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It’s a rather simple question: how will mobile technology impact local retailers? In this post, we’ll try to analyze the mobile retail landscape as a whole before understanding some of the major players and our predictions for the future.

By The Numbers

According to the 2012 Deloitte Retail & Consumer Spending Survey, Smartphones will influence 19%, or $689 billion, of U.S. retail store sales by 2016. This number is staggering, especially consider the fact that the same statistic was non-existant only a decade ago. What’s more, as we previously covered, in-store sales still dominates e-commerce in terms of volume and revenue with 93% of sales occurring in-store.

How Mobile-Retail Can Succeed

The key to a successful relationship between the use of mobile technology and retail stores is all about user experience. Right now, mobile products are quick to center the conversation around comparisons: price, sizes and availability. What’s more, mobile apps like Square, LevelUp, Google Wallet and now PayPal‘s in-store checkout center the experience around one monetized, actionable event: transfer of payment. This is easy for apps because it allows for greater control over user data and payment patterns once the transfer is completed from within the app. Yet local retailers are already wary of adopting mobile technology that may expose some of its shortcomings; this was the case when Amazon released its Price Check app–local retailers felt threatened by Amazon piggy-backing off their in-store inventory and shopper experience to drive sales of less expensive goods with guaranteed free shipping. So how can mobile technology work best for local retailers?

Of course a smooth checkout process is one huge factor for retail stores to adopt mobile technology–especially now that LevelUp offers an “Interchange Zero” pricing model. Yet retail locations can appeal to many different purchase motivators other than price. People value convenience, experience, uniqueness and other personal reasons when shopping. For brands and retailers, mobile apps and technology will be able to augment these experiences by providing a more convenient, integrated mobile experience as well. In short, the mobile-retail relationship could thrive from the personal connections that keeps brick & mortar stores delivering 93% of total retail sales. Perhaps it’s time to move beyond payment solutions towards discovery, recommendation, and personalized experience engines.

The Current Players


We believe that the biggest issue should not be if retailers will lose business, but rather how they can adopt new apps and technology to find customers. Although local retailers are still a ways off from integrating the in-store shopping experience into a mobile app, it’s time we recognize just how beneficial–not destructive–mobile technology could be for local retailers.

PS- Local retailers should integrate with new technology sooner rather than later, here’s why.