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John Lewis, Argos and the mobile path to purchase

The figures speak for themselves; with recent IMRG-Capgemini data showing that mobile devices – smartphones and tablets – accounted for 23% of all UK retail sales in the second quarter of 2013.

It has become clear that all retailers should be embracing this channel, as smartphone adoption continues apace. Telecom vendor Ericsson said this week that smartphone subscriptions will hit 5.6 billion by 2019, but there is still some work to do before the majority of retailers can boast of mCommerce operations that align seamlessly with all other parts of their respective businesses.

Department store chain John Lewis and multichannel retailer Argos are two companies that were quick to capitalise on consumers' growing propensity to use the mobile in the purchase process, and this week they both offered an insight into how they have been successful in this retail channel, which appears to be growing in importance month by month.

Talking at the Mobile Marketing Association (MMA) London forum on Tuesday, Argos strategic development manager Ben Murr said that the advent of mobile as a sales channel allowed the business to make the most of its unique selling point, namely its extensive catalogue of products and its vast network of stores spread across the UK.

Live stock information is delivered to product pages on the mobile site, while local store details are provided and customers are encouraged to reserve items online and collect in-store, thus joining up all parts of the business.

Murr commented: "You need to align and develop all channels together, but use mobile to differentiate – it can do things other channels cannot.

"I see that some of the leading retailers don't have a mobile-optimised site and this is frankly embarrassing bearing in mind how important mobile is now – hopefully that'll change soon."

John Lewis development manager Tim Linsell, who was also one of the headline speakers at the MMA event, added that mobile retail is now considered in every business decision the company makes.

"We're continuing to invest in the mobile site and the app, but what we're really excited about is how we bring in-store shoppers online [and vice versa]," he explained.

He cited the recent growth of the retailer's click & collect operation, which he says has not only saved the business money in delivery costs, but has also apparently made its customers' lives easier.

A number of the new mobile strategies John Lewis is currently investigating, which includes the capability for consumers to build up a shopping basket on mobile before paying at a till in-store, are being undertaken with consumer satisfaction in mind. "The success comes because it's more convenient for the customer and improves their experience," Linsell added.

Some of the statistics back up the companies' respective investment in mobile, with Argos now reporting six million app downloads since it launched its first one in 2010, and mobile devices now accounting for 16% of total sales. John Lewis, meanwhile, says that 42% of online traffic is driven by mobile and this year it has seen a 115% year-on-year increase in sales through tablets.

Both retailers' mobile journeys started back in 2010, when smartphone devices really started penetrating the overall mobile market. Like other retailers, such as Marks & Spencer, which was one of the first of the larger businesses in the sector to launch a mobile-specific website, Argos and John Lewis had to react quickly to consumers visiting their online sites through a new avenue.

Murr said that Argos received a 600% year-on-year increase in the number of visitors via mobile in 2010, which prompted the launch of a mobile app and then a site optimised for mobile devices. Meanwhile, in October of that year John Lewis also took a mobile-optimised site to market after experiencing similar trends.

Talking to Essential Retail, Murr said that he now believes that the launch of a mobile-optimised site should typically precede the unveiling of a mobile app because the latter is more of a tool for loyal customers, but the former allows companies to pick up new business more efficiently.

There are no regrets though, he added, describing 2010 as the year "mobile suddenly exploded", meaning the retailer had to ensure it could facilitate transactions via mobile devices as quickly as possible.

Retailers will be aware that the constant advancement of technology means that consumer habits are continually changing, and this is no different when it comes to mobile. Both Argos and John Lewis have had to amend their mCommerce capabilities over the last three years to meet the requirements of new operating systems, new devices and to cater for the shoppers' desire to browse and locate as much information about products and retailers as they can.

"Mobile needs constant love, and needs to be continually driven forward," explained Murr, while Linsell acknowledged that the John Lewis mobile site and app took a dip in performance levels because "the investment wasn't put in" as consumer requirements changed.

As of July, the department store chain has had a fully transactional app that takes customers through the whole shopping cycle, from initial browsing to payment and purchase, which was a move fuelled by customer feedback.

And therein lays the core aspect of everything a retailer does: the customer. The MMA's EMEA managing director Paul Berney, who in a recent big interview with Essential Retail said that retailers are currently playing catch-up with consumers' mobile habits, believes that a key part of the mCommerce success achieved by Argos can be attributed to its attitude to the shopper.

"With Argos, the focus is all on the customer, not the technology – and they think about the role of mobile in every part of the journey," he remarked.

"I expect retailers need to understand what mobility means to their consumers, rather than what people are actually doing with their mobile phones."

The MMA is an association partner of RBTE 2014.

http://www.mmaglobal.com/region/emea