Retail TouchPoints: Macy’s, Target Tap QR Codes for Extended Customer Interaction
Through a special arrangement, presented here for discussion
is a summary of a current article from the Retail TouchPoints website.
The
fascination around mobile for retail started with mobile marketing and the
ability to communicate via SMS text messaging, and very soon graduated to mobile
commerce. Now Quick Response (QR) code scanning is giving retailers, including
Macy’s, Target and Best Buy, a competitive edge.
QR codes present a unique
value proposition for retailers, as they are an open-source and freely licensed
standard. The ability to provide consumers with a digital supplement to printed
materials that can be scanned via free readers offers retailers yet another
touch point through which to leverage smartphone technology.
The following
are few examples:
- In late February, Macy’s launched a new service, Macy’s Backstage Pass,
to bring exclusive video content to users’ mobile phones through QR code
and SMS technology. After launching the QR reader application on their smartphone,
users scan any Macy’s Backstage Pass red star-shaped code found in various
departments throughout the store and the code will deliver the video content
to their hand-held device. Macy’s Backstage Pass codes now offer 30-second
films to users’ mobile phones that provide fashion inspiration, advice and
tips. Following the initial video feature, users also have the option to
select longer-length content that will take them further ‘backstage’ with
each designer or brand.
- Shoppers at CVS and Walgreens, among many other stores, are now able to
use their smartphones to scan Microsoft Tag 2D barcodes on Herbal Essences
products. Scanning the barcodes on shelf talkers, shoppers are redirected
to a mobile landing page where they can view Herbal Essences products, take
quizzes and learn how they can achieve a certain hair style. They can also
read customer reviews.
- Target is seizing the opportunity to integrate QR codes into its print
advertising. By using the ScanLife scanner application, readers can scan
the code and are taken to a video featuring stylist expert Sabrina Soto,
who shares information and tips on how to use Target furnishings and products
from home décor.
- Best Buy became the first national retailer in the U.S. to embrace the
trend in September 2010. Scanning the QR code on items in stores, Best Buy
shoppers can view and compare key product features more visually, as well
as access reviews and email product information to friends.
“At their core, QR Codes are a link to online content,” said Jeff
Weidauer, VP of marketing and strategy, Vestcom, a data management and programming
resources technology proprietor. “Shoppers want to know more about the
products they buy, and offering information at the shelf edge via QR Codes
is a great way to provide that additional information.”
Discussion Questions
Discussion Questions: What do you think of the potential of QR code scanners as an in-store customer engagement tool? Will the technology have an even bigger effect on traditional media (TV, print, circulars, etc.)?
It would be interesting to find out how many smartphone owners have downloaded scanning apps…I’m guessing it’s a high percentage and growing fast. Smart retailers will exploit this technology as a way to drive sales, instead of being afraid of the “competitive price-checking” empowerment of the consumer. QR technology can give retailers the ability to deliver product knowledge and micro-targeted offers to the consumer with a smartphone in her hand, as well as a deeper understanding of which products are drawing the shopper’s attention in the first place.
If I’m in a CVS and in the hair care aisle, am I going to take the time to watch a styling video on my smartphone?
I have a little trouble imagining it.
On the other hand, does this technology hold some promise?
Absolutely!
There is a measurable lag between the time we discover what we CAN do with a retail technology and the time we figure out what we SHOULD do with it. This is no exception.
Trial and error will tell us what mobile phone-accessed information moves the sales needle and what does not and my bet is that it will be sorted out in quick order.
I’m going to go on record and say that QR codes are going to be the 3-D TV of the retail world–cool idea that nobody really cares about. Part of the problem is that it’s a cumbersome process in most cases. First download the scanning app, then scan the code–maybe scan it twice if you screw it up the first time, then wait for the URL to open (if you have decent connectivity) and then check out the content, which is often a disappointment–partly because you’ve waited so long to see it!
I think QR is just a holding point on the way to augmented reality.
QR code holds great potential for retail. Right now, it would probably work best for retailers serving the “digital generation” (such as Hot Topic, Abercrombie & Fitch), but keep in mind that anyone who was born from the late 1980s and on has basically been living in the digital world their entire lives. Much like happened with cars, phones and TV, digital technology is quickly shifting from revolutionary to ordinary. In 10 years not only will QR codes be routine, they will probably already be obsolete.
I have a hard time believing that time-pressed consumers are going to take the time to download an app and then view video content while in-store. They are more likely to do this while looking at an ad. Over the years a number of devices have offered to connect consumers to more information about products. Nary a one caught on.
Retailers need to give their customers access where and when they want it and QR technology is perfect for that. Instead of being fearful that their customers will be using those QR codes to find out who’s got a product cheaper, they should be linking their marketing and loyalty programs to their mobile strategy. The more a customer engages with a retailer the better, no matter how. Being there and providing the mobile customer with more than just a coupon can be a powerful sales, customer service, and loyalty building tool. Bottom line, if you aren’t giving your customer what they want and how they want it, someone else will.
It seems to me that, just like RFID, there is a need to phase in QR codes. This could be done by using them to link workers to additional information posted on the retailer’s intranet. Instructions for everything from weekly promotion campaigns to the maintenance of store processing equipment could be referenced by QR codes posted in ad flyers or on the side of equipment.
Internal use would introduce QR codes to the real-world environment while limiting the number of reading devices required. 80 percent of wireless phone sales are still “full feature” phones verses smart phones. Many consumers are avoiding the higher cost data plans required by smart phones. Who knows when pricing will converge to the point where the two types of devices are financially equivalent?
Consumer oriented QR implementations that require use of a smart phone will be challenged until there is less of a cost difference and more people own them.
This is just another example of how the retail landscape is rapidly changing. Being able to provide this value-add whether on a TV, a bottle of wine, or locally sourced food product will be important to some customers, so being out there testing what works and for whom is a great step for retailers to take.
It is very interesting how digital is impacting bricks and mortar retail. Apps or devices in the hands of customers have the potential to dramatically shift the access to the shopper and their data. The whole model and balance of power across this space from manufacturer, to retailer, to phone provider, to app/loyalty device is under pressure from new forces enabled by “digital.”
Exciting times indeed!
QR codes are a promising way for retailers and manufacturers to add digital to in-store. So far, they are only a modest success.
Retailers and manufacturers can engage shoppers. Because the content is largely server-based, they can change it in real-time. Retailers can gather usage data such as which codes get scanned by whom and when.
Further, retailers can integrate shopper loyalty card history, as Jeff Weidauer notes. Marketers can offer not just information but e-coupons, exclusive benefits, and purchases from the shelf. Optimists see upside from the <2% of total US scans from retailers and the success in Japan.
But there are adoption barriers. While QR codes are most common, Microsoft Tag, EZcode, and JagTag are promoting competing standards. Most mobile users need to actively download readers, as Doug points out.
Notably, repeat rate is low. Monthly scans increased 1200% from Jul-Dec 2010 (Mobioid). But this was during the holidays, after all. Fully 90% of consumers scanned 5 or fewer barcodes from any source in those 6 months, which is a low repeat rate even after adjusting for customers starting mid-period.
Worth buying an option, but not tearing up the in-store marketing playbook.
QR codes are part of broader wave of technology that will bring information to the consumer at the shelf’s edge (and plenty of other places in the case of the smartphone). The key here is applying it in ways during the shopping journey that improves the shopping experience. I don’t mean that to sound overly simplistic but I agree with Ryan…who is stopping to watch video while shopping their local drug store? Cool technology does not stick around without some measure of practicality/value to the consumer (even for the Millennials). The wave of more, better, and faster info in the hands of the consumer, wherever and whenever they want it, is solid. QR codes are one technology element, not to be confused with the overall trend.
I get a headache just thinking about shopping in this way. Sorry–still not feeling the love.
I like QR codes in retailer magazines and circulars better than in the store. Let the consumer decide when and where they have time to scan them and watch the video, see the longer story or get the recipe. Typically that is going to happen more often at home than in the stores. Lowe’s is doing a good job of this in their monthly Creative Ideas magazine. Bed, Bath & Beyond is also doing this well in their custom circular.
My thoughts on QR codes are this; the are still new, and we haven’t perfected the use but like playing a sport, it takes practice to get better at it.
What I think we need to consider in retail is that it doesn’t just have to be about products. Say you are in a mall; you can use a store locator attached to the QR code, or maybe it’s on a receipt that gives a 10% off code when they scan it and shop on their phone. There are so many ways to utilize the QR codes that I think they will pass through being a fad and into being commonplace.
As we look at the Japanese, who tend to lead the Americans in cell technologies, almost all of their phones have built-in scanners. No need to download apps! And when that becomes commonplace here in America, I think we will see a surge in the use of them.
Another great thing to think about is the measurability of the codes. You can test codes left and right and measure the usages and decide which types of ads are working best or even what content engages users more.
There is a lot to be said for the potential of the QR code.
This may sound cynical, but scanning QR codes and viewing the resultant media may be too much time and effort for all but the most committed shopper-geeks.
Just because a thing works, doesn’t mean it gains widespread adoption. And just because relationship marketers love the trackable data trail that comes with scannable codes, doesn’t mean they will be used widely and consistently by shoppers.
In the end we must ask ourselves how each media innovation affects the shopping experience. Will they stop and watch a 30-second message about each purchase? Maybe for a high-consideration item, but not likely for trip missions that involve consumables.
I love QR codes embedded in print ads, or on in-store signs where shoppers can instantly acquire a coupon or join a frequent shopper club. But this has abuse potential in the form of content overload. Seller beware.
If the information is compelling, it will be accessed outside of the store. Perhaps other than tech products and automobiles, who is going to stop in an aisle and watch a video?
If this is truly a valuable tool, can we imagine aisles clogged with people watching videos on their smart phones while shoppers try to get by them or get to the shelves to buy products?
More than just a marketing or information tool, QR codes have the potential to be used for more practical applications in Supply Chains.
What if a customer scanned a QR code that was tied to a retailer’s inventory data? For example, a customer enters Best Buy and they want to purchase a 50 inch LCD TV. The store they are in has 3 in stock, but the store 10 miles away had over 40 in stock. It would benefit Best Buy to encourage the customer to drive the 10 miles to pick up their TV. They could achieve this buy offering them a savings that is good for a certain period of time incentivizing them to drive to their other location to purchase the item. In fact, they may also receive an invitation to share the coupon with 10 friends. I call this Customer Driven Supply Chain (CDSC). You can use customers to help balance inventory across several locations. Same can be done at Macy’s. If a customer wants a size 10, but that store does not have it, the QR code could allow them to order the item to be shipped to their house for free or at the very least let them know where there is a size 10 and provide them a discount to drive to that location to pick it up. Not only does this help the retailer satisfy their customers and avoid out of stocks, but the manufactures benefit from less returns.
Customer Driven Supply Chain is a huge opportunity for retailers and manufacturers alike. I can only assume this type of solution will be available in the next 12 to 18 months.
In an earlier discussion we spoke to men being buyers and not shoppers. How many men can you imagine downloading an app in a store to look at a video on whatever the product might be? My guess is somewhere between few and none. But what do I know? I have not been able to pick the correct six lottery numbers either.
Interesting that the subject of QR codes came up this week as it was on my mind as well. I posted QR Codes Create Digital Curiosity on my Loyalty Truth blog and the article here as well as comments from panelists reinforces my feelings that there is great potential in QR codes for retail.
I have seen QR codes used increasingly in print media as well. This morning’s sports page in the Fort Lauderdale Sun Sentinel had a QR code with this title: Maria Sharapova photo gallery. I’ll bet that had some tennis fans searching for a code reader on their smartphone!
Seriously, QR codes do have potential and, to me, allows retailers to extend their hours and engage customers even when they are window shopping outside of normal hours.
As they say, technology enables, but imagination wins. So it is with QR codes.
Certainly there is potential. Figuring out which consumers regularly use this technology as a source of information rather than a curiosity is important. Figuring out what they want to learn and when is important. Experimentation is necessary to answer these questions. Who knows where this technology will go or what might be the useful application that we can not live without?
Be careful of the monolithic “customer” view. Different categories, different segments and different mindsets is the norm.
Retailers that relevantly differentiate their shopping experience to the above shoppers might thwart the other burgeoning use of smart phones: couponing.
The consumer is already in the store, standing in front of a variety of product choices, and then asked to view a commercial? (aka video content) Maybe a few seconds for a special offer or a discount at POP but even that costs the consumer more time, confuses with options, and delays the choice–maybe to no purchase. And at home, if the consumer chooses to participate in the archaic process of reading a paper, and is then asked to grab the smart phone and scan the code…all a bit much to ask. Using the technology in this way provides some novelty that may move some consumers to utilize it but that novelty will soon pass. This looks like a solution looking for a problem and that is generally not the way technology provides value.
The Home Depot is at it too. Content must be relevant as in any other context and contact.
I agree with the post that QR codes are better suited for magazines and circulars rather than in the store. But it also depends on the store. Home Depot and Bed, Bath & Beyond are better suited for this type of promotion than a grocery store because shoppers want to get in and out quickly.
Applaud them for taking some risks. But let it be known that this is the moment QR codes “jumped the shark.” Put ’em everywhere, with limited consumer value! Great idea….
Listen, QR codes makes sense only if there is value added content–THAT IS RELEVANT FOR A MOBILE DEVICE. Do you want to watch a “how to” video on your phone? Or a fashion show? Nope. Maybe read reviews. Maybe find product specs. But to think folks are going to sit at home, snap a QR code and watch droll video while their laptop or tablet sits on the table nearby is foolhardy. Once again, marketers chasing a shiny object with agencies peddling them.
QR codes are in their infancy. Time will tell if that particular technology catches on or if something “quicker” comes along that is even less cumbersome. Retailers and manufacturers need to also be quick to respond with compelling content at the other end of a scanned code. Once a shopper gets to the site, if the content isn’t compelling, then it ends up be wasted time for the shopper and they are more annoyed than if they hadn’t scanned the code in the first place.