Walmart exec: To combat Amazon, focus on in-store experience
NEW YORK - A Walmart executive at the Mcommerce Summit: State of Mobile Commerce 2013 conference said that while customers may be showrooming in retail stores, Amazon is still hampered by the fact that it does not have a physical presence.
With the growth in smartphone adoption, Walmart and other bricks-and-mortar retailers are increasingly faced with shoppers comparing prices in-store via their devices and sometimes purchasing online from Amazon.com or someone else. However, the advantage Walmart has is its physical locations, with mobile playing a key role in how the retailer is enhancing the in-store experience.
?How do we defend ourselves?,? said David Shreni, director of mobile strategy at Walmart Global Ecommerce, San Bruno, CA. ?We'll be different, we don?t? need to out Amazon Amazon.
?You can walk into a store with a phone ? yeah, Amazon is walking in there,? he said. ?But they are walking into my store.
?Amazon isn?t there so how do I make that different in terms of an omnichannel experience. I know I am different and I can play a different game because of that and it is fundamentally because I have a brick-and-mortar store.?
The Mcommerce Summit: State of Mobile Commerce 2013 conference was organized by Mobile Commerce Daily.
Marrying physical, online experiences
As a growing number of customers walk into stores with a smartphone in their pocket, mobile is turning into the key technology for marrying together physical and online experiences.
Mobile is expected to influence 5 percent of in-store purchases this year, with the number jumping to 20 percent by 2016, said the executive.
As a result, it is critical for retailers to have a mobile optimized online experience, and also consider other ways to mobilize the in-store shopping experience with mobile tools
?We are fundamentally committed to delivering a robust set of tools to our customers while they are in the store,? Mr. Shreni said. ?We think that is absolutely critical.
?It is table stakes to have an online experience because it enables access anytime anywhere,? he said. ?We now want to think about how do we mobilize the store experience with a compelling set of tools in the store and marry that with the online experience.
?You can?t just have one and have a multichannel experience. You have to have both.?
A single point of view
Currently, Walmart offers a mobile site and apps for the iPhone, iPad and Android, with users able to engage with the retailer and purchase from any of these.
Walmart is focused on presenting itself with one point of view to customers no matter how customers are interacting with the brand.
To accomplish this, the retailer brings together its online, mobile and in-store staff came together to create mobile solutions that solve problems for customers such as shopping lists, bar code scanning, checkout, store locator, interactive local ad, ereceipts, Scan & Go and in-store mode.
?Regardless of you how you want to interact with us, we are here to help you and mobile is truly the glue that brings this all together,? Mr. Shreni said.
?For those of you that have brick-and-mortar experiences, it is critical to understand what your customers are doing in the store and how can you can connect that to your online experience and that is what we hope to do with mobile,? he said.
Walmart?s mobile focus is driven by the fact that its internal research shows that more than 50 percent of its customers are walking into its stores with a mobile device in their pockets.
For a retailer that has over 100 million weekly shoppers in the United States, this is a significant number.
The number of mobile-enabled customers is only expected to grow, with everyone on the planet expected to have a smartphone in the next five years, per Mr. Shreni.
Just as importantly, many of these mobile-enabled consumers will have never used a PC before, which retailers need to keep in mind as they develop their mobile products.
?Don?t build an app based on your Web site,? Mr. Shreni said. ?Build an app that acts as if your Web site never existed in the first place.
?Build the app for a person who has never used a desktop computer because they are coming soon,? he said.
The path to purchase
The merchant has built up its mobile strategy very quickly over the past two years, including with the opening of its WalmartLabs innovation office located in Silicon Valley.
The focus is on the smartphone, which is driving technology and innovation in terms of where the retailer is headed.
Walmart?s research also shows that mobile is playing a role throughout the entire path to purchase in the store, with customers searching for products on their phone, scanning bar codes and looking for ways to enhance the checkout process.
The retailer looks at how it can create mobile solutions that solve in-store problems for shoppers.
It is also important to keep in mind how quickly the space is changing, with iOS 6 already having 76 percent penetration and Jelly Bean for Android at 25 percent.
Additionally, wearable smart devices are suddenly a hot topic when 18 months ago barely anyone had heard of them.
The key is to think of mobile not as a tiny version of the Internet but as an extension of the user?s hand, enabling them to act on what they are doing and feeling.
As such, mobile brings a lot more context to the equation than the telephone or the PC has ever been able to bring. For example, Apple?s Siri mobile assistant knows where users are and can tell them where nearby restaurants are.
?A smartphone which is not only an interactive two-way form of information and provides a lot of the information around me in the world but it also provides context,? Mr. Shreni said. ?Context is really the game-changing element for what smartphones bring to the user experience.
?Because you can?t walk with a PC into store ? they walk with a smartphone into the store,? he said. ?They are also sitting in a restaurant or are sitting on the subway with their smartphone.
?So that context is constantly changing.?
The first phase
There are a lot of sources for providing context and making mobile experiences more relevant and it is the retailer?s job as a technology and service provide to filter through what is important.
Location is one important contextual factor for mobile. For example, Walmart offers an in-store mode for its mobile app, with the experience in-store customers have on the app differing significantly compared to users who are outside the store.
Currently, mobile retail is still in its first phase with retailers trying to figure out how to provide the online world in a smartphone experience.
?The next phase where I think we are all headed is how do I marry that with real life experience and the context of the world around me,? Mr. Shreni said. ?Retail still has a long way to go to in terms of taking into terms what that context is.
?We are not there yet and Walmart is not there yet,? he said. ?We are still experimenting.?
One of the biggest challenges retailers face is getting excited about new technologies and getting too far ahead of their customers.
It is important to consider if customers are really going to use the new technology.
For example, Walmart is studying what its customers are going to do in terms of mobile payments but that right now it is still early on for mobile payments.
Responsive design is another area the merchant has taken a look at and determined that in some cases it works great and in others it may not be the right solution. Walmart has also considered hybrid native, Web-based experiences.
?We struggle with internally, wow there are so many interesting technology,? Mr. Shreni. ?But we have to be very careful not to get too far ahead of our customers.?
David Shreni is director of mobile strategy for global ecommerce at Walmart, San Bruno, CA