as influencing shopping behavior and increasing loyalty.
"Each interaction is an opportunity for a retailer to enhance the customer experience and tell its brand story," said Jeff Simpson, director, Deloitte Consulting. "However, retailers often measure success solely on how many widgets they sell through their Web or mobile sites. For example, retailers might regard online shopping cart abandonment as a failed conversion when in reality, it may represent a customer who started their wish list in the online basket, but chose to purchase the items in the store. In that case, digital engagement may have led to a sale in the physical store. This impact is much higher when measured holistically across the organization and regardless of channels, rather than force-fitted to a single point of purchase."
Brick and mortar still represents the overwhelming majority of purchases, and while online is growing, the influence of mobile on all channels before a purchase is made is where retailers and brands need to focus.
-See this Deloitte Digital press release
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