Keeping tabs on shopping: Why tablet should be front of mind for retail marketers

Christmas 2013 showcased the power of online retail, fuelled by mobile. As more consumers spend time – and money – on tablets in particular, Sam Scott explores why the platform should be front of mind for retail marketers.

From cars to clothes, it seems that today’s shoppers are willing to buy almost anything online, and findings on the use and sales of tablets over the Christmas period highlight the important role that tablet is playing in the growth of e-commerce. As mobile gains ever more scale and momentum, the latest data shows that tablet is not only growing faster than smartphone, but trumping it in key areas.Research published by eMarketer just prior to Christmas predicted that UK commerce via mobile devices would double over 2013 to £8.17bn, or 18 per cent of total UK retail e-commerce sales, with tablet commerce tripling to £4.74bn. Fresh data from Millennial Media also indicates that advertising on UK tablets jumped during the festive period, with the number of daily impressions growing two thirds between Christmas Day and New Year’s Day. “This growth will certainly continue in 2014, and with increased activity comes new opportunities for advertisers to reach consumers on tablets,” says Zac Pinkham, interim managing director, EMEA, Millennial Media.The rise of e-commerce on tablet is in part due to a rapidly expanding user base. “Tablets have achieved an incredible market penetration in two years, and it’s impacting us in a very profound ways,” says Bill Loller, vice president at IBM Tealeaf. The number of tablets sold worldwide has increased by nearly 70 per cent in 12 months, according to Gartner, who also predict that tablet sales will overtake all other PC types by 2017. YouGov predicts that 1.3m tablets were gifted in the UK this Christmas, adding to the 16.5 million Britons who already have one. According to Deloitte, this is partly due to the influx of smaller and cheaper models such as Tesco’s Hudl and Argos’s MyTablet, which both retail for under £120. The rapid growth of tablet ownership has had significant effects on mobile commerce. Data from IBM’s Digital Analytics Benchmark indicated that sales completed from mobile platforms in the UK grew 63 per cent over Boxing Day the previous year, exceeding 45 per cent of total online sales. 20 per cent of sales from 23 December to 2 January were made through tablet, according to Rakuten. “Our data reflects the rise of the tablet as a primary shopping device – across our CPA network over the Christmas and New Year period we saw 20 per cent of all sales coming through tablets,” explains Rakuten Marketing managing director Mark Haviland. “Consumer purchasing behaviour is changing and it’s becoming clear that tablets are powerful shopping tools as their high resolution images and simple navigation around shopping sites allow consumers to purchase quickly and easily,” he adds.And while smartphone drove marginally more Boxing Day traffic compared with tablet – a somewhat unsurprising fact considering the much larger user base – it was the latter that accounted for 29.4 per cent of all online sales, almost double that of smartphone, according to IBM.“I would expect that if you look at Boxing Day 2014, the percentage of sales on tablet will easily double. Smartphone will increase but not at that kind of rate. The reality is that tablet has been driving m-commerce for a couple of years now,” says Loller. “Smartphone usage will drive online traffic because we use it as a research tool, but its not going to drive the commercial aspects,” he adds. This indicates that with respect to m-commerce, tablet is punching above its weight. But experts typically agree that the location and time of purchase account for these trends, rather than the item being purchased. “Even things like cars are selling online, groceries are growing hugely, and our number one category for buying online is clothing. People are willing to buy anything online these days. And it impacts every single product category,” says Tom Smith, CEO of GlobalWebIndex.But why is tablet threatening to outperform smartphone on gross online sales? Bill Loller suggests that it comes down to basic differences in user behaviour. “On a smartphone our behaviour is very task oriented, you want to check your bank balance, check that your flight’s on time, or buy something specific. The tablet, however, lends itself to more of a browsing experience – there’s more space to see things, it’s more visual, you can get a feel for things,” he explains.Device specific research on usage throughout the day, such as that carried out by Ukom, indicates that tablet use has definite peaks. “We see tablet usage being concentrated outside working hours, so the nature of browsing on tablet looks quite different to PC or mobile,” says Ukom’s general manager, James Smythe.Social behaviours also bear relevance to the differences in sales between tablet and smartphone. “Tablets are intrinsically social devices. If you’re sitting with your family you can pass it around and ask for opinions, whereas people don’t hand their smartphones around – it’s a little too personal, there’s too much information there about you,” says Loller. With indications that shopper journeys are traversing multiple platforms, many retail strategists are emphasising the importance of offering a seamless and multiplatform experience. “A multiplatform retail experience is a must because you might spend time looking at the mobile app but then not make the transaction till later when you’re on your PC or tablet,” says GWI’s Smith. In some respects the similarity between tablet and PC is taking retail and marketing back to a more web-based experience, arguably a comfort zone in comparison with the smartphone world.However a March 2013 report by Chase Paymentech and Dynamic Markets suggests that tablet m-commerce still has some way to go, with 93 per cent of tablet users left frustrated by their retail experiences, resulting in more than two thirds of them failing to purchase.And yet by GlobalWebIndex’s measures the UK is the most developed e-commerce market in the world, with the highest portion of spend going through online channels, and Smith hastens to acknowledge the innovation that has already been achieved. “In the UK traditional retailers have become very web-savvy in terms of how they build their e-commerce offerings, and the integration between online and offline, like the click and collect, which has expanded the market even further.”These trends have obvious implications for retail strategy and advertising spend.“In 2013 advertisers realised that they had to start treating mobile users differently to desktop users,” says Sian Rowlands, research analyst at Juniper Research, who believes that the realisation that mobile banner ads were underperforming in terms of ROI came in 2011/12, just as tablets became a mass-market product. “This made advertisers consider that the tablet is far more conducive to displaying rich media ads than a smartphone,” she says.Rowlands also claims that despite tablet ads demanding a typically greater cost per 1,000 impressions than smartphone, the high ROI is attracting advertisers as increasing numbers of consumers transact through their tablet device. With data from the Christmas period providing strong confirmation that tablet is serious business, not just in terms of user-base but also retail behaviours, 2014 may be a phase of adjustment for some, and advantage for others.

Key strategies for tablet commerce in 2014

As consumers are increasingly shopping across devices and channels prior to purchase, creating a seamless multichannel retail experience has become a top priority for m-commerce strategists. IBM Tealeaf's Bill Loller suggests that in 2014 retailers should be investing in optimised tablet sites in order to drive sales. "Retailers should be rolling out tablet sites so as the shopper switches device they have the context of where they were, which makes the buying experience easier.""All consumers care about is accessing the best experience," says MEC digital strategist Matt Bell, adding that "brands need to build it right with a ‘build once, deploy many’ mentality”.However with 4G connectivity around the corner more people will be using their tablets on the go, making location greater a factor in providing relevant communications. "Remember the need for convenience in user journeys and messaging – the right person, right device, right time, right message," says Bell. This point is echoed by Millennial Media’s Zac Pinkham, in relation to advertising, who explains: "If advertisers can identify specific behaviours that are relevant to their brand, such as location, demographic or context, they can create a campaign that is uniquely designed to leverage this."Context means that that there is no one-size-fits-all solution for tablet communications, he says, adding: "There is, however, tremendous opportunity ranging from mobile video, to full screen rich media gamification units, to campaigns that are designed to create a cross-screen experience, to name but a few."The research in tablet usage seems to agree that the platform is being used as a 'lean back' device, with peak usage occurring during the evening hours. "Because of the increased time consumers spend on their tablets vs other devices, long-form ads like video can be extremely effective," adds Pinkham.This article was first published as part of a mobile focus sponsored by Millennial Media in The Drum's latest issue (22 January), which is available for purchase here.