Catch 'Em and Keep 'Em 2011-2016
Revitalizing the Store in a Cross-Channel World Point of View

Internet ubiquity, personal technology adoption and e-commerce growth have produced a new consumer behaviour-cross-channel shopping. In this environment, consumers hop from one channel to another throughout the shopping journey looking for the best deal. For retailers that have achieved success through traditional practices (price, product, promotion and placement), cross-channel shopping demands a new approach to win customers and capture wallet share.

"Think about the online experience today. What [the Internet] does best is compete on price and, depending upon your circumstances, convenience. This doesn't create new value. It [results in] a race to the bottom-the lowest cost and fastest fulfilment."
Ron Johnson
CEO, JCPenney

Specifically, retailers face three critical new challenges:

  • "Catch" consumers as they search for products, prices and shopping ideas
  • "Keep" shoppers connected to your brand as they use various devices (PCs, smartphones, tablets, in-store screens) to bounce between channels (store, online)
  • Entice customers with experiences that trigger them to buy, and buy more

Coined by the Cisco Internet Business Solutions Group (IBSG), "Catch 'Em and Keep 'Em" retailing uncovers a new opportunity- revitalising brick-and-mortar stores through the introduction of web-based content and virtual experiences similar to the ones shoppers (and gamers) increasingly enjoy online. Mashing up the store environment-where shoppers gain immediate gratification from seeing, feeling and smelling retailers' offerings-with the best rich online content creates a compelling experience not possible through either channel by itself.

Cisco Internet Business Solutions Group (IBSG)

Cisco IBSG is not alone in seeing the potential of these solutions to rejuvenate stores. In fact, the December 2011 issue of Harvard Business Review dedicated three articles to this topic.

Over the past two years, Cisco IBSG has studied this new cross-channel shopping behaviour and teamed with several leading retailers worldwide to test consumers' interest in "digital-into-physical" concepts (which Cisco IBSG calls "mashops"). This paper describes Cisco IBSG's most recent findings to help retailers revitalise their stores in a cross-channel world. Our Research Hypotheses

Cisco IBSG's 2011 research built upon a previous study (2010), which found a majority of consumers regularly use the Internet as a shopping tool to obtain lower prices. Most important, that study also revealed that shoppers were very interested in using mashops to help with their buying decisions.

Involving 1,000 U.S. and 1,000 U.K. customers, the 2011 online study was based on the following hypotheses:

  • The most powerful element affecting purchasing behaviour is emotion because it enables and triggers buying decisions.
  • Four key "buying triggers" drive conversions: 1) find (right item, right place, right time, right information), 2) best deal (too good to miss), 3) discover (I have a need, answer it) and 4) inspire (it's a treat and a pleasure). In general, there is less pricing and margin pressure as shoppers move from "find" to "inspire".
  • Retailers can keep more cross-channel shoppers "inside" their brand (and thus capture a higher percentage of transactions) by offering mashop experiences in their stores.
  • At a high level, there is a recipe for creating an effective mashop that ensures the shopping journey leads to you.

Top Five Research Findings

The Cisco IBSG survey queried respondents about their use of technology while shopping, how they engage in cross-channel shopping behaviour and the influence of on- and off-line information sources upon their buying decisions. The survey also asked shoppers about their interest in five mashop concepts currently on the drawing board or in development. Cisco IBSG uncovered five major findings:

1) Shoppers prefer online sources to "real people" in making buying decisions. In the 2010 survey, 60 percent of respondents identified "friends and family" as one of the top three sources of information for making buying decisions, with 21 percent of respondents naming in-store employees as a top-three source. In the 2011 survey, 41 percent of respondents named friends and family, and only 13 percent chose in-store employees as their top-three source of information for making buying decisions.

Please download the PDF to read more.