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National Retail Federation data indicates Amazon sales grew 22 percent over the holidays, as the e-commerce giant posted its most profitable quarter yet. To compete with Amazon's e-commerce challenge, brick-and-mortar stores such as Walmart and Target have been boosting their online presence, CNBC reported.

Here are four reasons smaller businesses should emulate this sound strategy to gain an edge on both online and brick-and-mortar competition:

 

Greater Marketing Outreach

Half of Americans now shop with mobile devices, according to a new study by Arc Worldwide. Most of this mobile shopping population does not consist of heavy mobile shoppers, but rather light mobile shoppers who use smartphones for activities such as looking up store hours and locations. These light mobile shoppers are the future of e-commerce, with their numbers expected to double as they become heavier online shoppers.

Gaining brand visibility with these mobile buyers will become increasingly crucial for brick-and-mortar retailers to stay competitive. By developing mobile stores and apps to reach out to both heavy and light mobile shoppers, brick-and-mortar retailers can both avoid losing customers to online competitors and increase their marketing outreach to include the growing mobile shopping population.

Better Sales Effectiveness

Despite the growth of mobile shopping, 85 percent of consumers prefer shopping at a physical store, a TimeTrade survey found. Seventy percent of consumers even said they would prefer to shop at a physical Amazon outlet instead of the company's website. Customers like to be able to see and touch a product and talk to a real person - all experiences that build trust.

Due to these factors, brick-and-mortar stores have a sales advantage that can be leveraged against online-only competitors if they take steps to reach out to mobile shoppers and get them in the store. Mobile marketing strategies such as geofencing can assist with this task by identifying smartphone shoppers in and near stores and sending them targeted offers that steer them toward in-store sales representatives and purchases.

Lower Inventory Costs

Another good reason for going online is to reduce the cost of inventory while increasing efficiency. Having an online catalog display allows you to present customers with a full range of selection without having to maintain every item in-store.

For instance, TireBuyer's website features more than three million tires from the most sought-after brands that customers select online for delivery to a local installer or to their own home. This avoids the need for local outlets to maintain huge inventory while still allowing them to enjoy the benefits of offering a wide range of options.

Better Handling of Mobile Payments

The fact that more buyers are using their smartphones as mobile wallets to make in-store purchases is another important reason brick-and-mortar retailers need to be online. The number of Americans using their smartphones for mobile purchases will triple in 2016 to number nearly one in five smartphone users, eMarketer projects, and 148 million global consumers will use their smartphones to make contactless payments this year. Juniper Research anticipates that 70 percent of new mobile wallet users will pay via Apple Pay or Samsung Pay.

These numbers mean that many of your customers will be coming into your store at the tail end of a purchasing process that began online and will ultimately be transacted on their mobile device. Being able to make this purchasing process as seamless a transition as possible between your customers' online and in-store experience will be the difference between your store's success and failure as mobile wallet adoption grows in the coming years.

 

Roy Rasmussen, coauthor of Publishing for Publicity, is a freelance copywriter who helps small businesses get more customers and make more sales. His specialty is helping experts reach their target market with a focused sales message. His most recent projects include books on cloud computing, small business management, sales, business coaching, social media marketing and career planning.

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