Living Loyally

Remote digital payments for goods and services totalled $167bn in 2010, and is predicted to exceed $633bn by 2014. As mobile technologies continue to evolve, organisations should see a significant opportunity to understand how to unlock and increase major revenue potential through mobile customer relationship management (mCRM) activities, whilst also improving the customer experience.

Long gone are the conventional days where bricks and mortar stores were the high touch point in a sales cycle, and the only venue for building consumer loyalty. Consumers today have greater expectations for a personalised, enhanced shopping experience through multiple channels and value-added services. They not only require but demand real-time, customised rewards at various stages of the sales lifecycle. This in turn creates an opportunity to directly engage with customers and build brand loyalty through mobile marketing. But how are organisations addressing these needs in the race for mobile domination?

Channel growth
Retailers in particular have an immense opportunity to become drivers of mCRM and mobile marketing usage and adoption through couponing. According to research company Aberdeen Group, 57 per cent of retailers are seeking new sales and service channels, and the consumer’s mobile phone has emerged as a “channel growth” opportunity for engagement, while increasing revenue options for retailers. In addition, a ComCost study found that 52 per cent of smartphone users make purchase via mCommerce channels because of coupons.

Mobile couponing creates value for both customers and retailers through its ease of use and management. Currently, in the US, mobile couponing is a nascent business driver but it’s less popular in Europe. Imaging walking down the streets of Manhattan and receiving SMS for discounts as you pass stores and restaurants. Retailers on the UK’s high streets need to understand that location-based marketing and couponing is another powerful mechanism in the marketing mix. There are a lot of benefits, but retailers need to connect the promotion to the purchase in order to track a return on investment which is a capability that is now available in the mobile environment. This is key to companies gaining more confidence and investing money in this channel.

In addition to retailers, consumer packaged goods (CPGs) companies are increasingly trying to find ways to communicate with the consumer through mobile. Mobile enables CPGs to connect directly with consumers in a more valuable way than traditional channels. Traditionally, retailers have “owned” customers’ in-store purchasing data. Through the use of mobile, CPGs can now directly reach consumers but also derive point-of-sales data to optimise marketing and enhance the overall customer experience.

In addition, CPGs are trying to build brand loyalty collectively instead of through individual brands. In a highly commoditised industry offering a myriad of products, the major CPGs of the world are using mobile to increase customer value across several brands at once, as evidenced by the TV advertising in Europe by Procter & Gamble, Unilever, and others.

Correct implementation
One of the challenges in the UK is that large retail chains focused heavily on eCommerce during the boom, but made the mistake of not having enough stock in the store. They didn’t recognise that building customer loyalty needs to be part of a holistic picture in order to retain loyal consumers. Today, consumers want a multichannel option, to make purchases on their mobile, the web and in store.

Customers will be loyal if they’re offered these services, but in a meaningful way that is useful to the consumer, otherwise it becomes valueless. A recent study from ATG Consumer Research established that 30 per cent of consumers use three or more channels, 20 per cent of all consumers 18 and over use their mobile to browse for products monthly. If it works, consumers will use it.

In 2012, we will see companies accelerating activities and experimenting with mobile in order to build better loyalty programmes. Mobile marketing, specifically through couponing, will be the catalyst for growth in helping the consumer make choices by offering value. The channels may have changed but the message is still the same. The technology exists to engage more and more with consumers at their level, but it’s about finding the correct implementation.

Paul Bates is global business development director at Sybase 365