Wednesday 20 April 2011

Apps are making shopping easy... or is life complicated enough already?

British supermarket giant Tesco announced its year-end results yesterday: in the figures was the information that its growth in online sales was 15%.  Encouraging except that online sales across the UK in 2010 rose 18%, according to researchers IMRG.  Tesco says that online sales grew "strongly", pointing to a 30% increase in non-food items from Tesco Direct - implying that supermarket sales grew by rather less than 15%.

Tesco, though, drew attention to its innovative new iPhone app, which it says now accounts for 12% of online sales.  This seems to be a smart idea - wherever you are, when you spot something that takes your fancy, just scan the barcode and Tesco will put it in your shopping basket for next time.

By chance, on the same day Tesco's arch rival Walmart announced that it was buying the social networking platform Kosmix.  Why?  Because, they say, you can't ignore social trends and this one is huge.  It's not clear exactly what Kosmix is offering Walmart, but it is something to do with the immediacy of mobile-based connections to real-time purchasing decisions.  It's all part of Walmart's multi-channel strategy, apparently.  Walmart - it has to be remembered - owns Asda, a UK supermarket chasing Tesco for the number one spot in FMCG retailing.
 
The sort of technology involved in Tesco's iPhone app is not new.  Barcode scanning using the iPhone is helping shoppers to make their purchasing decisions.  The Foodwiz app allows people with allergies quickly to check items in Asda and Tesco if they are celiacs or have other intolerances.  The company's software gives users rapid feedback about the suitability of branded foods and own label alike.  It hopes to have the programme rolled out to other supermarkets soon.

The same technology is offered by Barcoo to allow ethical shoppers to make quicker decisions.  This examines the environmental, ethical and CSR credentials of the brand owner (ie companies like Nestle and Procter & Gamble) and gives the user a quick response as to whether this is an ethical company.

Whatever way you look at it, smartphone ownership is exploding (something I blogged about a few days ago), just as social media continue to extend their influence.  It seems clear that the ultimate target market (young, educated, affluent, connected) are in both spaces.  And so are Asda and Tesco.

2 comments:

  1. 6 months later and Asda launches the iPhone app: http://econsultancy.com/uk/blog/8298-asda-launches-first-transactional-iphone-app

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  2. On Android phones too http://shop.asda.com/Mobile-apps/

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