M3 Mobile Marketing e-Newsletter (July 2010)

 

Why iPhone 4 will change mobile commerce as we know it
By Giselle Tsirulnik

Industry experts said that the new iPhone 4 is going to change the face of mobile commerce, and both brands and retailers need to adjust their strategies accordingly.

The technology behind the new device is based on the same operating system powering Apple’s iPad tablet, which has already reinvented the mobile commerce experience. With mobile commerce sales reaching $1.2 billion in 2009 and projected to almost double to $2.2 billion this year, retailers need to take advantage of the new iPhone and make their mobile experiences more gripping.

“There are two things that the iPhone 4 is going to do,” said Scott Dunlap, CEO of NearbyNow, Mountain View, CA. “First, this is an HD phone. The clarity of the screen, plus the ability to take high-resolution pictures and HD video, is going to raise the bar on the mobile visual experience.

“I think it is finally at a point that even the Rolexes and Tom Fords of the world will be pleased with how the quality of their products will be represented,” he said. “Second, the iAd network that comes with iOS 4 is about to change everything we know about mobile advertising, and in turn, mobile commerce.

“The ads themselves are as powerful as apps, and can be mini-networked games, video channels and location-based trivia contests. You could even make a purchase directly from an ad. It's the first mobile ad network to have both reach and rich ad units. Mobile banner ads will instantly become archaic, and all of us will have to rethink mobile engagement.”

HD display

Apple’s new Retina display is the highest resolution display ever built into a phone, resulting in super-crisp text, image and video.

In addition, iPhone 4 features a 5-megapixel camera with LED flash, HD video recording, Apple’s A4 processor, a 3-axis gyro and up to 40 percent longer talk time — in a beautiful all-new design of glass and stainless steel that is the thinnest smartphone in the world.

IPhone 4 comes with iOS 4, the newest version of what is undoubtedly world’s most advanced mobile operating system, which includes more than 100 new features and 1500 new APIs for developers.

Creating buzz

As we all know, Apple is a master at creating buzz around its new devices.

Walking by SoHo’s Apple store on June 24 was absolutely impossible. There was a huge mob of people waiting to get in to pick up their phones.

Apple reports that it received 600,000 pre-orders for the device on just the first day alone. That is 10-times more than it did on the first day the iPhone 3GS became available for pre-order.

The slogan that Apple is using for the iPhone 4 is, “This changes everything. Again.” Most industry executives agree, especially in the case of mobile commerce.

“It’s not only the device that will alter mobile commerce, it is the underlying iAd platform which allows for in-app purchasing,” said Neil Strother, Kirkland, WA-based practice director at ABI Research. “Assuming this process is as seamless as promised, and consumers can easily make purchases within apps, then this could be an important step forward for mcommerce.

“Given Apple’s ability to deliver a high-quality user experience and attention to detail, it’s a good bet this will work well,” he said. “It’s important to remember too that this purchase capability will extend to other devices running iOS 4, such as iPads and iPod touch devices.

“So, mcommerce should not only get a boost from users of the latest iPhone version, but also from users of these other devices as well.”

iPhone-driven improvements

Marci Troutman, founder/CEO of Siteminis, Atlanta, said that three quick iPhone-driven commerce improvements will be:

1. Better quality social media interactivity, which will improve ad marketing revenue

2. More sophisticated OS and screen resolution, which will improve the gaming and entertainment experiences, leading to more revenue through download and content purchases

3. More APIs and developer tools, which will improve quality and the number of new applications available for downloads creating revenue through the download and use of iAds through the applications

“Longer term impacts are OS speed, ability to multi-task, battery life improvement, camera quality and higher screen resolution will lead to faster emergence and adoption of technologies such as augmented reality, bar code scanning and near field communications - which all create revenue streams,” Ms. Troutman said.

“Of course, the caveat is that this is all for just iPhone users,” she said.

Apple’s iPhone OS 4’s new multitasking feature offers users a new way to quickly move between applications. It provides developers seven new services to easily add multitasking features to their applications as well.

New services include background audio, so applications such as Pandora can play music in the background.

Additionally, the VoIP service lets applications receive a VoIP call even when the iPhone is asleep or the user is running other applications.

Bringin' sexy back

Just as brands and marketers flocked to the App Store for the iPhone and its successor, the iPhone 3GS, the same will hold true for the new iPhone 4.

Let’s face it. There is something sexy about an iPhone application. And as the iPhone gets smarter, the whole application concept becomes ever-more appealing.

Retailers and brands recognize this, as already mobile commerce giant eBay has revamped its iPhone application for the new iPhone 4.

With a new look and feel, the eBay application is even more compelling.

“Apple's first iPhone was revolutionary to the smartphone market, and as it continues to release more sophisticated and user-friendly devices, mobile commerce will become more and more a part of consumers' every day routines,” said Nick Taylor, president of Usablenet, New York.

From a retail perspective, the iPhone 4 is a new opportunity to increase sales.

The phone will fuel smartphone adoption, which will drive mobile commerce activity.

“The new iPhone 4 provides more fuel for consumer smartphone adoption, at a time when distribution rate growth is already more than impressive,” said Kevin Ranford, director of Web marketing at 1800Flowers, Carle Place, NY.

“The iPhone 4's functionality specifically favorable to mcommerce is the multi-tasking functionality so that shoppers can make a purchase while still engaged with another app, and the sharp Retina display making merchandise images pop,” he said.

 

A blueprint for luxury brands to go mobile
By  Mickey Alam Khan

With the economy on the mend – gullible enough to believe the data – it’s time for luxury brands to get out of hibernation and seriously launch mobile marketing and commerce efforts.

Luxury brands typically are the cautious sort, but this is not the time to waffle or waste – today’s consumer is online, mobile and in control. Luxury marketers need to work with ad agencies, ad networks and mobile marketing and commerce firms to begin incorporating mobile into multichannel efforts in time for the upcoming holiday season.

Here is a roadmap to help luxury brands with their mobile marketing and commerce efforts.

Why Mobile for Luxury

* The audience is on mobile devices

* One out of two mobile phones in use by next year projected to be Web- and application-enabled smartphones

* Consumers don’t simply talk and text on mobile phones – they browse, shop and buy

* Mobile devices give what consumers seek in the relationship with brands – control

* More content consumption on mobile – news, in particular – offers opportunity for contextual advertising

* Part of the multichannel experience

* Steve Jobs – the No. 1 influencer today of product design, marketing, commerce and customer experience

What Consumers Want from Mobile

* Ease of communication with friends, family, coworkers and brands

* Ability to search, shop and buy on the devic

* Receive SMS-based offers, updates and retail traffic drivers when opted into mobile CRM programs

* Browse mobile Web sites and applications for product information, store location, pricing, inventory availability and in-store merchandise reference

* Same experience as online

* Rich media experiences on tablets such as the iPad

Crafting a Mobile Strategy for Luxury Brands

* Study audience habits – buying and media-consumption patterns

* Is the product or service suited to mobile marketing or mobile commerce?

* Discuss channel conflict issues internally

* What have you done on the traditional Web?

* Will the luxury experience and brand values translate well to mobile?

* Marketing or sales, or both – make objective clear

* Mobile is a medium comprising many channels, but it also serves well as a traffic driver to retail or online experiences

* Dedicate the resources – HR, budgets, time and patience

Luxury Marketing with Mobile

* Establish a mobile-friendly Web site, even if it’s a simple landing page and a couple of other pages reflecting the brand values and core information

* Apply for a common short code to begin SMS marketing that ties in with the brand’s overall loyalty marketing efforts

* Run targeted mobile advertising on reputed publisher sites and across mobile ad networks with banner ads, rich media units and video

* Mobile search optimization – work with Google, Microsoft and Yahoo

* Deep pockets? Build a full-fledged mobile site and application with shopping and transactional capability

* Use retail stores and catalogs to drive mobile database buildup

* Employ SMS to opted-in consumers to push traffic to stores

* Promote short code signup and application downloads in print, television, mail, online and catalog ads

* Repurpose runway material on mobile to extend the luxury experience

Brands That Get Mobile

Tiffany & Co. marries mobile with interactive to sell engagement rings

Ferrari Maserati dealership taps mobile for added customer touch point

Chanel taps iPad’s unique capabilities to showcase watch collection

Jimmy Choo taps mobile to make print ad more interactive

Rolex taps mobile to make rint ad more interactive

Rogers & Hollands Jewelers mobile program drives repeat business

Gilt Groupe iPad app comprises 3 percent of sales in first 2 days

Mobile is a wrap for Diane von Furstenberg

Bergdorf Goodman enters mobile commerce

Nordstrom, kate spade, T-Mobile use mobile to boost in-store traffic

Waterford Crystal extends brand to mobile with new app

Gucci enters mobile commerce arena with one-of-a-kind app

Bloomingdale’s fall fashion campaign taps mobile to engage customers in-store

Tiffany & Co. targets luxurious ladies via smartphones

Dolce & Gabbana dresses marketing strategy with mobile

Again, Why Mobile for Luxury – and Why Now?

* Mobile enables luxury brands to reach consumers at each step in the marketing funnel – awareness, trial, persuasion and loyalty

* The consumer is already on mobile – don’t fall too far behind

 

Successfully creating a brand love affair through mobile marketing
Source: RCR Wireless News

More than 90% of the U.S. population has a mobile device. In fact, in the U.S. today, mobile phone penetration exceeds cable television, Internet access and PCs in the home. It is often the first thing a person looks at upon waking and the last thing they look at before going to sleep –especially among teens. A recent poll of 1,500 teens found 68% prefer communicating via SMS. It’s no wonder, then, that marketing and advertising firms are in a hurry to take advantage of the ever-connected consumer.

But this rush of activity has created its own challenges, including weak marketing strategies, mobile SPAM, opt-in confusion and, most recently, legislation to protect consumer privacy. A draft congressional bill proposing much stricter regulations on opt-in and opt-out consent for all forms of targeted mobile marketing is raising concern from the marketing and advertising industries, especially with groups like the Direct Marketing Association. The bill would require notice and consent from an individual prior to any collection, use, or disclosure of information for any purpose..

While the bill will likely undergo many edits before a final vote, the concerns it raises speak to the broader importance of evolving mobile marketing from the “test and explore” stage to a mature industry that thoughtfully and connects companies with their target consumers.

Faced with the growing concerns over privacy and an audience that is hesitant to give access to their mobile numbers in the first place, mobile marketers cannot afford to forget the basics of marketing – personalization, engagement and voice. But today, many campaigns still attempt engagement by throwing out random deals, mobile coupons and more just to see what sticks. It’s important, then, for the mobile marketing community to turn back to the basic principles and adapt them in the context of personal and valuable campaigns.

First, mobile marketers need to ask if the offers they are sending to consumers are relevant to that audience. I have a friend named Lorraine who is an avid golfer and watches all of the PGA tour events. She always complains to me that she doesn’t think she can handle one more “little blue pill” commercial. We have a laugh over it, but these advertisers are doing the best they can with the demographic – men of a certain age – and the medium – television. Do these ads keep my friend from watching tour events? No. But imagine if she started receiving these messages on her phone. While perhaps taking less time and money to implement on the front-end, mass marketing without personalization can actually cause more harm than good as, one misstep on a device as personal as a mobile phone can turn the consumer off from that company’s messaging for good.

Done correctly, however, targeted messaging can greatly increase your success rate. Think about someone who has signed up to receive mobile coupons for pizza. As a marketer, you can blast out a coupon for two supreme meat pizzas for $14.99 to all of your subscribers. The person who, every Friday, orders a large, thin-crust veggie pizza, will probably not be too interested. On the other hand, you could use the ordering data you have to target that customer based on their past orders and send them a coupon for something they may actually want to purchase – which is not difficult to do if your mobile providers’ platform is integrated with your other data sources. And it is this level of personalization that drives opt-in and usage.

Second, consumers today expect value from the companies they allow to reach them on their mobile devices. Traditional direct marketing tactics don’t work with mobile for a number of reasons, including privacy issues and user experiences. Treating consumers like walking billboards will only force them to regret their decision to opt in to your campaign, and make them opt-out. And once they’ve opted out, the chances of getting them back in are slim to none. Marketers have one chance to deliver a message that their audiences will consider valuable. To attract and retain customers to your programs, you should offer them something that’s not a hard sales pitch. Store locators, contests, loyalty programs and voting and polling are a few examples of this. Allowing your customers to perform service related tasks (like checking their loyalty rewards balance via text message) leaves them much more open to receiving sales offers.

Finally, in a socially driven environment, marketers and advertisers can benefit more from a two-way conversation than just pushing out content – especially to the mobile consumer. Your customers’ experiences – good and bad – are no longer contained to a small social circle. With the advent of social media sites like Twitter and Facebook, and with the proliferation of online product and service reviews, it’s very difficult to control the flow of information around your brand – and it’s even harder when the information is negative. A smart mobile strategy incorporates customer feedback through methods like mobile click to chat and mobile surveys. For example, shortly after purchasing a new phone, you receive a text message welcoming you to the company and asking a question about the service you received in the store. Depending on your reply, you’re sent a few other questions in order to gauge whether your experience was positive or negative. And then, if your experience seems to be negative, you’re prompted to reply chat, which connects you to a customer relations representative via an SMS chat session to clarify or resolve any issues you had. By giving consumers a voice, they can provide feedback on their experience with the brand and feel more engaged in the interaction.

A successful mobile marketing campaign employs a mix of tactics that provide consumers with value and a personalized experience. By thoughtfully and carefully engaging the consumer on their mobile device, companies can have the ultimate access to the attention and pocketbooks of the connected consumer and less concern over privacy policies designed to protect consumers from irresponsible mobile marketing campaigns.

Mobile marketing cooks up profits for Frisco-based Scotty P's burger chain
Source: The Dallas Morning News (Cheryl Hall)

Gretchen and Don Reed hadn't planned to eat at Scotty P's one recent Friday.

But she got a text message at 10:30 that morning offering a buy-one, get-one hamburger if she showed up between 11 a.m. and 2 p.m. at the location at Preston Road and Forest Lane where the couple regularly dine..

When they arrived, Gretchen showed the text message on her phone to the cashier and scored a free burger for Don.

"It always brings us in," she says. "We were going somewhere else, and we changed our minds. We love the food."

By "it," she means occasional text messages sent by Scotty P's offering a BOGO or another food deal. But "it" always comes with a catch: It has to be used at lunchtime on the day the message is sent.

Scott Pontikes put on this test for The Dallas Morning News to show what typically happens when the founder of Frisco-based Scotty P's uses an automated, mass text messaging service.

In this case, Pontikes (pronounced Pon-tee-kez) sent out texts at 10:30 a.m. to 64 customers who have designated the Preston-Forest unit as their Scotty P's location of choice.

The first customer arrived at 11:15 a.m. with his text message on his phone in hand.

During the four-hour promotion, 11 text-toting customers showed up, each with at least one other person in tow. They spent nearly $200 – money the restaurant probably wouldn't have gotten otherwise.

Big deal?

Well, yeah, says Pontikes, when you consider that he paid less than five bucks for the text service and got a 17 percent redemption rate. The only other hard dollars were the cost of making 11 burgers.

"I was pleasantly surprised," he says after tallying the register. "I didn't really expect much on a Friday at the beginning of summer."

Guinea pig

Pontikes started mobile text marketing in January when his friend Brad Herrmann asked him to be a guinea pig for the new service.

"Scott picked it up and ran with it," Herrmann says.

Scotty P's has been a Frisco institution since Pontikes opened his first burger outlet in 1999.

Pontikes, who's 42 and holds a degree in hotel restaurant administration from the University of Houston, uses social media, e-mail and texting as a way of life.

He points out that people often don't know where they're headed for lunch until they're leaving the building.

"Then everybody has the same question: Where do you want to go today?" Pontikes says. "We want to inspire you to decide on Scotty P's."

 He typically gets a 12 percent to 15 percent response rate and has a total of 900 people signed up to receive texts. Most of the texters are in Frisco and Plano.

The Preston-Forest location is the chain's newest and has the fewest texters signed up.

Pontikes says he wants to build up to about 2,000 participants: "Rather than having a list of 20,000 and getting 2 percent [redemption], let's just have the people who really do want the deals.";

He can target one restaurant or all seven.

Rain and eating lunch out aren't a winning combo. So one recent drizzly morning, Pontikes sent BOGOs to texters systemwide. Net sales (after the cost of the free burgers was subtracted) from the promotion was nearly $1,200 from less than $60 worth of texts..

"That's huge for a small business like ours, especially in such a short window," says Pontikes, whose chain grosses under $8 million in annual revenue.

He doesn't want to turn free hamburgers into spam, so Pontikes doesn't do text offers more than once a week. When he does, he has to be creative, since he's only got 160 characters to work with.

"I like technology. But I don't know how to write in HTML or any of the stuff that the really smart cyber guys do," Pontikes says. "But I know how to text. It takes me five minutes."

 Once he taps out his message on his computer or iPhone, Pontikes texts it to his mobile vendor. In seconds, his text is disseminated to everyone on each of the targeted locations' lists. He can limit the number of texts per restaurant.

Pontikes says there are other services offering text marketing. But what he only pays 7.5 cents for each of the messages he actually sends, instead of paying $200 a month whether or not he uses the service..