BARCELONA, Spain—Marketers have grappled with privacy regulations for years, but the rise of younger generations who are accustomed to receiving targeted digital ads may finally be changing the game for retail brands.
Speaking during a panel titled "Retail: Convergence of digital and physical," Nick Jones, evp of innovation and growth at Leo Burnett's Arc Worldwide retail practice, said millennials and Gen-Z are warming to technologies like NFC (near field communication) and mobile payments that deliver personalized content such as coupons or videos.
"By definition, things like NFC are opt-in because the shopper is making a decision to tap the product," he said. "The new generation of millennials and even younger audiences are getting more familiar with that kind of blended world where there isn't quite as much of a protection of privacy.
"Frankly, they've kind of grown up with the personalization of content where I'm aware of where you've shopped, where you left a [shopping] basket, and I'm going to remind you. They see that more as a value than necessarily an intrusion of their privacy."
Victor Ortiz, director of mobile retail engagement at Toys "R" Us, added that targeted marketing—like a coupon delivered to an in-store shopper—is a way to lower privacy concerns.
"If we're finding the right moment to reach out to you, and it's something you find helpful, you avoid that creep factor," he said.
To that point, Toys "R" Us is starting to design mobile experiences for specific use cases. For example, its mobile site includes a click-to-call button that people can use to contact a store, and that saves coupons and offers to be redeemed in person.
Oritz backed up his point with recent data that IBM Watson gathered after the holidays. On Cyber Monday, tablet and mobile traffic made up roughly half of all Web traffic. But when it comes to conversions, mobile-generated sales only made up 25 percent of desktop's revenue.
"That doesn't necessarily mean that 75 percent of these sessions are failing, they're doing other things," he said. "[We're] starting to think about different measurements of success—how often are they searching for stores? Are they clicking on the call button on your store page and asking for information?"