eMarketer Webinar: The Changing Path to Purchase—What It Means to Add Mobile to the Mix

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The Changing Path to Purchase:

What It Means to Add Mobile to the Mix

Krista Garcia

Analyst

August 25, 2016


The traditional purchase funnel

A remnant from when print and TV ads

ruled


The current shape of things


7:53am:

Smartphone

email at

home


10:30am:

Desktop at

work


11:44pm:

Tablet in

bed



Mobile in the Mix


What’s changing?

“Mobile, combined with the ability to leverage location

for a more relevant and tailored experience, has

changed consumer expectations when it comes to

purchases. The personal and on-the-go nature of

mobile, the convergence of online and offline, and the

increased expectations for consumers to have what they

want delivered to them immediately has fundamentally

disrupted the path to purchase.”

—Sarah Ohle, senior director, global research, xAd


39.1%

17.0%

0%

25%

50%

2016 2017 2018 2019

The double-digit growth in retail

mcommerce is a byproduct of

there being more mobile

shoppers and consumers

growing more comfortable with

shopping on the go.

Retail mcommerce sales will experience

rapid, double-digit growth

Three key factors are making it

easier for consumers to buy

products on mobile devices:

1. Large-screen smartphones

2. Android Pay and Apple Pay

3. Better optimizationUS Retail Mcommerce Sales (YOY growth %)

US Retail Mcommerce Sales (billions)

$123.13

$208.58

2016 2017 2018 2019


84.0% 86.0%

44.5% 46.2%

35.5% 35.3%

19.0%

27.0%

0%

100%

2016 2017 2018

Eight out of 10 US smartphone users shop on

their phone, but less than half buy something

Shoppers

Buyers

App buyers

Proximity mobile

payment users

Less than one half of US

smartphone users will buy

products or apps through

their phone.

Roughly a quarter will use their

phone to pay for a product or

service in a store (a proximity

mobile payment).

Activities Conducted by US Smartphone Users

(% of smartphone users)


90.5% 91.4%

70.0% 71.0%

43.6% 43.3%

0%

50%

100%

2016 2017 2018

Shopping and buying are the most popular

activities among US tablet users

More than two-thirds of all US tablet users will regularly make a retail purchase on their device.

Almost half of US tablet users will buy apps for their device.

Activities Conducted by US Tablet Users Ages 14+ (% of tablet users )

Tablet shoppers

Tablet buyers

Tablet app buyers

Nearly all US tablet users shop with those devices.


Mobile matters even if it’s not the last touchpoint

“Mobile may not be the

finisher of a sale, but

it’s an assist. It’s in the

middle of that cycle,

and you need to be

there.”

—Jeff Campbell, Co-

Founder and Managing

Director, Resolution Media

“We've seen a large number

of customers who research

products on the phone, in

the app and on the site, but

they ultimately visit the store

to complete the

transaction.”

—Kartik Subramanian, Director,

Product Management and

Mobile Commerce, Walgreens


Research (and Amazon’s role)


Digital influences all channels

82%

of US internet users

research products

online before going into

a store

(Source: Salesforce, Oct. 2015)


Amazon is

the start of

many

shopping

journeys


Why Amazon?

Mobile is an

opportunity for

retailers


Amazon and retail sites lead to in-store sales

For price comparison, too:

• Online-only retailers (56%)

• Retailer sites (51%)


Retail brand names influence research

40% of shoppers who

bought a computer at

Wal-Mart had searched

Amazon within 24 hours

Nearly 80% of keyword

searches also included a

retailer’s name

"Consumers definitely don’t

just think about the product

in a vacuum; they almost

always think about the

product in the context of the

retailers where they are

most likely to go to and buy

this product.”

—Becky Wu, Senior Executive

Vice President, Research, Luth

Research


Price and size

influence the

discovery

phase


Most digital

buyers

research

purchases

made online

the day of the

purchase or

the week

before


Most shoppers take over an hour to convert

42%

of all purchases happen

within 60 minutes of a

shopper’s first visit to a

website

(source: Monetate, Q1 2016)


Devices and Channels


Shoppers tend to buy on the same device used

for browsing


Desktop-only

research is

the most

common

method

among digital

buyers, but

that behavior

is shifting to

mobile


A higher number of multidevice users purchased

with a tablet when it was part of the equation

Purchase

completed on:

% who used

multiple devices in

path to purchase(Criteo, Q4 2015)

35% 43% 37%


Location


Smartphones

are no longer

exclusively

on-the-go devices


Smartphone

research is

increasingly

being done in

the home,

surpassing

on-the-go

research in

2014


At-home research is affecting foot traffic

“They’re spending less time in

the store because they already

know what they want and

they’ve done the research, and

they’ve been retargeted to

really drive it home.”

—Jeff Campbell, Co-Founder

and Managing Director,

Resolution Media


“Instead of mobile being a small part of the

journey where people would enter the

facility and then make a decision, the

decision would be made on the mobile

device before they enter.”

—Melissa Burdon, Director, Marketing

Optimization, Extra Space Storage

Image source: Extra Space Storage

Sales increased 23% after

providing more mobile info


Showrooming

isn’t what it

used to be


Digital buyers

often make

purchases

in-store


Consumer Behavior


Everyone

prefers digital

over in-store

for research


When shoppers decided to

buy digitally:

Laptops were favored by

Asians (71%)

Hispanics used mobile

phones the most (57%)

Whites had the highest

desktop usage (48%)


Price comparison is the leading shopping-related

mobile activity among all except for boomers


61%

of US internet users

start shopping on one

device but continue or

finish on another

(Source: Google/Ipsos Connect, March 2016)

Younger shoppers are more inclined to use

multiple devices

84%

of millennials do this

(Source: Google/Ipsos Connect, March 2016)


Younger

generations

have stronger

feelings about

the importance

of retailers

having physical

stores than

older shoppers


Interest in

omnichannel

shopping options

isn’t strong


Privacy is less

of a concern

for younger

shoppers


Meeting expectations in-store …

Image source: Sephora Image source: Warby Parker

Reading reviews is the leading

reason (79%) why US female

beauty buyers use mobile in-store(Facebook IQ, Feb. 2016)


… and at-home or anywhere

Image source: Sephora

57% of omnichannel beauty shoppers

say that in the future they will start or

buy more beauty products on their

smartphone(GfK, Sept. 2015)


Augmented reality: Jerome’s

Image source: Jerome’s

Users are 35% more likely

than other site visitors to

call the company, get

directions to a store or fill

out a finance application.

65% are more likely to buy.


Opportunities and Challenges


Consumer

expectations are a

challenge


A majority of marketers lack confidence in

understanding customers


O2O sales

attribution is

still a work in

progress


Successful

marketers

focus on

analyzing

different

factors than

others


Personalization

“We look at technologies and solutions,

whether it be consumer-facing or employee-

based, that will remove points of friction from

the path to purchase. It could be as simple

as using a geofence to identify when a

customer walks into a store and showing

them information like their point balance and

store-specific promotions, which would be

useful to know before they purchase certain

products.”

—Kartik Subramanian, Walgreens


O2O sales

attribution is

still a work in

progress


47% of

marketers

tracking the

path to

purchase

consider their

capabilities to

be good or

excellent


Technology is improving but still a challenge

“Even with just online, being able to connect the

dots across different devices and publishers is

already hard enough. And to be able to tie offline

transactions to offline sales is even harder,

because a lot of the time, advertisers just don’t

have the right technologies and tools in order to

do so.”

—Anh Bui, Product Marketing Manager, Facebook


Recap

1. Mobile has changed consumer expectations when it comes to

purchases.

2. Consumers are better informed than ever, and time between

research and purchase is shrinking.

3. Multidevice usage is common, and smartphones are no longer

on-the-go devices.

4. Age plays a large role in mobile consumer behavior.

5. Understanding the customer journey is still a challenge for

marketers.


IBM Marketing Cloud helps you use customer

behavior to deliver custom experiences and

messages across the entire buyer journey.

So you can reach the right people,

with the right content, at the right time.

Visit ibmmarketingcloud.com


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Krista Garcia

The Changing Path to

Purchase: What it Means to

Add Mobile to the Mix

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