Third Time's a Charm: Successful Mobile Strategies in the Retail Vertical

Getting Vertical

Third Time's a Charm: Successful Mobile Strategies in the Retail Vertical

By Paula Bernier, Executive Editor, TMC  |  May 22, 2012

This article originally appeared in the May 2012 issue of INTERNET TELEPHONY magazine.

Retail strategies related to mobile communications have been a mixed bag. Using wireless technology as a means with which to alleviate specific customer pain points, however, has been very successful for select brands like Starbucks, Tesco and Walgreen’s. Meanwhile, Macy’s is rocking the wireless opportunity via its Backstage Pass promotion.

Altimeter Group analyst Chris Silva says that the Starbucks effort to lower customer wait times by providing a mobile application that allows store visitors to click to pay using a bar code at store cash registers is a winner. Starbucks first introduced this capability at a handful of stores, but it’s at all Starbucks stores in the U.S. and Canada now, and the company is looking to take it global. Starbucks last year processed 26 million payments accounting for $110 million in revenue using the mobile app, according to a website called The Verge.

Meanwhile overseas, U.K.-based grocer Tesco is leveraging wireless in an entirely different way. Silva explains that Tesco research showed that consumers in South Korea strongly dislike grocery shopping. So in this market the company introduced Tesco Homeplus, which uses signage in the subway to recreate the feel of a grocery store. That way, people can quickly scan with their cell phones the desired items depicted on the subway platform signs and have those products delivered to their homes. Tesco Homeplus has made Tesco the No. 1 delivery grocery in South Korea, says Silva.

And Walgreen’s recently came out with the first mobile application in the U.S. that enables consumers to scan the code on a pill bottle using a smartphone to order a prescription refill. What’s especially interesting about this example, says Silva, is that the person who suggested it initially was told that no one could figure out how to scan a code on a curved bottle. But they did it.

As for Macy’s, the clothing, personal goods and home products retailer provides customers that scan the QR codes on its holiday circulars with hours and promotions at those customers’ area Macy’s locations. This may not seem all that innovative, but it is a leap in functionality when you consider that the initial mobile barcode applications typically just sent consumers to general retail websites, most of which weren’t even optimized for mobile use.

Today, most retailers are on the second or third iterations of their mobile strategies, Silva says. While the first iteration typically involved directing customers to a standard website, he says, retailers tended to go overboard during second-stage mobile strategies and provide too much functionality. But by the third iterations, he adds, retailers are typically dialed into what pain points they’re trying to address for their customers.

Edited by Stefania Viscusi


Sign up for our free weekly Internet Telephony Newsletter!

Get the latest expert news, reviews & resources. Tailored specifically for VoIP and IP Communications.