Google Says Shoppers With Smartphones Spend More

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(click image for larger view and for slideshow) Google, which is heavily invested in smartphones, search advertising and mobile commerce, has just published a study that suggests retailers have reason to embrace smartphones, search advertising and mobile commerce.

The study, conducted with the assistance of M.A.R.C. Research and the Google Shopper Council, finds that 79% of smartphone owners use their mobile phones for shopping and 84% of those who do so use their smartphones in retail stores.

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When shoppers evaluate products in stores by using their smartphones to compare prices with online retailers, that's known as "showrooming." It's a practice retailers dislike because they tend to have trouble competing on price with the likes of Amazon.com. Placed, a mobile analytics company, conducted a study in January that reaffirmed the threat showrooming represents to traditional retailers. To underscore that point, the study noted that Best Buy and Target, in an effort to curtail showrooming, have put policies in place to match Amazon.com prices.

[ Everybody wants a piece of the mobile market. Read Microsoft Opens Office Web Apps To Android Tablets. ]

A related recent Gartner study suggests that less than 10% of shoppers end up buying from a showroomed retailer. With customers like these who need enemies?

Well, Google would have retailers believe that smartphone-armed shoppers aren't as bad as all that. In fact, Google's research suggests they're big spenders.

"We compared the in-store purchases of moderate and frequent smartphone users and found that basket sizes of frequent mobile shoppers were 25%-50% higher," said Adam Grunewald, mobile ads marketing manager, in a blog post. "For instance, while the average appliance smartphone shoppers spends $250 per shopping trip, frequent smartphone shoppers spend $350."

Google argues that winning over smartphone-wielding shoppers requires being present online, ideally in Google's search index. Google's study indicates that 82% of smartphone shoppers rely on mobile search to help make purchase decisions, which is more than the 62% who turn to store websites or the 50% who turn to brand websites.

Gartner research VP Allen Weiner suggested in a blog post earlier this year that retailers combat showrooming by hiring people who are passionate about the product they're selling.

But that may not be the answer. Google's study suggests that hiring fewer people or keeping employees hidden might be the best way to win business from smartphone shoppers. Grunewald notes that a third of smartphone shoppers "would rather find information using their smartphone than ask a store employee." And the percentage of employee-averse shoppers rises to almost 50% when the product category is electronics and appliances.

Whether smartphones make shoppers antisocial or make wiser advisers than poorly trained employees, retailers need to adapt. "[I]t's clear that smartphones are changing the in-store experience, and that winning the key decision moments at the physical shelves means owning the digital shelves too," said Grunewald.

Our 2013 IT Spending Priorities Survey shows IT pros are playing catch-up after a period of underfunding. Also in the new, all-digital Vicious Circle issue of InformationWeek: Twitter's security boost might be too little, too late. (Free registration required.)

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