The e-retailer heads into the holiday shopping season behind a 30% increase in fulfillment spending and a widening net loss. North American sales increased ...
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I find no signs promoting shopkick anywhere in the store. I approach the first employee I see and ask him what shopkick is and how it works. He immediately retrieves a manager who seems to know the broad basics of the program; he says it was highlighted in a training video. He says he mainly sees consumers walk in, hold up their phone to get their kicks and walk back out, noting that many times it's the same consumers doing this routinely.
The store does not have Wi-Fi, but the shopkick app works fine on my 3G network connection. I'm also able to download the branded American Eagle app, which is not promoted anywhere in the store. It has bar code scanning functionality—but I must create an American Eagle account to use it. So I do. I scan two items, neither of which returns any results. However, that could be because they were on the sale rack and perhaps not available online any longer.
Next I head over to Best Buy—also a shopkick retailer. Best Buy, unlike the other stores, attempts to use shopkick to get me to interact with items and travel the aisles. The app tells me I can nab 100 points for buying a specific HP Ink Cartridge and 15 to 25 points for scanning various items throughout the store. I grab a store associate to help me locate the items, scan and collect my points. The employee says he occasionally get consumers asking him to help him locate items to scan for shopkick points.
Next I try some of the price-comparison apps promoted by two big web players, eBay and Amazon. There is no public Wi-Fi access in Best Buy, but my 3G network is working relatively fast, so I use eBay's RedLaser app to scan a Logitech wireless headset selling for $99.99. I find it on CircuitCity.com for $71.71.
I also try out Amazon Price Check. I scan a Logitech tablet keyboard listed for $69.99 at Best Buy and find it for $45 on Amazon.com.
I ask Best Buy what it is doing to combat showrooming. A Best Buy spokeswoman points me to Best Buy's price-matching policy, which says Best Buy does not match competitors' web prices, but will match the price on an identical available product at a local retail competitor's store, a local Best Buy retail store or BestBuy.com.
I walk the store looking for any sign or promotion of Best Buy's own mobile app or site. Nothing. Although I can download the Best Buy app in the store and scan QR codes for ratings and reviews on a few items, including high-end TVs, I'm pretty much on my own to figure out how to do it.
My final stop is discount apparel chain Old Navy. At last! Store signage! Smack in the front of the store is a brightly colored sign asking me to download Snap Appy, an Old Navy marketing app. "It works like magic! Unlock great deals and amazing surprises!" the sign promises. I download—again no Wi-Fi but my 3G works. Then I ask an associate what surprises are in store for me. As in other stores I visited, he goes to locate a manager. I start investigating myself. The app essentially encourages me to scan any Old Navy logo in the store, then spins a virtual wheel to reveal my prize. My first two scans return fun facts about Old Navy terminology, not exactly thrilling in my book. My third scan nabs me $5 off my purchase.
I can't help but think that the Snap Appy is competing with shopkick, which the store uses as well. How many apps will a shopper download and use while in a store? I ask a store associate, who doesn't know.
Home Depot Takeaway
Home Depot takes the first step by offering free Wi-Fi, but it doesn't close the deal by doing anything to promote its app in stores. That's also true of other retailers, says David Eads, CEO of mobile commerce consulting firm Mobile Strategy Partners, who argues that promoting mobile apps would boost in-store sales. "Retailers aren't moving as fast as they could," Eads says. "People have physically come into their stores. Brands need to close the deal."
American Eagle Outfitters Takeaway
Shopkick costs retailers something—a small fee for each kick and a percentage of each store sale when points are redeemed—and it does not appear American Eagle is doing enough employee training to gain a return on that investment. Nikki Baird, managing partner at research and advisory firm Retail Systems Research LLC, had a similar experience when she asked employees about gaining access to a dressing room in American Eagle's flagship store in New York's Times Square, where shopkick promised she could scan a bar code to earn kicks. "No one knew what I was talking about," she says. "Experimental marketing people might think shopkick is cool idea, but they aren't committed to it if no one knows about it and there is no signage."
Best Buy Takeaway
The common view that Best Buy is vulnerable to online competitors is borne out by my experience. "Best Buy is hurting bad because of shoppers using it as Amazon's showroom," says Eads of Mobile Strategy Partners. "Shoppers use their phones to see if the product is cheaper online once they decide to buy it after seeing it in Best Buy."
Old Navy Takeaway
Employees need to know the retailer's mobile marketing strategies and how they work, Baird says. Meanwhile stores need to decide on a mobile strategy, stick to it and train employees on it.
"What we really need is a leader with a clear vision of how apps should be used in stores who then proceeds to take steps to relentlessly promote that vision," Baird says. Based on my visits to these stores, retail chains have some work to do in communicating their mobile vision to shoppers and employees.