Retail TouchPoints: Taking Mobile Marketing Beyond Coupons
By
Jeff Weidauer, VP Marketing, Vestcom International
Through
a special arrangement, presented here for discussion is a summary of
a current article from the Retail TouchPoints website.
In
the past 20 years, few technology-driven changes have been more pervasive
than the mobile phone, and today marketers are scrambling to find ways
to utilize these devices. The focus so far has been on mobile coupons,
with some success. As newspaper circulation declines, and freestanding
insert distribution becomes ever more challenging, mobile phones are
an obvious and effective way to drive purchases. Not surprisingly, younger
shoppers are more likely to seek out savings via the web or mobile, and
these are the folks with growing families and a need for greater value.
The
downside of mobile coupons is the back-end cost of redemption, which
makes a successful promotion increasingly expensive. Coupons are also
the most basic of triggers for shopper engagement, with little long-term
loyalty benefit.
The
logical question then is: What’s next? How do we make the most of this
pocket-sized kiosk and provide loyalty-building communications to shoppers?
One
idea is a new service called Aisle 411. Testing now in Springfield, Missouri,
Aisle 411 allows shoppers in store to use mobile phones to get directions
to any item on their list. While this is a great start, it really doesn’t
make full use of the power of a smart phone. Why not an application that:
- Keeps your shopping list;
- Remembers
your purchase history that can be accessed as needed; - Adds
GPS functionality so the phone knows which store you’re heading to and
re-orders a shopping list accordingly as to that store’s layout; - Incorporates
shopper-specific offers based on shopping behavior–and therefore extremely
relevant offers that can influence the shopper while she is in the store.
A
number of consumer packaged goods brands have introduced iPhone apps that
give consumers direct access to the brand and include recipe ideas, nutrition
info and special offers. But the reality is, shoppers are not going to download
all the brand applications that come down the pike. More realistic is an
application offered by a retailer, store-branded and shopper-focused, that
enhances the entire shopping experience, starting from home and the creation
of the shopping list.
The
greater challenge in using technology as a practical tool is ensuring
the accuracy of the data and the ongoing relevance of the offering. Novelty
will drive trial for many, but continuing value is the only way to keep
people using the service or application.
Discussion
Questions: Which apps or other tools make the most sense for retailers
to incorporate with mobile phones? Which mobile technologies will likely
impact the shopping experience over the next year and which are likely
a few years away?
The last sentence of the article says it all; “Novelty will drive trial…, but continuing value is the only way to keep people using the service or application.” The most precious commodity that consumers have is time. Retailers need to treat mobile devices as shopping aggregators and use them to save consumers time, effort, and money.
Mobile devices can serve as cost effective loyalty cards, recipe files, and scanning and check out tools.
Forget the fluff. Consumers don’t have time for it. Most don’t want mobile ads and don’t want to be called or texted unless they request the information. There is little consumer tolerance for push advertising when it comes to the mobile phone.
Apart from the retailer, look for mobile devices to utilize augmented reality to get product reviews, compare prices and learn about substitute products. AR will not be delivered by retailers, but will become a common part of consumers’ lives through their choice.
We are just beginning to see and learn the impact of mobile devices on retail.
Likely I would see the advancement not quite as rapid as most, but it will still expand rapidly.
More than fluff, coupons, gimmicks, apps, etc, I think pure information is the best place to start. Locally, major retailers have begun a simple notification of gas price increases. It’s simple, effective, and broadly used. It’s just an example of information that consumers want, appreciate, and act upon.
All the fancy bells and whistles and apps might be great utilization of the technology, but consumers want information that they can use, use now, and make a difference for them. The definition of that is value.
Just as with the loads of e-mail from Amazon, Borders, Zappos and others I get because they got my e-mail address from an order, soon it will become annoying. I don’t want to know about every offer you have. I want information, not coupons or gimmicks. In the end, I think that’s what consumers want as well.
Retailers that use this medium for opportunities that have a high rate of actionable information for their customers will be most successful and most appreciated by their customers. Retailers that use this medium for low rate-of-return, thinking from other medium promotions and couponing, will soon become an annoyance and have little effect. The scatter gun approach as with newspaper or other medium thinking for a 2-4% return will see, I believe, customer backlash once the novelty wears off.
I’ve gone on record as saying that the merger of digital marketing, mobile, and shopper marketing will be as big as retailers, manufacturers and most of all shoppers all want it. Here is my blog posting.
Since apps are still in the early days and smart phone penetration is still building, I also feel the tipping point is a few years out but marketers should start laying track now.
The use of the camera to scan a product barcode enables customers to get product information. If we use GPS to put the customer in a particular store, then coupons and loyalty can be triggered. Using the camera and GPS together enables augmented reality, so consumers walking down the street can see reviews and promotions on storefronts. It’s all very powerful and available today. Watch for Google to make the next big move.
My Master’s Program students range in age from 23 to 29 years old. They are all international students, but I don’t know if that makes a difference. They use smartphones of various sorts. If I were to describe their use of the smartphones versus those of an even slightly older demographic, I would say that these twenty-somethings use the smartphones as a tool for daily living versus others who use it as a tool for information. The way they use their phones is well beyond my scope of comprehension. But, they are the trend, I am not.
Marketers must start thinking differently. Smart phones ultimately will not be merely a substitute venue for FSIs, coupons, TV ads, and direct mail. Recipes will not do it. This is a very different dynamic. The power of the user to reject these traditional marketing tools will eventually make mass marketing as we know it obsolete. Unfortunately, marketers seem to be trying to fit a square peg in this very dynamic tool.
There’s potential here, but we’re years out.
The iPhone experience would suggest that the correct business model here is the smartphone applet, downloadable by customers themselves. This puts consumers in the driver’s seat and provides incentives for retailers to create tangible value. Once retailers move away from trying to keep the customer in the store for longer periods, and move to becoming more valuable, the dynamics will shift. This could be really exciting.
I think something that allows me to make as an informed decision in the store as I would online will be successful.
I have to say I’m a regular user of the Amazon app for the iPhone. I take a picture of a product and I immediately learn the price at Amazon and I can read the reviews right from the store.
Most of the time I end up buying the product in the store, but a couple times where I got poor service I happily bought it from Amazon while standing in the store.
The key is to design from the customer’s vantage point and not the retailer’s.
I am a huge believer in 2D or QR codes for retailers. I recommend others look into it. QR codes at the point of sale could provide shoppers with an almost infinite variety of purchase support. The consumer uses a smartphone to take a picture, it’s decoded by a QR app (built in on Android driven devices and available free for iPhone and Blackberry), and instantaneously the additional content is displayed.
Retailers can use this to link to product demos, customer review sites, manufacturer support links, additional specification sheets…the opportunities are endless. In grocery, the application could be toward recipes, or shopping lists, all of which are beyond the mobile couponing aspect.
At ConsumerX, we start with the idealized experience. In this case, which essentially is a grocery occasion, our intrepid customer is shopping with a list. She is balancing influential messages received through various sources–broadcast, print, the weekly circular, friends ideas and recommendations–with the emotional drivers of doing what’s right for her family and herself.
The potential for mobile in the shopping experience lies in understanding her and what drives her behavior. Odds are, she has spent a good deal of time reconciling all the offers and clipping paper coupons. How will, at a minimum, mobile mimic that (so she can easily migrate her behavior to a new construct) and more importantly, how will mobile make it better in ways she cannot imagine?
The article puts the opportunity at the feet of retail stores and I think this is spot-on right. Retailers know more about us than we do (or perhaps they realize) or any single brand can. We know that and the average consumer knows that. As a matter of fact, the average consumer, would LOVE it if we used all this information to make her life, not just easier, but cooler, nicer, better.
Combine the insights gleaned from thoughtful, attentive qualitative research, with the broad and deep data from loyalty programs and point-of-sale data and work with consumer packaged goods brands on her behalf.
Jack Dorsey, the co-founder of Twitter has launched Square, a company that uses the iPhone as a cash register (that cannot take cash). This is great–for small retailers, iPhone enthusiasts and, well, Jack Dorsey.
Where’s the app for the customers that will let them design their own shopping experience? Hell, just keeping track of hundreds of coupons is a cottage industry.
So, come on retailers, let me access the information you and the brands have about me and what you’re willing to offer and I’ll try new stuff, buy more from you and keep coming back.
In the mobile space, there is a lot of interest with barcode scanner integration right now. Yet in order for retailers to accept a coupon from a consumer’s mobile device, they must own a smartphone–which describes approximately 20 percent of all the mobile phone users right now. Smartphones are certainly on the rise, however, and the idea of mobile coupons will continue to become an area of interest for both consumers and retailers alike.
On the other hand, a mobile device also lends itself really well to in-store feedback. If an individual has the capability to text from their phone, a retailer can target them for a quick mobile survey. For example, a retailer can ask customers (via store signage) if they are visiting the store based on a specific sale or current promotion. Customers simply text back their response, as well as their e-mail address, for a chance to win a prize. It allows retailers to receive timely feedback at the POS, helping them identify customer motivations in order to better target them in the future.
Beyond just learning more about their customer behaviors or sentiments, retailers can also prompt their customers to text in their e-mail address to be sent a web-based customer experience survey invitation. With such prompting, customers can actually be very receptive to providing feedback, especially if there is an incentive involved–such as a coupon or raffle drawing.
Several retailers have already begun to implement such mobile survey strategies and are experiencing great customer buy-in. Texting on a mobile device is simple and convenient, and eliminates the need for a customer to remember a certain web address to take the survey at home. Plus, having customer e-mail addresses gives marketers the chance to target their key audience in a more personalized manner.
Any application that makes shopping decisions easy would be a hit. However, app developers need to keep in mind simplicity and ease of use while designing these.
Recently, we had piloted an application which allows you to try on lipstick shades and earrings. Some of the other applications could be uploading your shopping list and finding out the way in the store, checking if item is in stock or not in the store, trying out a wall frame/decor on a picture of your wall, and numerous others.
Retailers also need to develop apps which would engage customers and make them come to the store, or apps that help to create a grocery list based on task, for example, baking a cake or going for a picnic, and others.