Survey: Half of shoppers don’t want their smartphones tracked

Not that anyone thought it would be easy, but new research points out just how tricky it is for retailers to build a cutting-edge shopping experience without alienating the very consumers they hope to attract or hold on to.

It turns out that in-store tracking of shoppers’ smartphones is a non-starter with half of those recently surveyed by PunchTab, a Palo Alto-based firm that helps retailers and brands build loyalty and engagement with customers.

“Fifty percent of consumers just didn’t want to be tracked,” says Robyn Hannah, PunchTab’s vice president of public relations. “A lot of it was around privacy concerns. A lot of it was that they felt that they were being over-marketed to.”

In fact, of the half of respondents who said they were not likely, or not at all likely to agree to be tracked, more than half (51 percent) said their main concern was privacy. “Stop being creepy,” one respondent told PunchTab. “Seriously, stop trying to convince people that abusing their privacy is a good thing,” said another. “You don’t need this information.”

Specifically, PunchTab found that 13 percent said they already get too many messages; 12 percent said they are bothered by offers for things they’re not interested in and 1 percent said they didn’t like being told how to shop.

The numbers sound grim, but Hannah made the point that marketers and e-commerce enterprises could also see the glass as half full. OK, maybe a quarter full. In fact, 27 percent of those surveyed said they’d be OK with tracking under certain circumstances — and those are the consumers businesses should focus on.

“I think with the millennial demographic, in particular, they understand very well that there is an exchange, a trade. You can have my data, but what do I get out of it?” Hannah says.

The PunchTab findings, which have also been reported by eMarketer, are particularly interesting because they touch on some of the solutions that brick-and-mortar retailers have embraced as a way to compete as shopping increasingly moves online and as Amazon continues to bulk up as a competitor.

It’s not that retailers are oblivious to consumers privacy concerns. They’ve known for years that they need to move cautiously into a world of providing personalized recommendations that are relevant to a customer at exactly the right time and in exactly the right place. But the thinking always was that consumers would be willing to share private data — like location information — in return for discounts, convenience and notifications about upcoming sales.

And though that appears to be the case for only a fraction of those surveyed by PunchTab, when it comes to smartphone users, even a fraction is a significant number. PunchTab reports that 58 percent of Americans have smartphones and 72 percent of them use their phones while shopping.

When shoppers are armed with smartphones, retailers can deploy beacons and track willing consumers in their stores. That way they can offer coupons for nearby products that shoppers prefer, or they can suggest alternative or additional items that might suit their fancy based on past purchases and other intent signals.

Smartphones, our lifelines, are smack in the middle of the sweet spot of these efforts as stores work to marry consumers’ penchant for online shopping and buying with the traditional practice of browsing clothing racks in brick-and-mortar stores.

“Here is a significant opportunity for marketers right now to leverage the GPS in mobile phones to make users aware of their products in the store in real time,” Hannah says.

Of the golden 27 percent, PunchTab found 88 percent say tracking is appropriate when it results in coupons or special offers, 72 percent say tracking is OK if it can speed up the checkout process and 58 percent said tracking was fine if the system let shoppers know that they were closing in on a loyalty reward.

The key is to focus on those willing to be tracked and give them what they’re after in return.

“Seventy-two percent said shorter check-out time,” Hannah says. “Today’s retailer is competing heavily with online retailers. Nobody wants to be the Blockbuster to the Netflix, the Border’s to the Amazon. The in-store experience is painful right now and they have a chance to make that better and more desirable in order to compete with those online retailers.”

But the work doesn’t stop with the 27 percent who are open to location tracking. By keeping them happy with offers and an improved shopping experience, retailers will create ambassadors for the idea of tracking.

“If you can sway that group first and demonstrate that you’re trustworthy,” Hannah says, “they’ll create greater consumer adoption, especially in the millennial demographic.”

And if you’re able to take the 27 percent open to tracking and add to it the 23 percent who classified themselves as “indifferent” on the subject, suddenly you’re halfway home.

Mike Cassidy is BloomReach’s storyteller. Reach him at mike.cassidy@bloomreach.com and follow him on Twitter at @mikecassidy

 

Illustration by Rick Nease/The Detroit Free Press/MCT archives

 

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