21 Aug 2015

64% of In-store Purchases Are Influenced by Digital

showrooming

The popularised term of ‘showrooming’ could be long gone, replaced with the ‘digital influence factor’ as coined by Deloitte in their most recent study Navigating the new digital divide.

More and more consumers (one third of the Australian population) are heading to the online shops for their cheaper and faster product delivery but what about the other two thirds still happily buying in-store? In an intriguing approach and one that is surprisingly obvious, Deloitte attempted to discover how people are using their devices to increase in-store purchases.

Rather than focusing on the great divide between eCommerce and in-store, the suggestion is to appreciate the value of digital influence not only in eCommerce but with bricks-and-mortar shopping experiences. When compared in dollar values, digitally influenced in-store purchases make up more than 5 times that of eCommerce purchases.

instore influenced by digital3

Dollar impact comparison between digitally- and mobile-influenced sales and eCommerce in the United States 2014

 

As retailers begin to become more aware of these digitally influenced shoppers, they will use this knowledge to their advantage to help increase in-store sales. As an example, a shopper will very likely be busy checking out your online inventory prior to leaving the house and then reading your online reviews whilst in-store. Retailers could begin to tailor their online presence to cater for their in-store shoppers with review and inventory location options.

Last year, less than 50% of customers were influenced by digital when shopping in-store and this year, that number has leaped to 64%. Consumers will likely never cease the physical shopping experience but will be more and more influenced by digital before, during and after their in-store purchase.

instore influenced by digital2Digital influence factor projection

 

Social Media

The most significant finding amalgamating the great divide between digital and in-store retail is that consumers who use social media during their shopping experience are four times more likely than non-users to spend more on purchases as a result. And better yet, respondents who consider themselves somewhat or very influenced by social media are six times more likely to spend significantly more than non-users (42% vs. 7%).

social media influence

So although consumers are looking beyond the brand and store for advice and inspiration, these influences are bringing in far more positive returns. Retailers who successfully tap into this natural exchange of information and connectivity will undoubtedly see the benefits within their retail stores.

 

How are they being influenced?

As outlined by the study, it makes sense for the connected shopper to now be influenced by a variety of factors leading up to and beyond the sale rather than the traditional method of “see ad…be inspired…purchase”.

There are five ways your shoppers are digitally tapping into your product or service without you even knowing it. How will you permeate these new markets with your brand presence?

 

Inspiration: Around 70% of consumers are finding inspiration outside of the retailers influence from friends, family, blogs, social and traditional media while only 30% are directly influenced in-store or a brand advertisement.

influenced by digital

Research: A large portion of consumers (67%) are browsing the retailer’s site prior to shopping in-store and also 61% are using search engines before heading in-store.

search

Select & validate: 67% of shoppers are reading reviews – and this may be during the shopping experience itself whether on the retailer’s site or third party sites.

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Purchase: Only 13% of consumers are currently using click and pay but this rose to 25% when asked if they would likely use this feature in the future.

Return & service: Around 20% of consumers said they would like to initiate a return from their digital device.

 

How does category influence digital?

Importantly however, the way in which consumers use digital varies considerably by category. For example, consumers are far more likely to use social to assist their shopping journey when in the market for baby and toddler products or home furnishings up at 56% and 40% respectively. But least likely with the entertainment and food and beverage categories at 18% and 21% respectively.

instore influenced by digital

Percentage of consumers that use social media during their shopping journey by category

 

Retailers are fast becoming aware that they need to change their approach as traditional marketing no longer has the market penetration it used to have. But more importantly, retailers  “need to add value at every step that is important to customers and understand deeply what keeps them coming into their stores” Navigating the new digital divide, Deloitte Consulting.

Each category will have a different level of digital influence and it’s a matter of determining where your unique customers are interacting with digital along the shopping journey. Are they connecting to social for inspiration or researching your site before hand? Are they reading reviews about you and if so, are you able to assist this process by enabling reviews on Facebook or on your site where you can manage them? Do you need to offer click and collect, is this something your users would appreciate? And is your site transparent for both in-store users and online purchases?

Managing the unique activity of your customer base will truly help un-tap this vast potential for more connection with your customers along their shopping journey with your brand and ultimately increase sales.

Now we’d like to hear from you. What specific digital methods are you using for your brand to connect with your audience along their shopping journey?

Retail Express – Australia’s leading POS solutions