Retailers Strike Back in Mobile Wars With ... People

As Shoppers Become More Tech-Savvy, Stores Look to Smartphones, Tablets as Must-Have Service Tools

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In an age of the check-in and snazzy, location-based technology, the latest in mobile apps for stores harkens back to the bedrock of retail: service.

"The future of commerce is the history of commerce, going back to the days when Sam Walton knew everyone that walked through the store. We can do that with mobile," said Gibu Thomas, senior VP-mobile and digital, Walmart Global e-Commerce.

Neiman Marcus iPhone app helps connect customers with their favorite sales associates.
Neiman Marcus iPhone app helps connect customers with their favorite sales associates.

As more shoppers use smartphones to find lower prices or research products while browsing the aisles, many retailers are beginning to arm staff with the same tools.

"You can't put the genie back in the bottle," said Michael Murray, Sears Holdings Corp.'s chief marketing officer for e-commerce. "Price is part of the decision-making process, but so is making sure you're able to serve that customer. If you've helped facilitate [a sales decision], people will often buy there, but some will not."

Utilizing an asset that e-retailers will never have -- people in stores -- Sears has deployed thousands of tablets to sales staff to help provide shoppers with information. Other retailers, including Lowe's , Gap, Nordstrom and Macy's , are investing in smartphones and tablets, both as tools for sales associates and as displays where customers can access information.

"Previously you'd have expected store staff to be educated about the products and the brand," said Geoffrey Handley, co-founder and CEO of mobile agency The Hyperfactory. "Now, nine out of 10 consumers know much more than the store staff because they have the tools to educate themselves."

Retailers hope to tip the scales back in their favor.

Neiman Marcus, for example, is testing NM Service, an iPhone app designed to connect customers with their favorite sales associates. When the shopper walks into a store, NM Service alerts the designated associates. With access to purchase history, the salesperson can then text the customer a message, such as "I found the perfect scarf for the suit you bought last week."

"There's no sense in building these great experiences for the consumers but not investing in the staff," said Mr. Handley. His agency helped Lowe's design a Store Associates App, whose features include estimators that help determine how much paint or carpet a customer should buy. The retailer has distributed 42,000 iPhones loaded with the software to its workers.

These new tools also demand a different type of employee. In a Deloitte survey of retail executives, they listed "tech-savvy," "brand ambassadorship" and "specialized product knowledge" as the most important skills for sales associates in five years. That's a big leap from the most important skill today: "point-of -sale assistance."

Not all retailers are investing in the infrastructure needed to make their sales forces more digitally connected. The Deloitte survey found that more than half have no Wi-Fi-enabled stores, and more than one-third have no plans to add Wi-Fi.

Outside of mobile tools for salespeople, many retailers are providing customers with mobile apps to help them navigate stores, get product details or check inventory.

Last year, 39% of brick-and-mortar retailers with top-500 e-commerce sites by revenue had mobile websites and nearly 26% had apps, according to analysis from Acquity Group.

Walmart's app, for example, enables list-making, budgeting and completing transactions. One benefit of such customer-facing apps is relieving associates and thus running locations more productively, Mr. Thomas said.

But there's a threat from the apps provided by online competitors. And it's not alone -- similar percentages of online-only retailers and brick-and-mortar retailers had mobile websites and apps last year, according to the Acquity study. This past holiday season, Amazon gave customers up to $5 if they used its Price Check app to scan items in stores.

In December, 12% of the nearly 100 million smartphone owners compared prices while in retail stores, according to ComScore. That number rose to 21% when all locations were considered.

"Those four walls used to be a sanctuary," said Mr. Handley. "Now customers are in the store but not under retailer control anymore."

Stores are betting that having their own consumer-facing apps and mobile programs will help them regain control. Best Buy, for instance, has added QR codes to store items for customers looking for more product information.

"They're going to keep you in their walled garden," said Devora Rogers, director-global business development at Shopper Sciences, and Interpublic Group of Cos. agency. "Once you've engaged with the QR codes, it's going to keep you in the Best Buy system. It's an effective way of combating price-comparison behavior. It enables [shoppers] while keeping the focus on their product."

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