Mobile Pays Off With Customer Loyalty, Not Transactions

The biggest return on mobile today for retailers is not transactions, but increased customer loyalty and personalization, according to a study by EpiServer.

EpiServer surveyed retailers at the recent Internet Retailer Conference & Exhibition (IRCE 2013), and found that 46% of retailers who already have a mobile strategy in place and 74% of retailers who are planning to implement a mobile strategy in the coming year use mobile primarily to increase customer loyalty and/or to provide a more personalized experience for consumers.

Of the more than 100 organizations surveyed, only 22% said that mobile transactions accounted for more than 20% of their sales. The research suggests that, unless it involves larger online companies like Amazon or eBay, mobile transactions aren't the primary driver of ROI stemming from mobile strategies.

For pure-play web merchants with a mobile strategy in place, a staggering 60% said mobile transactions account for less than 20% of their sales, with the remaining 40% indicating that mobile commerce made up only between 20% and 40% of sales.

Only 8% of retailers surveyed indicated they use their mobile strategy for sales, compared to the 46% that use it for customer loyalty and personalization. 

"We call it the 'Amazon effect,'" Bob Egner, Vice President of Product Management at EpiServer, said in a press release. "As ecommerce powerhouses like Amazon and eBay make it increasingly difficult to compete on price, retailers are using mobile as a way to differentiate themselves through convenience and brand loyalty. We see that retailers are still not completely sold on the ROI of a mobile strategy that focuses on mobile transactions.”

Egner added that retailers are realizing a higher return and an increase in repeat business when they provide their customers with a positive experience that promotes loyalty and convenience, as opposed to when they build out a complex transaction model.

According to the survey, in the next three to five years, 60% of respondents plan to make the greatest investment in their websites -- up 1% from 2012; 35% indicated that their greatest investment will be in mobile, up 11% from 2012; and 5% said social strategies will be their greatest investment, down 17% from 2012.

EPiServer conducted a survey of CEOs, Vice Presidents, Directors and e-commerce Managers at more than 100 organizations including retailers, manufacturers, wholesalers, catalogers, web-only merchants and local retailers.

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