Is it time for stores to ditch the free Wi-Fi?

Photo: Getty Images
Jun 09, 2017
Tom Ryan

With inexpensive unlimited plans now regularly promoted by carriers and consumers less worried about overage charges, free Wi-Fi spots aren’t as popular as they used to be.

“Customers are rational,” Craig Moffett, an analyst at MoffettNathanson told Bloomberg. “When pricing incentives favor Wi-Fi, customers use more Wi-Fi. When pricing incentives shift, so does behavior.”

With the right data plan, a mobile phone can serve as a Wi-Fi hotspot for a laptop, as well. The signal from a mobile device is often stronger than the one found by tapping into a coffee, airport or hotel Wi-Fi source. Open Wi-Fi spots are also more easily tapped by hackers.

A ReportLinker survey even found that many Americans, including the majority of younger ones, are using their mobile phone to access the Internet at home. ReportLinker said the mobile phone appears “poised to eradicate the wireless router.”

For retailers, cost savings could come by not having to upgrade Wi-Fi or even offer it as part of the in-store shopping experience. Many stores and shopping centers still don’t offer free Wi-Fi to customers, or at least widely promote it.

For those that do, one loss would be the e-mail that generally comes when a shopper signs up to receive free Wi-Fi. Lesser known is whether the other benefits of retailers having Wi-Fi — including being able to deliver personalized messages, collecting any data on in-store behavior and linking in-store to online shopping — can be captured through their apps, beacons or some other method.

Still, the wireless price wars may lessen and free Wi-Fi spots may always hold some value.

According to a survey from HRC Retail Advisory, more than 90 percent of Gen Z consumers say that a strong Wi-Fi signal is important to them and their overall shopping experience. In a statement, Farla Efros, president of HRC Retail Advisory, said that while Gen Z “was born with a smartphone in hand, it doesn’t keep them from shopping – and even preferring to shop – in brick and mortar stores, as long as they have access to their ever-important social network.”

DISCUSSION QUESTIONS: How would the loss of free Wi-Fi as a shopper incentive impact retailers? Should retailers continue to invest in promoting and upgrading stores as Wi-Fi spots?

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"Turning off Wi-Fi in a retail store would provide minimal savings to the retailer and remove a convenience expected by consumers."

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25 Comments on "Is it time for stores to ditch the free Wi-Fi?"

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Mark Ryski

Low-cost unlimited data plans are greatly diminishing the impact of retailers dropping free Wi-Fi as a shopper incentive. I think the impact would be relatively low now and even lower as time goes on. And as for the benefits of using shopper data/behavior from their free Wi-Fi systems, these too will diminish over time. Ultimately retailers need to analyze Wi-Fi usage rates and monitor the activity level. If usage is diminishing, they might consider discontinuing; if usage is high then clearly they should continue to invest in, support and promote the service.

Art Suriano

For many consumers, Wi-Fi access is still crucial and a need-to-have. I think it’s too soon to begin eliminating it. People are used to the places where they can have easy Internet access like Panera, where it is part of their customer experience. For shopping in places where connections can be very slow because of the steel in the building, Wi-Fi is still a must have. In the years to come, as technology continues to move forward, we will eventually think of Wi-Fi as we chuckle today when thinking about dial-up internet. But until we have the next best way that everyone is using to connect, Wi-Fi access is imperative and needs to be something retailers offer.

Dave Bruno

This feels like an absolute no-brainer to me. Wi-Fi must stay in place until we get definitive answers to the questions Tom raises: ” … whether the other benefits of retailers having Wi-Fi — including being able to deliver personalized messages, collecting any data on in-store behavior and linking in-store to online shopping — can be captured through their apps, beacons or some other method.

Experience is everything. Losing this core ability to enable delivering richer, more personalized and empowered experiences in exchange for eliminating the relatively minor costs/headaches of in-store Wi-Fi seems like a short-sighted decision.

Harley Feldman

The access to Wi-Fi in retail stores for consumers has more to do with convenience than price. While some consumers may want to keep their phones on cellular communication in stores, most of them will always use free Wi-Fi if it is available. Turning off Wi-Fi in a retail store would provide minimal savings to the retailer and remove a convenience expected by consumers.

Dr. Stephen Needel

If 90 percent say it’s important, it’s important. That said, the more interesting question would be, you have the choice of shopping in two grocery stores that are equally convenient. One has Wi-Fi, the other doesn’t. Price and selection are equal. How much more likely are you to shop in the one with Wi-Fi?

This might be more informative.

Lyle Bunn (Ph.D. Hon)

We live in an active-lifestyle, connected world so now is not the time to drop free-to-guest Wi-Fi.Sure some will not use it at the risk of spam, push marketing or geo-awareness by the provider and it may impact on-site conversion due to comparison shopping or review browsing. But some businesses such as QSRs are destinations because of this service. The key is to manage how it is used such as limiting download speed or access duration. None of us would throw our knives out of the kitchen just because they have sharp edges.

Bob Amster

If the retailer provides a robust Wi-Fi signal in its stores, the speed will surpass that of smartphones. Consequently, all other things being equal, speed-addicted shoppers would find those retail environments that offer free, robust Wi-Fi connections to be more attractive places in which to spend more time (and hopefully more money). It’s too soon to announce the demise of free in-store Wi-Fi.

Dick Seesel

I’ve shopped in many stores and malls where the 4G signal is weak because of city locations (I’m thinking downtown Chicago) or because the buildings themselves are like concrete bunkers. So the access to free Wi-Fi is a benefit that most customers expect to find, even if they don’t use it or need it.

It’s not just a matter of unlimited data plans — until cellular signals are more reliable, why take away something that consumers are now trained to expect?

Meaghan Brophy
Meaghan Brophy
Senior Retail Writer
2 years 7 months ago

Free Wi-Fi isn’t bringing shoppers into your store, but it’s certainly something they expect once they’re inside. If free Wi-Fi is available, most people will connect to it. For retailers, any ability to capture shopper data is absolutely worth the cost of providing Wi-Fi.

Adrian Weidmann

Access to free Wi-Fi has quickly become an expectation and simply an ante to the shopping landscape. The technology has become relatively inexpensive and easy to implement. Eliminating this from the shopping experience will reflect poorly on the brand and its commitment to its shoppers and customers. Retailers should figure out how to leverage this technology and expectation for their benefit as much as for their customers. What about using local hot-spots for vendors to leverage proximity marketing to provide their shoppers unique content to their mobile devices? Unique access to movie trailers? Unique and innovative DIY project how-to videos with discounts on select items? Come on folks — get creative! There are many ideas to explore. Or you can just fade away like the others …

Ben Ball

Free Wi-Fi service should be an expected part of the store environment. It costs practically nothing to offer and customers connecting to the store’s service (usually automatically after the first log-in) may be more apt to click through on offers that may be pushed to their phone. Of course that activity has to be VERY minimal and non-intrusive or it quickly becomes a big negative.

Shep Hyken

Wi-Fi is expected. It’s not about the customer having the right plan. It’s about whether or not you want to connect with the customer. The retailer needs to stop promoting Wi-Fi as an incentive or perk. It’s now expected.

Lesley Everett

Quite simply, it would be a disastrous move by retailers not to invest in fast Wi-Fi. Although Gen Z (and a significant percentage of the rest of us!) still like to shop in stores, that want to use their technology for checking out pricing and functionality for example. Making this more difficult for them will result in them not using that store, and it won’t take long for the message to get around!

Dan Frechtling

Removing Wi-Fi for shoppers seems to be a losing proposition. In addition to the loss of customer emails that the article mentions, stores lose the opportunity for anonymous data from shoppers that help measure traffic and time in store. There’s also lost marketing effectiveness: Jo-Ann Fabric Facebook ads targeted to Wi-Fi users yield six times the number of store visits.

The business case for in-store Wi-Fi is valid whether shoppers use it or not. Associates use Wi-Fi to look up inventory and product information—even shopper profiles—while helping shoppers on the floor. Devices such as kiosks, shelf screens and mobile point-of-sale (mPOS) use it.

The benefits easily justify the low investment.

Roger Hsieh
2 years 7 months ago

As long as the retailer has internal uses for Wi-Fi such as to connect staff devices, sensors, etc., maintaining free shopper Wi-Fi is a pretty minimal additional cost for configuration, segmentation and security. Even if the shoppers don’t get any direct benefit from the engagement via Wi-Fi, there are numerous indoor positioning and location based analytics that can be supported by existing Wi-Fi without the shopper connecting to the network.

Ed Rosenbaum

Wi-Fi is important and needs to remain IF stores want to retain their business. Customers have come to expect it. If we ran a test with two stores in the same area selling the same items; one having wi-fi and the other not, which store would you expect to have the better business?

Cate Trotter

Wi-Fi is one of those retail experience elements that you may not always use, but you’d notice if it wasn’t available as an option at all. Mobile signals don’t always work well in every store and if retailers are going to push people to use their app or download a code or interact with a display then they need to provide the infrastructure to enable shoppers to quickly and seamlessly do that. I’m not sure the cost savings would amount to enough to remove free Wi-Fi as a customer benefit. There’s also the question around what other information an in-store Wi-Fi connection can gather/support. It may be that having these networks turn out to be far more valuable to retailers.

Phil Rubin
2 years 7 months ago

While there are a number of retailers that still do not offer in-store Wi-Fi, the research and the common sense to recognize that doing anything that degrades an in-store customer experience is only going to help retailers fail faster should be enough to answer this question. There are all kinds of benefits to retailers and customers with offering Wi-Fi, including in-building penetration of cellular signals and the ability to actually know who’s in the store (not that retailers view this as a priority LOL).

The future of retail and the future of loyalty revolve around more than just the right goods…the future depends on a better customer experience. Retail totally fails at this today as an industry and we are going to see closings, bankruptcies and declines in valuations continue.

Craig Sundstrom

Pennies saved, customers lost? Like anything else, this service should be subject to cost/benefit analysis — at least as best as one can given the vagueness associated with measuring the latter — but I suspect any business that thinks the small costs savings will make a difference is so close to unprofitability that its days are numbered anyway. Giving customers even more reasons NOT to come in seems like an odd idea.

Ricardo Belmar
This shouldn’t even be a question in my opinion. Wi-Fi is simply table stakes for retailers today. I don’t see this changing even if mobile plans become 100% unlimited and low cost. Best example to prove this — think about how many stores you’ve been in where you could not get a good quality signal. Especially in big-box stores like Target and in urban centers with older building structures. Gen Z and Millennial customers who expect to use their mobile in stores will continue to rely on Wi-Fi in these scenarios. The most critical element here, however, is that bad Wi-Fi is infinitely worse than not having Wi-Fi at all. Too many retailers deliver guest Wi-Fi as an afterthought and the quality is poor. I’ve conducted many store tours through New York City and other locations just to test the quality of guest Wi-Fi in stores throughout the city and the variation is amazing! How you install Wi-Fi in a store matters with respect to end-user performance and how you manage and control the performance… Read more »
Pavlo Khliust

With the rise of the new services, like in-mall navigation, introduced by Apple during WWDC2017, similar features of Google maps, Beacon technology, it is only a matter of time, when retailers will approach in-store navigation for personalized shopping experience, all of it received through a consumer’s smartphone. Removing such convenience feature can negatively impact the very experience, retailers are constantly fighting to improve. Instead, make it better, faster and more convenient for your customers, and you will be able to benefit from the upcoming technology in the nearest future.

gordon arnold
Are we confusing customers, shoppers and shoplifters in this, and other discussions? To know what I am referring to, we simply need to spend time on the floor and observe what all the people are doing. Employees spend an outrageous amount of time communicating to and from non-work contacts for non work-related purposes. Companies pay twice for this in lost man hours and the costs of Wi-Fi. Three times if you include the number of aggravated customers that leave and/or never return and tell their friends what a nightmare shopping experience they had. Then there are the shoplifters that communicate to accomplices in and out of the store to increase their odds for success. And finally the consumer that needs to see touch and experience product before buying or reserving online with the competition. Eliminating free online will not stop these and other problems, but the savings in time and money will provide ample return rewards. An alternate solution might be providing frequent shopper club members in good standing that have electronic receipts for recent… Read more »
Brian Numainville

Free Wi-Fi is a basic expectation of shoppers and has become an expectation of a “with it” retailer. I wouldn’t remove it for a minimal cost savings.

Peter Fader

I’m going to go against the grain here: retailers shouldn’t make Wi-Fi an “unalienable right” for all shoppers, but rather it should be a perk that they give to members of their loyalty program. And for those folks it should be fast and free and very effective.

Give shoppers a genuine reason to join the program (instead of discounts), and encourage them to take advantage of it.

Alex Senn

Not sure that retail 100 percent needs the free Wi-Fi, though I will say I have used it on numerous occasions when the signal is weak or I can get a benefit by using it. Certainly retailers enjoy emails coming through their Wi-Fi opt-in page but I agree with Mark that if the usage supports Wi-Fi chances are it makes sense. If you haven’t had Wi-Fi before it might not be that important to justify the costs.

One thing I will say is, don’t just rely on Wi-Fi. If you are going so far as to offer free Wi-Fi, use beacons, understand geo-location, understand what the Wi-Fi can do on the phone, etc. Wi-Fi alone may not be the magic touch, but perhaps that beacon using Wi-Fi can eek out another sale since that customer sees a new relevant offer as they walk around.

"Turning off Wi-Fi in a retail store would provide minimal savings to the retailer and remove a convenience expected by consumers."

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