IBM study finds social networks influence more than half of shoppers’ decision-making - even in the store

Retailers need to acknowledge the importance of a true cross channel strategy including social networks as well as mobile, store, catalogue and online.

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LONDON, U.K. - 05 Sep 2011: A new IBM European study into consumer shopping behaviour across retail channels, including mobile phones, highlights that social media has an increasing influence on consumer purchasing decisions, even in the store, and that shopping through the mobile will also drive cross-channel demands.

Consumers are using social networks in a sophisticated way, researching products, prices, promotions and other consumers’ views, to validate their decision making. This is then influencing sales across all procurement channels – not just online. For example:

·    Influence: Over 50 percent of respondents aged 16 – 64 with access to the Internet use social networks to assist with shopping decisions and of those that would be likely to follow a retailer on a social network, 35 percent stated they use social media platforms to read reviews or rank products and services. Additionally, 25 percent of these adults think it is important to be able to use social networks to assist with buying decisions

·    Incentives: Of this same group, 57 percent said that the most likely reason to ´follow´ a retailer on a social network is to receive free trials of products or discount coupons

·    Cross-channel: When going on to make the purchase, around 4 in 10 of these online adults would still purchase the final product from within the store

David Hogg, commerce solutions regional leader at IBM, says: “Social media provides a new window through which retailers can deliver a more personal brand experience across all buying channels. By harnessing real-time customer analytics from social media, retailers can act upon what is being said, delivering a personalised marketing offer based on the customers’ shopping profile, preferences and decisions, helping retailers to maximise revenues.”

Other findings of the survey also highlighted consumers’ increasing desire to shop through the mobile phone. 51 percent of online adults said that they have shopped through the mobile phone, with 67 percent of these consumers deeming it important that they can not only capture, but also place an order, highlighting that this is a maturing market. The survey also found that mobile phones are incremental in providing additional revenue opportunities through promotions and last minute purchases:    

·    68 percent agreed that price comparison on the mobile is important or very important

·    38 percent and 29 percent say it is important to receive discount coupons and special offers through the mobile phone, respectively 

·    38 percent want to be able to review and change their shopping basket items at a later time, on their home computer.

“It is clear to see that the mobile phone is no longer just a viewing screen or digital catalogue - there is a growing acceptance of shopping through the mobile. As well connecting to these customers through their preferred channel, retailers also need to make sure they have the means of effectively managing their supplier and trading partner network to ensure they have the products at the right time and place to meet changing consumer demands.” concluded Hogg.

These and other findings were the result of the annual consumer research by IBM, across 4,000 adults in Great Britain, France, Germany and Italy who have access to the internet. IBM, as part of its Smarter Commerce initiative, is investigating how social networks are influencing buying behaviour in retail channels, including the store. The Smarter Commerce initiative is focused on helping companies swiftly adapt to rising customer demands in today's digitally transformed marketplace by addressing the spectrum of enterprise commerce activities - new ways to buy, sell and secure greater customer loyalty in the era of mobile and social networks.

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