Shop ‘Till You Drop: Millennials, Email And Showrooming
by Ray Schultz , April 18, 2017
One third of all apparel purchases were made via mobile phones during weekends last December, and the season’s peak shopping day was Sunday. And millennial customers engaged in showrooming, choosing clothes in the store and buying them online.
These are among the findings of a new study by Criteo, based on purchasing patterns it identified among the thousands of retail clients in its network. While the study didn’t focus on email per se, the channel could have been important both before and after the purchases.
“There is no more effective way to build up your customer email database than permission to email shoppers their receipts,” the company advised retailers. “It’s a technique that consumers increasingly expect and can be used to connect offline shopper data sets to online ones for retargeting online based on offline purchasing patterns.”
That aside, two key things came out of this report: showrooming and returns. Only a few years ago, showrooming was viewed as evil. But now it is seen as a normal part of the millennial shopping process, according to Criteo. And that leads to returns.
“More and more apparel is being purchased online,” said John Roswech, EVP of Criteo Brand Solutions. “A lot it is being purchased via mobile devices. But what is really interesting in the return rates—30% to 50%, depending on the retailer.”
That’s a pretty high return rate by traditional mail order standards. But it represents an opportunity for retailers with physical locations.
“If you look at a Macy’s and Hudson Bay, the big traditional retailers, they have a phenomenal asset,” Roswech said.
What is that? Normally, the retailer has to pay the cost of shipping the return back. But if the customer can return the items to the store, that’s a huge cost savings, and “they have an opportunity to sell you in the physical store,” Roswech added.
OK. But why would people buy things only to return them? The answer: They don’t return everything. Let’s say they’re ordering a sports jacket. “If you’re a 44 regular, it may all fit differently,” Roswech continued. “So you order the 42, the 44 and the 46.”
The downside is that the retailer has three jackets that are out of play.
The upside: there is no return shipping cost, and the customer may buy something else when they bring back the two unwanted jackets.
The smart retailers are “moving seamlessly between those environments,” Roswech observed. They are embracing technological innovations, such as eBay’s Magic Mirrors. But Roswech added this caveat: “When you walk into Macy’s, you have all these clothes and items on view: hundreds of pairs of jeans, variations and different colors. Now, on a 3 ½ inch screen on your mobile phone, you can now can see only three or four items at a time.”
The result is that retailers must be at the top of the queue for these products on the search engines.
What role does email play in this environment? Retailers are “trying to personalize what you watch, and use algorithms to tailor everything to you,” Roswech said. “You can capture a lot through email. Most people that shop at the major retailers are signing in, so the retailers have their emails captured.”
Roswech added that “most retailers are asking for your email address even in store and starting to email you the receipt.”
In the end, stores will know that you browsed online today for a jacket, and went into the store to purchase it two weeks from now. But that requires “bespoke” information—tailored to the individual.
Roswech made it clear that he was talking about large retailers like Macy’s, Target, Kohl’s and Walmart.
Criteo is advising retailers to “embrace the new ‘always-on’ retail paradigm, where seasonality plays less of a role and in-store and online technology innovation enhances the shopper experience.”
The Criteo study also reported:
- The average cart size hit a peak for the season of $126 on Sunday, Nov. 13.
- There are more than three products in every shopping cart. The carts in this category each averaged $95.21 during the third quarter of last year.