For shoppers, next level of instant gratification
All the world's a shopping cart.
A wave of experiments at various companies could take consumer convenience (and impulsiveness) to new heights. The ultimate vision is a form of shopping nirvana, where consumers can buy what they covet on the spot — straight from an attention-grabbing magazine ad, for instance, or off a television screen, or even from a refrigerator.
On Tuesday MasterCard plans to announce a partnership with Condé Nast, the publisher of Vogue, Wired, Vanity Fair and other popular magazines, that will allow digital readers to instantly buy items described in an article or showcased in an advertisement by tapping a shopping cart icon on the page. The partnership, called ShopThis, will begin in the November tablet edition of Wired, due on Oct. 15.
Peapod, an online grocer in the Northeast and Midwest that provides home delivery, recently developed a feature on its mobile app that allows customers to restock household staples by scanning bar codes with their smartphones at home.
"You are finishing the box of Cheerios, pouring your last bowl," explained Mike Brennan, Peapod's chief operating officer, "and before throwing the box away, you take out your phone and scan the bar code." The order goes straight to the consumer's virtual shopping basket.
And Paydiant, a company that develops mobile payment platforms for clients in the finance and retail industries, has created a technology for scanning a QR, or quick response, code off a television screen to redeem a coupon or instantly buy something a viewer fancies in a commercial or perhaps even during a television show.
"We have developed it, but we haven't deployed it," said Chris Gardner, a co-founder of Paydiant. "I would imagine someone is going to want us to do that over the course of the next year."
Such developments seem a natural extension of a culture that has immediate access to information, and more.
"The whole world right now is about instant gratification," said Matt McKenna, the founder and president of Red Fish Media, a digital and mobile marketing agency based in Miami, who is working with retailers to amp up their mobile sales strategy, including developing personalized digital look books that text new releases to consumers for instant purchase.
This push for immediate retail gratification is occurring as the delivery wars are escalating among some of the biggest e-commerce companies in a dash to get orders to consumers as fast as possible.
EBay and Amazon have initiated same-day service in a handful of cities. Walmart has been looking at ways to use its 4,000 stores as distribution points to fulfill orders the same day to customers outside major metropolitan areas.
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Even Google has gotten into the act with Google Shopping Express, a program that allows Northern California residents from San Francisco to San Jose to receive deliveries within hours of ordering from numerous local and national merchants, including American Eagle, Walgreens, Toys "R" Us and Target. They must pay with Google Wallet, the company's mobile payments system.
And while many experiments like ShopThis are in very early stages, they have the potential to shake up traditional business relationships among advertisers, consumers and merchants as they gain traction.
"With any sort of disruptive technology, people want to walk before they run," Mr. Gardner said.
For example, the ability to sell directly to a consumer could squeeze some of the so-called middlemen of commerce like big-name retailers.
"If Sony started selling stuff directly on a TV commercial, Best Buy might not particularly like that," Mr. Gardner said. "Once you can go directly to consumers, there's always the possibility of disintermediating one of the middlemen. Efficient markets don't like middlemen."
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Still, he and others say it is unclear what the effect will be, and established players like Amazon are unlikely to suffer.
In the media world, technology like MasterCard's ShopThis could change an already precarious relationship with advertisers. Some companies may find it unappealing to buy an advertisement in a publication that may be highlighting a competitor's product with technology that allows a click through to an instant sale. On the other hand, the ability to generate direct sales from an ad could be tantalizing to advertisers and merchants, spurring competition and bringing new revenue to struggling media companies.
Condé Nast plans to study Wired's experience before deciding whether to expand the program to its other magazines, but Wired's publisher, Howard Mittman, said he believes the technology will provide an enormous benefit to advertisers.
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"This is a moment of opportunity to provide better service to our advertisers," Mr. Mittman said.
The MasterCard ShopThis venture in Wired next week starts with about a dozen products in the magazine's "Gadget Lab" section and in an "advertorial" holiday gift guide. Clicking on the shopping cart icon will initiate a purchase through Rakuten.com, an e-commerce site, using the company's MasterPass mobile payments system. The company aims to expand to many more vendors, products and titles through individual ads and product pages.
Garry Lyons, the chief innovation officer at MasterCard said, the company has developed this click-through shopping technology to be "digitally agnostic," meaning it may be made available across several digital platforms, including television, video and movies.
"We believe any device is potentially a device of commerce, enabling the user to buy what they want from within the content without having to leave the content," Mr. Lyons said. "There is no reason why ShopThis couldn't be rolled out when watching a movie or video. You see an actor who has a nice shirt on, you activate ShopThis," he continued. "This is an example of incubation where we move quietly, test, learn, iterate."
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Some consumers, like Kelly O'Neil, a registered nurse in the Boston suburbs, are trying to tailor the convenience of online shopping to a busy routine. A two-hour delivery window at home does not usually work for Ms. O'Neil, who works full time and spends a lot of time driving for her two children's sports teams.
Recently she started using a new grocery pickup system that Peapod has started in some Northeastern areas in conjunction with Stop & Shop and Giant supermarkets. She drives up to her local store at the appointed time and an employee is outside waiting with her order. She does not even have to get out of her car. And she is not allowed to tip.
"It is so convenient and much more efficient," she said.
While consumers stand a greater chance to part with their cash in a world of instant shopping, it is not entirely clear who will profit most. Some hope on-the-spot transactions can solve one of the problems of e-commerce Web sites, full shopping carts that are abandoned before clicking to checkout.
The efforts also provide new opportunities for the mobile payments business, which for all the interest has not been terribly successful — after all it is still just as easy to use a credit card as it is to use a phone to pay in the checkout line. But paying outside the store on the fly could change the game.
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For all the talk, some efforts still have a far-out feel. Last month MasterCard held a conference for investors in New York called "The Future of Shopping." A woman was testing a new virtual 3-D fitting room app that takes a photo of a shopper and measurements and creates an avatar to "try on" clothes to show mobile shoppers how the garments might actually look on them. (They looked flattering, of course.) A man wearing a Google Glass, a computer that resembles eyeglasses, demonstrated the ability to find, order and pay for coffee from a nearby cafe with a couple of taps on the frame.
Walking through the showroom, Mr. Lyons speculated that someday refrigerators could be programmed to send alerts when milk or eggs are low or even send orders. Washing machines could do the same with detergent.
"The potential is endless," he said. "We're not trying to force people to buy things to drive them into debt but to make people's life easier. We want to use tech to make your life easier in some cases that will result in a commerce transaction."
—By Hilary Stout, The New York Times.