Amazon launched on Monday ( Nov 22) a new iPhone App for with advanced price comparison features on-the-go. Is this the straw that broke the camels back? Will window shopping now be the only and main behavior for users shopping in the future? Has the Check-in replaced the Check-out? Consumers look through the merchandise like they would through catalogs, but instead of buying it in that store, they hit the button on Amazon, buy it and have it delivered right to their home by the time you get there. This new change of purchasing behavior has evolved considerably with the growth of Smart Phones. Recently it was published that over 60% of users with Smart Phones will do some kind of product search in-store. Google recently launched its own new shopping product called Boutiques.com, and this wave of new eCommerce sites that incorporate mobile and offers is really exploding.
Recently, I have been seeing a lot of local supermarkets migrating to self-serve check-outs to cut the costs at the cash register and make the flow quicker for people to move through the check-out lanes when congested. It took me about 5 minutes to figure out how to use the automated system at Food Emporium and Home Depot, but once I figured it out, It found it quite convenient. But is it more convenient then just doing a quick product search, buying the product and having it delivered to my home.
Like many of the Retail brands, Food Emporium is doing its best to meet these online challenges with its own Online Shop, and FREE Delivery for sales over $75. They have their own strategy for coupons and they have a great methodology of pick-up vs. delivery for making it convenient for their shoppers, but is it enough?
When I searched on Google for Home Depot and clicked on the link, Google kept me within Google’s index for my first couple of searches and clicks on Home Depot. I thought I was crazy when I was navigating within Home Depot’s site, but the URL string in my search bar was still Google? What does Home Depot thing of this? Google is now doing analysis of the users behavior in the site even after the search that is beyond just the lead. They seem to be pushing the envelop to gathering information that is beneficial for them. Google is trying to build deep information even before you can enter the online site of the Retailer for their own competitive advantage ( see diagram)
Retail brands are going to have to come up with new ways of assuring they not only have the right low price, but also the right “stickiness” in their apps to get users to use them over the Amazon’s of the world. With Google running the search show, even when users go to the Retail Brand via the Web, Google is hanging on as long as possible to gather information on the user, making it potentially even more difficult for even Retail brands to understand holistically that first step.
In addition, this new era is one of optimized fufillment where delivery and convenience is potentially the winning card.
2010 seems to be the year of the social promotion. 50% off for this or 90% off for that, if you register for the goods prior is the model that has worked so well for Groupon, but nitche players like Gilt.com, LivingSocial, Yipit and a variety of others are now making it easier for users to find these promotions and coupons related to a location in real-time. This combined with the behavior of social recommendations and purchase history of your “Friends” will add even another unique dimension on the behaviour of online shopping on the go.
Even though Facebook seems to be quite quiet when it comes to eCommerce and one-click to buy shopping, they did have an unique release that better integrates the social graph as part of a sign-on process recently for mobile. Once they also add this one-click to buy and make it easier to find products and services on-the-go, they will become another “Guerilla in the Room” that makes it more and more difficult for the Bricks-and-Mortars” to control that check-out experience.
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Amazon Price Comparison App Aims At Brick-and-Mortar Stores
by Mark Walsh, November 23,2010
Amazon will use the iPhone as a vehicle for snagging more business from brick-and-mortar stores this holiday season. With the company’s new price comparison app for the iPhone launched Monday, users can scan a product barcode, snap a picture of an item, or say a product’s name to find out if they can get a better deal from Amazon.
If they choose to go with Amazon, they can then make a purchase directly through the Price Check app and have it delivered to their home. That’s a clever way to try to take sales away from physical store rivals while shoppers are strolling down their aisles.
“For example, a customer may be shopping for a toy in a toy store and decide to compare the in-store price of the item to Amazon.com and other online merchants using Price Check,” explains Amazon in its announcement. But the third-party merchants online are limited to those that sell through Amazon.
That’s not the same as a popular app like Red Laser, acquired by eBay in June, which lets users scan a product barcode to compare pricing and stock across multiple online and physical stores. Amazon’s new app is essentially comparing its own pricing against that of the store someone is shopping at.
“While we love the search and quick purchase options, the [Amazon] ultimately isn’t that useful because it only allows users to compare a single store price with the prices of Amazon and its sellers,” noted Mashable. Once someone has already decided to brave the holiday crush by heading to a local store, there’s also a question of how often they would forgo an immediate purchase for a better price on Amazon.
The most likely instance for opting for Amazon would be where an item was out of stock and a shopper could use the Price Check to say the product name to find out if was available through the online retail giant. Or where the price difference was big enough to switch to Amazon despite adding in any shipping costs.
A report from research firm IDC Monday revealed that smartphones are changing consumer behavior. It found more than one-third of smartphone-carrying consumers (who represent 24% of all U.S. consumers) “are ready to use their mobile devices in ways that transform how they shop everywhere, and in particular, how they shop in retail stores.” That includes searching for price and product information, comparing prices at nearby stores, and buying things.
IDC projected that mobile-shopping “warriors” and “warrior wannabes” will account for 28% or $127 billion of the $447 billion the National Retail Federation (NRF) estimates U.S. consumers will spend this holiday season. Amazon itself said in its second-quarter earnings report in July that its mobile sales had surpassed $1 billion during the prior 12 months.
Brick-and-mortar retailers have released their own apps to take advantage of the smartphone explosion and aid in-store shopping. That includes major chains and department stores such as Target, which Monday was named “2010 Mobile Retailer of the Year” by Mobile Commerce Daily, Best Buy, JCPenney and Nordstrom.
Julie Ask, a mobile analyst at Forrester Research, noted that Amazon and Best Buy — which finished second and third behind Target as top retailer of 2010 — may actually have an edge when it comes to having more mobile-savvy customers.
“Both sell a lot of products that fall into the sweet spot for mobile — consumer electronics (one of the top activities for consumers on mobile devices around commerce is price comparisons — especially in the CE category) and books/DVDs,” she wrote in a blog post Monday. By creating an app patterned after customers’ mobile habits, Amazon is hoping to drive mobile revenues even higher.
