Urban Outfitters exec shares vision for in-store mobile commerce
GRAPEVINE, TX – The top executive of Urban Outfitters Inc., Anthropologie and Free People said that his company has big plans for using mobile to streamline the in-store purchasing experience during his Shop.org keynote address.
In the current retail environment, it is imperative for multichannel retailers to manage all aspects of their business well and become more channel-agnostic, balancing in-store, online, social and mobile. Urban Outfitters was using SMS for its brands long before the iPhone existed, currently has smartphone applications for its brands and envisions increasingly integrating mobile into its in-store experience.
“We study how, why and when consumers move across channels, because ultimately the more we know about our customer, the more we can tailor the experience for them, and the more we can do for them, which is our goal,” said Glen Senk, CEO of Urban Outfitters, Philadelphia. “We’re studying the mobile opportunity.
“Mobile may ultimately impact the in-store experience more than it impacts the online experience,” he said. “Consumers will be able to walk in store, scan a product, read reviews, share via their social networks and walk out with the product in hand and it automatically gets charged to their mobile device.
“Gone is the check-out line, which is amazing.”
Mobile key to multichannel retail strategy
Mr. Senk said that every part of the enterprise has to work with absolute synchronization, and his company moved from a United States-only single-channel retailer to a multinational, multilingual, multicurrency, multichannel retailer.
Urban Outfitters has found that multichannel shoppers spend two to three times more than single-channel shoppers, and consumers that engage with the brand across three or more channels spend six times more than the average customer.
“In a little more than a decade we’ve expanded from one channel to four and from one country to many,” Mr. Senk said. ”The people who spend six times more on average want to shop with us across all channels.”
Across all of its brands Urban Outfitters’ total sales are expected to approach $2.5 billion this year, including $400 million from ecommerce sales.
Mr. Senk said that Urban Outfitters is on trend to double its direct-to-consumer business in just over two years.
Surprisingly, other than paid search engine marketing, the company spends very little on advertising.
In fact, Mr. Senk said that Urban Outfitters dedicates less than one-tenth of one percent of its revenue budget to advertising.
“We’ve always used our customers to be our brand advocates,” he said.
Urban Outfitters recently launched a CRM retail database, which is unique in that it is based on getting consumers to opt in and offer up information, and it is not through proprietary charge card.
The possibilities for activating that database with mobile are manifold.
“If someone can check out in a nanosecond online, why shouldn’t they be able to check out in store using their handset in a nanosecond?” Mr. Senk said. “Our motto is to give customers access to our brands however and wherever they want it.
“Of our three brands, Urban Outfitters started earliest in mobile, with SMS and now an iPhone app,” he said. “All of our brands are mobile-enabled, but I think Urban has done the best.”
While commerce via the mobile Web or applications is growing, Urban Outfitters is looking beyond that to in-store integrations.
Any way a retailer can reduce the friction of transactions, the better sales will be for that retailer.
Once NFC/RFID technology becomes more commonplace in handsets and at the point of sale, the mobile channel will offer fantastic opportunities to close the loop between marketing and CRM and reduce the friction of closing the sale.
“We all believe mobile technology will boost ecommerce, but I believe it will absolutely revolutionize the bricks-and-mortar retail business.” Mr. Senk said. “Many are focusing on ecommerce and have written the retail business off, but there is tremendous synergy between the two.
“We have to catchy up in the bricks-and-mortar environment, and mobile will help us to do so,” he said. “We will have some form of mobile technology in store by end of the year or early next year, and we’ll have really neat mobile technology 18 months from now.
“Once we can embed contactless credit cards in mobile phones and RFID technology in store, consumers can use their device to scan something, see if their friends like it and if they do want it and they can just walk out and it’s paid for.”
Mr. Senk at Shop.org: