Mobile Price Checkers Arrive

Discussion
Dec 18, 2009

By Tom Ryan

Pricing Big
Brother has reached the store. According to an Associated Press article,
at least a few tech-savvy shoppers are scanning barcodes with their cell
phone cameras to load into price comparison internet sites while standing
in store aisles.

As an example,
the article noted that Briana Carter, 31, recently found a $40 pink laptop
cooling pad at a Kohl’s in Indiana. After scanning its bar code with her
iPhone and using an application called ShopSavvy, she found the same item
for $25 at Amazon. Ms. Carter bought the pad from Amazon while still inside
Kohl’s.

Mobile opportunities
are increasing amid a proliferation of price-comparison websites with mostly-free
apps to support mobile access, according to the article. Pricegrabber.com’s
new iPhone application also lets shoppers compare prices and buy from websites
anywhere. Similar websites, Pronto.com and dealio.com, are also accessible
through web-enabled cell phones.

The New York Times on Friday reported that one in five shoppers intend to use their cellphones to shop this holiday season, based on an annual survey by Deloitte. Of those, 45 percent plan to use their phone to research prices, 32 percent said they would use it to find coupons or read reviews and 25 percent intend to make purchases from their phones.

The activity
is also growing with the rise of smart phones with go-anywhere web access.
Nielsen Co. predicts that the majority of cell phones in the U.S. will
employ smart phone technology by 2011, up from about 18 percent currently.

At the same
time, the AP article points out that a few shoppers are using their
web-enabled cell phones at stores to download coupons. Sites such as CouponSherpa.com,
Savings.com, Retailmenot.com, Getowza.com and Shopping-bargains.com use
a shopper’s location to find coupons for nearby stores. Customers only
have to show the coupon’s code at the register to get the discount.

Recognizing the trend, more and more retailers
are also listing deals on coupon sites as another way to reach consumers,
according to AP. Savings.com now lists coupons for up to 4,000 retailers,
up from about 1,000 a few years ago.

Kelly Norby,
30, of Vernon Hills, Ill., hunts down savings on her phone across a variety
of categories. If she’s in a supermarket and sees an item she doesn’t have
a coupon for, she logs on to her phone, checks coupontom.com, and downloads
one.

“I’m sort of
giddy about it,” she told the Associated Press, of her e-coupon
finds. “It’s like you’ve won something.”

Discussion
Questions: How serious a challenge to retailer pricing management is
mobile access to price-comparison or coupon-downloading websites? What adjustments
may brick & mortars
have to make before smart phone technology becomes more pervasive?

Please practice The RetailWire Golden Rule when submitting your comments.

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16 Comments on "Mobile Price Checkers Arrive"


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Joan Treistman
Guest
11 years 5 months ago

If savvy consumers are a threat, are there savvy retailers who can meet the challenge? It seems to me that as technology plays a more significant role in buying behavior, retailers have to engage a Chief Technology Officer that will keep them ahead of the curve.

I see an advantage across the board in that consumers who are savvier are proactively searching out opportunities for better value. Retailers who meet this need have to worry less about creating awareness in the usual media. The upside for them in this era of technology-aided shopping can be “build it, and they will come.”

With this push from shoppers, retailers will be turning to the manufacturers to walk in lock step with them. The pressure is on from all sides to all constituencies. Maybe “savvy” is overrated. Maybe it’s just the present and future “business as usual.”

Doron Levy
Guest
Doron Levy
11 years 5 months ago

Here’s the thing. If your prices are not in line or cheaper than your competition, you deserve to lose the sale because of that smartphone. Loblaws is now using tag dots with “We’ve checked the price” on items such as milk, butter, eggs, bread and key seasonal items. No Frills has a huge leader board over the cash with competitor prices on those items.

They key is to build price confidence in your customer before they walk into the store. And if you are confident in your pricing, I would display the barcode on the shelf tag to make it easier for the customer to scan. Embrace the technology, don’t run away from it. Maybe even use it to your marketing advantage. How about a shelf tag that says “Scan ‘n check” with the barcode prominently displayed prompting the customer to check the price online?

Doug Stephens
Guest
Doug Stephens
11 years 5 months ago
The implications for programs like ShopSavvy are significant, particularly as it applies to purchases like the one described in the article. A forty dollar laptop pad is the kind of thing that might not have been aggressively price-compared before. But now with the power to do so at your fingertips, it’s going to become commonplace. As this technology becomes ubiquitous, I see retailers moving to much further development of private-label products across ALL categories. House brands will pop up like crazy in an effort to avoid being directly compared to competitive or national brands. For retailers who aren’t able to develop house brands, I can only see two courses of action. Either set up robust price intelligence systems that monitor competitive prices on sensitive items more aggressively, or simply price-match across the board. Either way, this will force some new behaviors for shoppers and retailers alike. One thing is clear: the days of the old retail strategy of bringing people in the door with loss-leaders only to jack up the price of everything else in… Read more »
Nikki Baird
Guest
Nikki Baird
11 years 5 months ago

I don’t think you have to beat online prices at the shelf, you just have to be reasonably close. $40 at the shelf for something that is $25 online is a huge gap, even after shipping, but there is a real value in having it in front of you, to take home right then and there. Don’t give away the farm trying to compete with online prices–you can indeed still charge for instant gratification.

Paula Rosenblum
Guest
11 years 5 months ago

With or without barcode scanning, price comparisons happen. I actually found myself doing a price comparison in an electronics store myself about 2 weeks ago. All you need is the manufacturer’s SKU…it’s just not that hard.

Retailers have to come to grips with price transparency and engage the customers using those same devices…I don’t think most consumers care if there’s a 2-5% difference in price on small items, so if other value-added offerings can be presented on the smartphone, the customer will stay engaged.

As someone said above, if your price is that out of line, you don’t really deserve to sell it anyway unless you’ve got some service offering associated with the item that makes it worthwhile.

Consumers are pulling retailers to improve their mobile technology offerings. Price is just one piece of the puzzle.

David Dorf
Guest
11 years 5 months ago

ShopSavvy works, but I prefer RedLaser’s barcode reader. I’ve used my iPhone to check prices while shopping in-store–if the price is close, then I’ll buy from the store. But the technology can be used for more than just checking prices. Checking reviews, looking for related items, and finding recipes are all great uses of the barcode search. We’re finally bringing the rich information on the web into the store, which can be both a positive and negative for brick-and-mortar.

Gene Detroyer
Guest
11 years 5 months ago
What is happening with technology and retailing is considerably more than price checking and coupon downloading. This is the fourth time in the last 24-hours I have read or heard about Mrs. Carter’s buying experience. This isn’t a slight human interest story. This is game changing news. It is game changing not because of the irony of standing in Kohl’s and ordering from Amazon but because for her next purchase, Mrs. Carter won’t even go to the store. She will do her pricing at home, buy from Amazon and save the trip entirely. If this was a spontaneous purchase, Amazon thanks Kohl’s very much for Kohl’s investment in store and labor to promote an Amazon sale. And note Mrs. Carter’s age, 31. She brings an entirely new shopping dynamic that retailers are slow to recognize. Retailing no longer means the number of doors. Retailing means reach and availability to a consumer. As I have reported recently, my twenty-something students do not see the retail store as their first stop. They start on line. If a… Read more »
Matt Volpi
Guest
Matt Volpi
11 years 5 months ago

These apps highlight the needs of retailers in certain segments to take control of their in-store experience, including their customers’ mobile experience as well. By offering a retailer-branded app that includes CRM-driven targeted promotions, the retailer can mitigate the loss of customers buying elsewhere for a few dollars less by combining personal, relevant communications and offers with the instant-gratification the customer gets from buying it right then and there.

Ben Sprecher
Guest
Ben Sprecher
11 years 5 months ago
When a shopper is standing in front of a product on the shelf at a store, that store has some inherent advantages over the competitors (bricks-and-mortar or online) connected to a mobile app: 1) Convenience. The shopper does not need to pull out their phone, launch the app, scan the barcode, and make a decision. They don’t need to think at all. They just need to put the product in their cart. 2) Guaranteed stock. If the shopper chooses to visit a different retailer, it’s not certain the product will be there (or be exactly the same). 3) Instant gratification. Sometimes, you just want the book/gadget/cereal *now*. Even the time needed to go one store down in the strip mall can be too much annoyance when a shopper wants to make a purchase. 4) Physical interaction. No matter how good the phone app is, there’s no substitute for smelling the cantaloupe or inspecting the salmon steak. 5) Relationship. If the shopper is in your store, then they have a relationship with you. It may be… Read more »
Gregg London
Guest
Gregg London
11 years 5 months ago

Of interest with these “Mobile Price Checkers” is that the target market seems to be high ticket items, and then only where data feeds exist. Even ShopSavvy, spoken of at length in this article, tells you as much. Amazon has “cut off” access to its API – for more than one of these systems – because of a policy violation (system obtains product data from Amazon, and user purchases from “someone else”).

In the end, the “comparison shopping” concept – widely in use on the Web (and coming to an iPhone near you) – makes sense, but only for a limited number of items, and only for certain shopping purposes.

Per the article, is a $15 price break significant? You bet. Is it worth it to purchase that item from Amazon, pay shipping, and wait several days for it to arrive? That depends on your situation

Cathy Hotka
Guest
11 years 5 months ago

At some point soon, retailers are going to want to put portable receipt printers into stores to allow customers to purchase items from their cellphones in the aisle, and bypass checkout entirely. Younger shoppers are going to think that this is a ‘duh.’

David Livingston
Guest
11 years 5 months ago

On common items retailers are probably not too concerned. On high priced items, many retailers have already taken on the challenge. They require manufacturers to have UPC codes only for their stores in order to preven consumers from doing an apples to apples comparison. That Gateway computer you see in Best Buy might be similar to the one in Wal-Mart but might be only slightly differnt, have a different model number, and certainly a different UPC code.

Mel Kleiman
Guest
11 years 5 months ago

I guess if I say this is something that smart retailers are not only going to learn to live with they will learn to embrace, it will make it 100% from all of the panelists.

Technology strikes again. If all it takes is two clicks and you can compare price, more consumers are going to be buying smart phones. They can now justify the price and the service charges.

The winner is going to be the cell phone company that figures out how to build the feature in the phone so the 65 year old who hates technology can use it and feel comfortable.

Build it and make it easy and they will come.

Herb Sorensen, Ph.D.
Guest
11 years 5 months ago
This is simply part of the inexorable advance toward the merger of online and offline shopping–with the tidal wave of change closer than many think. (Gene Detroyer is right on!) Along the brand-retailer axis the shift could be huge, as retailers will lose control of the mind of their shoppers, control they formerly had as their shoppers came through their door. Meanwhile, the brands have the potential to lock a relationship with the shopper that lives with them, on-the-shopper’s-demand, 24/7, and transcending all stores. Of course the retailer can vie for that relationship, too. But they have lost their ownership of the shopper’s mind, while the shopper is in the store. This means that both brands and retailers are on a more equal footing. Both are at a serious disadvantage to a company that actually knows HOW to sell shoppers online. This may be slightly exaggerated, but neither self-service retailers nor their brand suppliers have really SOLD anything for 100 years. They have built self service emporia, where the shopper does all the selling, to… Read more »
Kai Clarke
Guest
11 years 4 months ago

This article is taking a few examples of technology and trying to apply them across the board. One cannot imagine doing this at a grocery store, and there are so few online shoppers of retail grocers that this is not even a plausible consideration for price sensitivity. This would make sense for high ticket items in the CE category, but most other items are either purchased online or not (who is “checking prices” for a DVD or CD? You either purchase it online or in the store). Our use of mobile phones is increasing, but not to the point where we have to be concerned with mobile price checking becoming a factor in the shopping experience!

Marshall Kay
Guest
Marshall Kay
11 years 4 months ago

The ever increasing levels of price transparency underscores the need for stores to improve the quality of service they offer and use that as a point of differentiation.

In my opinion there are three primary variables that determine whether a consumer is willing to pay the difference between the price in the store and the online price (plus shipping), and they are: 1) the prospect of instant gratification, 2) the quality of the service they receive, and 3) the way being inside that retailer’s store makes that person feel.

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