Mobile is building loyalty rather than sales

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By: Wise Marketer Staff |

Posted on July 11, 2013

As the mobile channel continues to change the way consumers interact with their favourite brands and retailers, ecommerce experts are finding that the biggest return on mobile today is from increased customer loyalty and personalisation, rather than mobile transactions, according to a survey of retailers by EPiServer at the Internet Retailer Conference & Exhibition 2013.

The survey found that 46% of retailers that already have a mobile strategy in place - and 74% of retailers that are planning to implement a mobile strategy in the coming year - are using mobile primarily to increase customer loyalty or to provide a more personalised experience for their customers.

Of the more than 100 organisations surveyed, only 22% said that mobile transactions accounted for more than 20% of their sales. Although that number is up from 16% in 2012, in a similar survey EPiServer conducted at the same conference one year earlier, the research suggests that, unless you're a major player (for example, Amazon or eBay), mobile transactions are simply not the primary driver of ROI from a mobile strategy.

Even among pure-play web merchants with a mobile strategy in place, 60% said mobile transactions accounts for less 20% of their sales, with the remaining 40% indicating that mobile commerce made up only between 20% and 40% of sales. To that end, only 8% of those surveyed said they use their mobile strategy for sales, compared to the 46% that use it for customer loyalty and personalisation.

"We call it the 'Amazon effect'," said Bob Egner, vice president of product management for EPiServer. "As e-commerce powerhouses such as Amazon and eBay make it increasingly difficult to compete on price, retailers are using mobile as a way to differentiate themselves through convenience and brand loyalty. We see that retailers are still not completely sold on the ROI of a mobile strategy that focuses on mobile transactions."

In fact, retailers are realising a higher return and an increase in repeat business when they provide their customers with a positive experience that fosters loyalty and convenience, rather than building out a complex transaction model.

The survey also found that, in the next three to five years, 60% of respondents plan to make the greatest investment in their website, up 1% from 2012. Some 35% of respondents indicated that their greatest investment will be in mobile, up 11% from 2012, and 5% said their social strategy will be their greatest investment, down 17% from 2012.

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