As we approach “FRANkademy Retail and Social Business” this Friday I thought I’d whet the appetite with some observational snippets.
Australia remains emerged in a culture of austerity, caution and uncertainty. This is reflected in part by:
- Australians have increased their savings rate, since the economic turndown in 2008/09, to 10.5% (the highest rate since 1984).
- Consumers are becoming used to price reductions and expect to purchase items on sale, increasingly fuelled by group buying sites.
- A high Australian dollar is a double edged sword for Australian retailers – cheaper for retailers procuring goods from overseas but also cheaper for Australian customers to purchase goods from international online stores.
- Australians are prioritising reducing their debt.
(source: PwC 2011 “Australian & NZ online shopping market insights”)
Some of the issues we shall cover include:
ONLINE SHOPPING; before we all freak out about creating tundra-like conditions at shopping centres let us not forget that of the $216 billion spent annually only 11 billion comprises online, less than 5%! (source: NAB Study).
GROUP BUYING SITES’ business model is that discounts are loss leaders and loss leaders only work in the context that consumers spend—or return and spend—above the loss leader. The reality is that many retailers don’t see repeat customers from online promotions. Group buying are on the wane, likely to become smaller as they serve a particular group of attractions and specialty services.
CUSTOMER EXPECTATIONS have forged ahead as the retail category resolutely has resisted the cost of understanding and innovation. Retailers need to stop second guessing the customer and begin to listen & learn.The shift from an under resourced, under paid & under informed service offering towards a seamless integrated experience needs to happen. Last month’s CMO Survey indicated that consumers priorities have shifted from low price (-32%) to service (+56%)
TECHNOLOGY INITIATIVES do not make for an overall retail strategy meeting the needs of a community. Just because it’s technologically possible doesn’t mean people want it.
BRICKS & MORTAR RETAIL are in a position of strength and can leverage their advantage to fulfill peoples basic needs; to participate in a communal experience of sharing, hearing gossip, escaping from daily life, haggling for a bargain and to feel a sense of community. Part of this dynamic is being recognised and feeling appreciated, enter Shopkick, which introduces real-world incentives to recognise and encourage checking in.
Here’s 4 things to know about Shopkick:
- It rewards customers for walking into selected stores & in-store behaviour
- It generated $110 million in-store revenue for partner retailers and brands in 2011 (source: TechCrunch)
- Conversion rates of walk-ins to sales can be measured directly by counting specific shopkick offers in the basket at retailers, by rewards for purchases through POS integrations, and conversion rates of product scans to product sales can be measured through in-app questionnaires and POS integrations. (source: Founder, Cyriac Roeding)
- Whereas 80% of Foursquare users are male with 70% aged 19-35 the Shopkick profile is 55% female with 49% aged 25-39 and 13% aged 40+
Here’s a slightly cheesy video from their site [youtube]http://www.youtube.com/watch?v=2uixneqbqkI&feature=youtu.be[/youtube]
We’re looking forward to a lively session and hope to see you there!