Study links in-store Wi-Fi to retail loyalty and sales gains

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EarthLink Holdings Corp., the managed network and Cloud solutions provider for multi-location businesses including hundreds of national retailers, recently partnered with experts from research consultants IHL Group and Cloud-managed Wi-Fi solutions provider AirTight Networks to conduct one of the first-ever studies - Impact of Store Networks and Wi-Fi on the Customer Experience – to measure the impact of the retail industry's plans for store networking, Wi-Fi, security and engagement. While preliminary findings were made public in January, the surprising final results and survey analysis are now available.

According to the research, deployment of in-store Wi-Fi had the most significant positive impact on retail sales and loyalty of any technology initiative. Almost half of the participating retailers, representing all retail sizes and types, claimed increased customer loyalty due to deploying in-store employee Wi-Fi, with an associated 3.4% increase in sales. One third of retailers (28%) reported increased customer loyalty due to deploying in-store customer Wi-Fi, with an associated 2% increase in sales. These dramatic results point to employee Wi-Fi as an even bigger positive driver than customer Wi-Fi, and highlight the importance of a creating a connected, flexible workforce untethered to point-of-sale stations. 21% of retailers also reported an increase in customer dwell time in their stores due to deployment of in-store Wi-Fi. For these same retailers, top uses included traffic counting at 56% and Session Duration and Device Used at 49%.

Additional key findings include:

  • 40% of IT budgets are now allocated to deploying new and innovative systems, compared to historic measures of 15-30% of budget.
  • Nearly 70% of specialty retailers are designing their next Point-of-Sale system based on a central order management system, which will put up to five times more load on the network and will require a WAN infrastructure refresh
  • Per the increased push towards WAN, 34% of participants plan to update their WAN network security within 12 months, and 34% also plan to update their WAN bandwidth optimization to take advantage of changed software architecture and enhanced customer experience options

"As retailers dramatically upgrade store infrastructures to create the experience of the future, there is a tremendous need for increased bandwidth and security, driven by moving to a single version of the truth for data, mobile devices in the store, and the accompanying systems," said Greg Buzek, IHL. "What also unquestionably emerged from the study data is the greatest bang for the buck for increased loyalty and sales is the deployment of Wi-Fi to store associates for use with mobile devices. This allows them to get more item information and save sales otherwise lost as well as replicate the experience of their best salespeople across the chain. Subsequently many retail segments see further growth by offering Wi-Fi to customers. Smart retailers are racing to upgrade their stores to take full advantage of the opportunities."

Greg Griffiths, Vice President of Product Marketing, EarthLink, remarked, "Now that we've released the final study analysis, retailers can use this valuable information as a benchmark to compare where they are versus peers and work towards developing an ROI for new applications."

"The IHL report shows that savvy retailers are already seeing revenue increases from deploying in-store Wi-Fi, be it for employees or customers. Increasing same store sales is a team goal, and that's where IT and marketing can both draw on the IHL's research data to justify the Wi-Fi investment," said Kevin McCauley, Director of Retail Market Development, AirTight Networks.

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