Supermarket chain warns agressive mobile interactions could turn off customers
- 14 February, 2014 13:47
Although UK supermarket chain, ASDA, sees mobile as a disruptive force to its business model, the retailer's head of insight and pricing believes that if too many different players make a 'land grab' for the customer it could kill all future interaction.
Alex Chruszcz was speaking at a British Retail Consortium conference in London this week, where he said that mobile provides a real opportunity to further cut costs out of ASDA's pricing.
He said that the retailer is fully focused on mobile since the launch of a new mobile application at the end of last year, but is fully aware of the competitive threat.
"At ASDA we are completely committed to mobile as a channel. But it's an arms race, everything that we put into our app at the end of last year for its launch - which got fantastic views, fantastic ratings - you need to just expect that the competition will catch up within months," said Chruszcz.
"The pace of change and the pace of development is so fast. Mobile interaction with the customer is about keeping your eyes open."
However, he argued that when you have customers using your mobile applications you shouldn't just use it as an opportunity to spam them with marketing, but instead harness the data to create efficiencies elsewhere in the business.
"I think more disruptively, we are interested in mobile and how it is changing the way people shop fundamentally. So how can we use mobile to be a better retailer? ASDA's advantage is price, we are cheaper than our competitors," said Chruszcz.
"Can we use mobile to make ourselves even more efficient to reduce our prices, but delivery better quality, better service, through new operating models. I think that's where it is genuinely exciting for us as a retailer."
He added: "There's obviously excitement within marketing for mobile as a way to send out more offers - but ultimately its just fancy vouchers and offers. Same as the stuff we have always had. The disruptive bit is how do you change your business to take advantage of the fact that you know where your customers are at any moment in time.
"The minute I can adjust my prices by 10 percent, then we are in a different game."
Finally Chruszcz noted that there are a number of players in the mobile space attempting to be the first and best at interacting with the customer - where he cited the platforms (namely Apple and Google), the banks (through payment technologies), the mobile operators and the third parties (such as the retailers).
However, he warned that this fierce competition could be problematic going forward.
"As businesses, as retailers, we are very conscious that there is a bit of a land grab to own this interaction with the shopper," said Chruszcz.
"You've got all these parties saying that they can get messages to the shopper through different media channels. Ultimately the customer has the choice to turn this stuff off and there is a real risk that if this is done inappropriately by just one or two organisations, it could kill the whole thing."