Retailers shift their ad spending from TV, radio and print ads to digital ads.
The merchant is encouraging in-store shoppers to use its new mobile app.
Saks Fifth Avenue wants its store customers to be as connected as possible. To link them up, Saks is launching free Wi-Fi networks in all 44 of its stores across the country while promoting its new mobile commerce app as an in-store shopping tool.
Saks is using AT&T Wi-Fi technology. Consumers using mobile devices with AT&T service can log on to a Wi-Fi network once and be automatically authenticated whenever they return. Shoppers using other carriers must log on to the Wi-Fi network with each visit. Logging on simply involves selecting the “AT&T Wi-Fi” network option and then accepting terms and conditions.
Saks first launched Wi-Fi at its flagship store in New York in November 2011, and has expanded availability to more stores on an ongoing basis. Since the initial launch, Wi-Fi users have made more than 5 million connections to in-store networks, AT&T says. The carrier also finds:
- Shoppers average more than 19,000 connections per day to in-store Wi-Fi networks.
- While in stores, customers have exchanged more than 17 million megabytes of data to date.
- During the holiday season, in-store Wi-Fi usage increased more than 30% with nearly half a million connections in December 2011 alone.
- The Saks Fifth Avenue flagship store is the most popular place to connect with more than1.5 million connections made to the in-store Wi-Fi network.
By giving shoppers with smartphones free Wi-Fi access, Saks is flying in the face of many retailers’ fears of showrooming, where mobile consumers use stores to look at products but then compare prices on their phones and buy elsewhere. A recent study says Saks may be on the right side of the showrooming debate.
Smartphones will influence 19%, or $689 billion, of U.S. retail store sales by 2016, according to “The Mobile Influence Factor in Retail Sales,” a study of 1,557 smartphone owners from research and consulting firm Deloitte. Smartphones already influence 5.1% of all retail store sales in the U.S., which translates into roughly $159 billion in annual retail sales this year, Deloitte predicts.
61% of smartphone owners who use their devices to shop have done so in a store, the study finds. The Deloitte research indicates consumers’ in-store mobile activities are contributing to, not taking away from, in-store sales, and that smartphone shoppers are 14% more likely to convert and make a purchase in the store than non-smartphone users. This means that mobile is an important tool for retailers to drive incremental in-store sales, Deloitte says.
This conclusion runs counter to the widely discussed theory that consumers increasingly are using physical stores as showrooms where they can learn about and see products in person, and then make purchases from a competitor online or through mobile commerce. The Deloitte study concludes that many shoppers are using their smartphones to enhance their store shopping experience, not to use a store as a showroom for online retailers.