SAN JOSE, Calif — SAN JOSE, Calif. – For a growing number of shoppers this holiday season, the difference between offline and online will be no line at all.
With an avalanche of new smart phone apps just in time for Black Friday, these handheld shopping tools are redefining the art of consumption, blurring the distinction between the in-store experience and the virtual world of information now available in the palm of your hand. Advances in location-based technology, bar-code scanning, price-comparison apps and social-networking tools have turned the mobile device into a sweaty-palmed third channel of commerce, empowering consumers while challenging retailers to rethink the way they do business.
“The future of online is offline,” said Cyriac Roeding, co-founder and CEO of Shopkick, a popular shopping app. “These apps are encouraging people to interact in brand new ways with products and with the store itself, fundamentally changing the shopping experience.”
The appetite for new apps seems voracious. A recent survey by comparison-shopping site PriceGrabber revealed that 36 percent of consumers plan to use their mobile phones for shopping-related activities this holiday season. Recession-wary consumers are embracing new tools that can instantly call up product specs, reviews, price comparisons and input from Facebook friends and Twitter followers, all while they’re standing in the aisle. And Manish Rathi, with the consumer electronics shopping site Retrevo, says its surveys show that consumers using cell phones to make purchases jumped among respondents from 10 percent in February to 20 percent in June.
“We think mobile purchasing has arrived, and it’s evolving quickly,” Rathi said. “People who walk into your store now are no longer comparing you to the next brick-and-mortar site but to everything else offline and on. Shoppers are shopping and comparing prices on a global level.”
Even for those already using their iPhones and Droids as digital tool kits, some of the new apps are downright mesmerizing as they twist and bend the way we shop.
One mapping app helps you find a product in a mall and takes you to it with a virtual escort leading the way. Another locates your car in the parking lot, thanks to the photo you’d taken of it and the GPS that locked its location into your phone. One app rewards you with a discount for stepping into a particular store, while another coaxes you to a dollar-off discount for a product in the back-row Siberia of a big-box retailer.
“We call it a virtual end-cap,” said CEO Mark DiPaola of CheckPoints, referring to the shelves at the end of an aisle. His app earns you rewards simply for scanning bar codes on certain items. “Even though the product may be way in the back, we feature it in your phone and make it feel like it’s right up front when you walk in to the store. At the same time, we’re making money by driving tens of thousands of users to these products, breeding new customers for the manufacturer.”
With thousands of third-party shopping applications available for the iPhone – and Android and BlackBerry trying to catch up – these mobile magic tricks are presenting retailers with challenges along with benefits. If a customer can now instantly compare your price to thousands of others, and if a user’s 200 closest Facebook friends can weigh in on that pair of shoes you’re trying to sell her, the technology prompts a question: As apps continue to blur the online-offline wall, what will the store of the future look like?
Anne Zybowski, an analyst at Kantar Retail, says that a few years ago “retailers spent a ton of time trying to make their online stores look and act like their physical stores. Now they’ve sort of reversed course, and the challenge is how to take that online shopping experience that’s so personalized, socially connected and heavily layered with data, and essentially bring it into a physical environment.”
Major retailers like Target are experimenting with on-site “glorified kiosks where they take the online product information and reviews and bring them to life in the store,” Zybowski said.
“Europe is ahead of us,” she said, “with pure online retailers who have started to open up small 3,000-square-foot stores that essentially enable you to pick up stuff you’ve ordered online, or place an online order with a clerk’s assistance.”
As she wandered around a Palo Alto, Calif., shopping center last week with her daughter, Katie, and 3-year-old granddaughter, Samantha, toting an app-laden iPhone in her hand, retired school administrator Karen Wolff was the picture of the line-blurring, digitally savvy smart-phone shopper. She brought up a price-comparison app, then a bar-code-scanning app, then a Facebook app and another for MapQuest.
Finally, she pulled out her favorite app of all: the camera built into her phone.
“If I see a cute T-shirt for my granddaughter, but want to make sure her mom thinks she’ll like it, I’ll take a picture of it and e-mail it to her for her approval,” said Wolff. “It makes shopping truly collaborative. I know I’ve got Katie’s approval before buying it, so I’ve eliminated the return part of the shopping process.”