mobile promotions as an omni channel retail strategy in ... · mobile promotions as an omni channel...

Mobile Promotions as an Omni

Channel Retail Strategy in

Shopping Centers

Roel Vos

Aloys Borgers

Astrid Kemperman

Urban Systems & Real Estate

Department of the Built Environment

Introduction

• Online shopping: increasing trend

• Retailers’ revenues in physical shopping environments

are at stake.

Vacancy in shopping environments

• New ICT developments in shopping environments

Main research question:

• Are mobile promotions effective in having consumers

walk longer distances (and stay longer and spend more

money in a shopping center)?

6/25/2017

Mobile promotions

• Offer consumers an attractive deal in the shopping

center by means of mobile devices

• Mobile device: simulated by an interviewer using a tablet

• Special offer: option to buy a particular product at

reduced price somewhere in the shopping center; today

only

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Approach

• Intercept individual consumers while shopping in

different district shopping centers

• Show consumers a special offer:

• different product categories, different quality segments

• different levels of promotion value (price reduction)

• different locations in shopping center

• Would you accept the offer and go to the shop?

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Approach

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Mobile Promotion:

• Spend at least €25.- in fashion shop …

• and get a €5.- / €10.- price reduction

• Location shown on a map

Approach

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3 urban district shopping centers:

• Brusselse Poort Maastricht Medium-sized

• Woensel Eindhoven Large

• Zuidplein Rotterdam Large

5 product categories:

• Groceries

• Personal care

• Fashion

• Jewelry

• Catering

each in 3 quality segments (low, medium, and high quality shop)

Approach

Different levels of promotion value (reduction):

Spend: High Low

• Groceries > €10.- €5.- €2.5

• Personal care > €10.- €5.- €2.5

• Fashion > €25.- €10.- €5,-

• Jewelry > €25.- €10.- €5,-

• Catering > €5.- €3.- €1.5

Promotions at different locations in shopping center

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Data collection

• Entrance

• Visited shops and expenditures and time spent so far

• Shops to be visited and expected expenditures, time

• Promotions from 3 product categories (shops)

• one category visited or planned to be visited

• one category not visited and not planned to be visited

• catering

• Per category:

• 3 shops at different positions in the shopping center

• Promotions at fixed promotion value (High or Low)

• Max. 9 special offers per consumers (Accept: yes / no)

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Shopping center Brusselse Poort Maastricht

6/25/2017

Supermarkets

Catering

Jewelry

Personal care

Fashion

Ground floor Basement

Shopping center Woensel Eindhoven

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Supermarkets

Catering

Jewelry

Personal care

Fashion

Shopping center Zuidplein Rotterdam

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Supermarkets

Catering

Jewelry

Personal care

Fashion

Data collection

• December 2015 – February 2016

• All days, except Sundays

• Interviews at different locations in the shopping center

• 731 respondents

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Respondents

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Brus. Poort Woensel Zuidplein

Male 46.3% 33.6 35.5

Female 53.7 66.4 64.5

18-35 26.6% 20.9 45.3

36-65 52.1 50.8 32.2

> 65 21.1 28.3 22.4

Male only 27.7% 16.0 19.6

Group 36.8 41.0 42.0

Female only 35.5 43.0 38.4

N= 242 244 245

Reaction to mobile promotions

YES NO N

Brusselse Poort 31.6 68.4 1587

Woensel 26.7 73.3 2065

Zuidplein 33.6 66.4 1992

overall 30.5 69.5 5644

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Acceptance by shopping center (in %)

Reaction to mobile promotions

YES NO N

Groceries 36.2 63.8 748

Personal care 38.3 61.7 1067

Fashion 28.6 71.4 963

Jewelry 17.6 82.4 700

Catering 29.7 70.3 2166

overall 30.5 69.5 5644

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Acceptance by product category (in %)

Reaction to mobile promotions

YES NO N

Low 27.2 72.8 2687

High 33.5 66.5 2957

overall 30.5 69.5 5644

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Acceptance by promotion value (in %)

Interested in Shopping Center App?

YES NO N

Brusselse Poort 41.7% 58.3 242

Woensel 34.0 66.0 244

Zuidplein 45.7 54.3 245

overall 40.5 59.5 731

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More interested if visitor is:

• Younger

• Higher educated

Logistic regression per product category

Explanatory variables

• Shopping center (Brus. Poort, Woensel, Zuidplein)

• Day (Mon-Thursday, Friday, Saturday)

• Daily period (9-11h, 11-13h, 13-15h, >15h)

• Gender (male, female)

• Age (18-35, 36-65, 66+)

• Group composition (1 male, group, 1 female)

• Distance home – shopping center (<5km, 5+km)

• Respondent is interested in shopping center app (Yes, No)

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Logistic regression per product category

Explanatory variables cont’d

• Promotion value (high, low)

• Promotion store segment (high, medium, low quality)

• Number of stores visited up to the mobile offer

• Number of visits per store type up tot the mobile offer

(Groceries, Fashion, Personal care, Catering, Other )

• Duration shopping up to the mobile offer (<15 min, 15-45

min, >45 min)

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Logistic regression per product category

Explanatory variables cont’d

• Distance walked up to the mobile offer (in 100 m)

• Distance to walk to visit remaining stores (in 100 m)

• Distance detour to visit the mobile offer store (in 100 m)

• Detour relative to Distance walked (ratio)

• Detour relative to Distance to walk (ratio)

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Distances: shopping center map

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Distances: start at entrance

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IN/OUT

Distances: 3 stores visited

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IN/OUT

Distances: meet the interviewer

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IN/OUT

Interview

Distances: store to be visited

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IN/OUT

Interview

Distances: distance walked

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IN/OUT

Interview

Distances: distance to walk

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IN/OUT

Interview

Distances: promotion

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IN/OUT

Interview

Promotion

Distances detour

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IN/OUT

Interview

Promotion

Logistic regression

• Dep. variable: Accept promotion?

• Per type of product

• Stepwise

• Backward: LR

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Logistic regression: Goodness of fit

Groceries Fashion Pers Care Jewelry Catering

% correct

Start 65.8 71.6 62.7 82.1 70.9

% correct

Final 70.7 73.2 73.2 82.9 73.6

Nagelkerke R2 0.19 0.12 0.32 0.26 0.15

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Constants and shopping center effect

Groceries Fashion Pers Care Jewelry Catering

Constant -2.9 -2.8 -1.5 -5.3 -1.2

Bru Poort 0.8 -0.5

Woensel 0.7 0.5 1.1 -0.3

(Zuidplein) - - - - -

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Day of the week and Daily period

Groceries Fashion Pers Care Jewelry Catering

Mon…Thu 0.8

Friday

(Saturday) - - - - -

9-11h 1.0

11-13h 1.2 -0.8 1.2

13-15h 1.2 1.5

(> 15h) - - - - -

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Gender and Age

Groceries Fashion Pers Care Jewelry Catering

Female 0.96

(male) - - - - -

18-35 -0.45

36-65 -0.23

(>65) - - - - -

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Education and Group composition

Groceries Fashion Pers Care Jewelry Catering

High Edu -0.5

(low) - - - - -

group -0.8 0.5 0.4

1 female 0.5

(1 male) - - - - -

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Distance from Home and Interested in app

Groceries Fashion Pers Care Jewelry Catering

≥ 5km 0.4 0.9 0.7

(< 5km) - - - - -

SC-app 1.2 0.5 1.4 1.3 1.3

(no) - - - - -

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Promotion value and Quality segment

Groceries Fashion Pers Care Jewelry Catering

High value 0.4 0.9 0.3

(low) - - - - -

Medium 0.8 1.0 1.0 2.4

High 0.6 0.8 -0.9 1.6

(low) - - - - -

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# Stores visited (all and per type)

Groceries Fashion Pers Care Jewelry Catering

#stores

visited -0.2

Grocery -0.9

Fashion 0.2 -0.2

Pers Care -0.3

Catering 0.5 -0.8

Other 0.2 0.2

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Duration and Distance in shopping center

Groceries Fashion Pers Care Jewelry Catering

< 15 min 0.7 -0.7 0.3

15-45 min 0.5 -0.6

(> 45 min) - - - - -

Dist walked 0.4

Dist to walk -0.5 -0.1

Detour -0.2

Detour/walked

Detour/to walk -.04 6/25/2017

Conclusions

• product categories:

• Most effective: Personal Care, Catering

• Least effective: Jewelry

• Interested in shopping center app: positive effect

• Preferably offer promotions in the medium quality segments

• Effect of (extra) distance to walk: negative for Groceries,

Personal Care and Catering

to have visitors walking longer distances, offer females and

groups medium or high quality fashion promotions in the

early morning or early afternoon when they enter the center

/ Urban Planning Group 6/25/2017

The End