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Retailers hone in on ship-to-store to fuel mobile investments

Walmart, Sears and Nordstrom are a few of the many retailers making a bigger bet on ship-to-store efforts this holiday season, driven by the increasing importance of mobile for the bricks-and-mortar shopping experience.

In addition to helping marketers bolster foot traffic, ship-to-store is influencing how marketers merchandise in store and offer consumers access to digital tools. Savvy retailers are leveraging mobile to simplify ship-to-store orders and to build loyalty with customers that will hopefully extend after the holidays.

“I think it’s finally here on the ship to store factor particularly with Target making their announcement,” said Lauren Freedman, president of the e-tailing group, Chicago.

“More retailers are making their inventory transparent, so we can only expect in-store pickup to follow suit,” she said.

Happy shoppers
Ship-to-store is an shipping option that lets consumers place orders online and pick them up in nearby stores, with Target as one of the newest retailers to offer the shipping method to shoppers.

As showrooming will likely grow this holiday season, the ship-to-store trend is a response from retailers to catch-up with consumers who are increasingly armed with information about a store and products before actually stepping into the store.

In fact, data from e-tailing group and found that 67 percent of smartphone shoppers have researched store-based information more in the past year. Additionally, 50 percent of shoppers spend at least half of their time researching when intending to buy something locally.

The in-store experience has been one of the biggest focal areas for retailers this year as marketers look to more tightly integrate the physical and digital shopping experiences.

The promise of mobile with these initiatives is aimed at getting consumers to stick around in-store longer to ultimately buy more.

Retailers that have already built up a significant in-store mobile presence this year will benefit from driving online shoppers to physical locations.

Lowe’s and Target are two examples of retailers that have significantly upped their in-store mobile efforts this year.

Lowe’s rolled out an update to its iPhone application in August to include in-store maps that make it easier for consumers to quickly find products (see story).

“Mobile drives the process and makes it more convenient than ever before to reserve, especially knowing who is in an in-stock position,” Ms. Freedman said.

Shopping incentives
Marketers are also turning to ship-to-store to save on shipping costs that can often rack up during the holidays.

Since price comparison is one of the main reasons why consumers choose to shop via their mobile devices, free shipping has traditionally been a focus for retailers to differentiate the holiday shopping experience from others.

Mobile shoppers in particular are fickle over saving money since they are armed with tools to quickly buy an item from a competitor.

The same research from e-tailing group found that 59 percent of smartphone consumers said that they often bought products online but preferred to pick them up in stores to avoid shipping fees.

By eliminating shipping fees for consumers, retailers also cut down on costs by having items sent directly to a store.

At the same time though, online giants are also stepping up their game to better appeal to bricks-and-mortar retailers.

For example, PayPal is teaming up with nine different bricks-and-mortar retailers to offer free two-day shipping for consumers that choose to pay via PayPal (see story).

In particular, apparel retailers have aggressively been pushing ship-to-store as a way for consumers to try on items before they actually receive them.

Nordstrom uses this tactic to bring consumers into stores to help with clienteling.

Consumers can check in-store inventory and buy an item directly from Nordstrom’s Web and mobile site. Once an item is bought, users are then sent an email confirmation and can show an ID in-store to pick up the item.

The ship-to-store trend also indicates that retailers will invest in more mobile services to be used on the sales floor to help cement sales and assist consumers.

“I think it will be interesting to see which aspect of mobile gets used more – consumers shopping on their mobile phones, or store employees using mobile devices to save the sale,” said Nikki Baird, Denver-based managing partner at RSR Research. “For fashion retailers, this could really be a toss-up this year.”

Loyalty-building opportunities
Ship-to-store will also fuel loyalty-building in-store efforts from retailers this holiday season.

For example, promoting in-store offers and deals via SMS not only helps retailers keep in contact up until the sale, but can also be used to build a longer-lasting relationship with consumers.

Similar marketing tactics can be used in getting a consumer to download a mobile app or take advantage of a limited-time offer.

Retailers can also leverage mobile to enhance the in-store experience through personalized recommendations that are based on what items a consumer is shopping for during the holidays.

“I think it will be a big miss if retailers don’t invest in advertising the ‘have the whole chain at your fingertips’ concept to consumers to make them aware of the service,” Ms. Baird said.

“Otherwise, consumers may walk out if a store is out of stock, never knowing they could’ve had it shipped to their home or their home store from another store that had it painlessly and without needing to call around to a dozen stores to find what you’re looking for,” she said.

Final Take
Lauren Johnson is associate reporter on Mobile Commerce Daily, New York