Thanks for all the comments on the post on banks being injured by the rise of mobile phones. They won't be the only ones. Retail stores are already beginning to feel the pinch. I now make no major purchase without Googling the product in the store to see what its price is online.
In the really old days (you know, more than 10 years ago) retail stores made their profit by taking advantage of the lack of information in the market. You didn't know whether you were paying a good price for your new tape deck or Walkman. You went to the closest location that sold that product and almost certainly bought it there.
In the only slightly old days, internet and home computers allowed us to find other options for information on products we wanted to purchase (via Amazon or Google or similar services.) Now, retails stores make their profits by offering immediate gratification and by guessing that most people wouldn't run home to their internet connections to check for better prices. The latter advantage is gone.
In the last two weeks, I've tested the sales staff at both Fry's and Best Buy. In both cases, they will honor a cheaper online price that I found from my iPhone using nothing more sophisticated than a Google search. In other words, I got immediate gratification AND a cheap price (in both cases, it was about 10% less online.)
I don't know how these stores are going to change their business models, but the current approach seems doomed to obscurity.
Happy Anniversary, Green Shoots
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One year ago, on 60 Minutes, Ben Bernanke uttered that now famous phrase.
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1 comments:
Jim, my take is that mobile could potentially augment Retail based on how it is positioned. LBS (Location Based Services) have started slowly gaining traction and what they provide is targeted campaigning in real time. Say you are driving by Fry's, and Fry's could push coupons and other offers in real-time to your mobile device which may entice you into the store for an impulse buy. Even basic Store Locator functions on a mobile application help drive Store traffic. We recently took a long road trip and thanks to my mobile device, I could figure out where is the next closest Starbucks for my Tall Dry Cappuccino fix! Also, it is imperative that Retailers realize that mobile device is a powerful portable computing platform using which they can deliver valuable information to their customers and drive incremental sales. Native applications running on mobile devices, if designed and constructed properly, will help Retail customers discover products in the Stores easily and make purchase decisions effectively. I have no data to prove but I believe that Mobile/Mobile applications bridge the gap between B&M Stores and online thereby increasing cross channel activities of customers.
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