The tech-savvy consumer and retail apps: A win-win

Technology Writer

When today's tech-savvy consumer utilizes retail apps on their mobile device, that person is generating a tremendous cache of data about their in-store, out-of-store and online behavior. Retailers can use this information to entice consumers with targeted features such as coupons, special deals and comparison shopping tools. In turn, shoppers receive discounts and reminders about items they might be likely to purchase in the future. apps really a win-win?

It sounds like a mutually beneficial arrangement and, for the most part, it is. Some retailers are capitalizing on schemes that were already working, such as loyalty programs, and adding an app component. In June, according to Fast Casual, sandwich chain Capriotti's introduced a rewards app that lets customers earn points and rewards for ordering. To encourage retail customers to download, Capriotti's also offered patrons $2 vouchers toward their next meal at the restaurant.

While few are delving into apps with loyalty program components, retailers that have had success with apps have provided other lures for shoppers. A Xtreme Labs survey, as reported by Forbes, found that Walgreens and CVS had the best-reviewed retailer applications on iOS and Android, respectively. Both applications let users fill prescriptions, place orders for in-store pickup and find deals on products. For retailers, a killer utility drives a killer app. One prime trait is the omnichannel experience: The tech-savvy consumer can check to see if a particular item is in stock, then head to a local store to purchase it.

On the retailer's side, apps can be a great source of customer data. When a user signs up, that person can opt in to share shopping data with the store. By getting customers in the habit of using apps, retailers can glean new insights on a customer's tastes and preferences. This form of analytics is still in its early days, but some retailers are already seeing patterns that can inform how they tailor offers. For example, research from IDC and Onavo revealed that while retailer app use stays steady during the week, shoppers tend to employ different comparison apps on the weekends. That's an indication that consumers are examining products before they buy, a practice also known as showrooming. Customers tend to make actual purchases on Sunday and Monday, according to the report.

Adding to existing data

Well before the advent of smartphones, many retailers were adept at gathering data on consumers. For years, Target has assigned every shopper who walks into its stores a guest identification number that records everything they buy, according to The New York Times Magazine. Apps add a new layer of information, telling the retailer what individual shoppers buy, what they like and where they live.

One emerging use of data is to send shoppers personalized offers when they're in or near a store. Retailers are already taking advantage of this option. As Marketing Land reports, retailers sent 34 percent more push notifications during the 2014 holiday season than the same period in 2013.

Bridging online and offline

While personalized offers have been hyped for some time, an even more exciting development for retailers is the ability to bridge online and offline data. Another Marketing Land article reports that Walmart's new Savings Catcher app, which refunds consumers when they find a cheaper deal on a product sold nearby, also lets consumers search and buy from

That could serve as an effective hedge against showrooming and can also change consumers' habits. Instead of going to Amazon immediately, they might first check their local retailer for the item through an application. If it's in stock, omnichannel functionality can allow shoppers to buy from that store instead. While it's tough to compete against Amazon Prime's free shipping, if retailers can at least propel themselves into a consumer's decision-making process, they will have made huge strides.

Need a strategy to capitalize upon your online and offline data? Connect with analytics professionals via our IBM Retail Industry Solutions Page.