Mobile Spotlight: DR Marketers Find Smarter Ways to Target Smartphone Shoppers1 Sep, 2011 By: Nicole Urso Reed Response
Smartphone users search, compare and purchase on their phones. And the trend is only beginning.
Holiday shoppers are well equipped this year. With smartphones and tablets, an artillery of apps, mobile coupons, quick-response (QR) and bar code scanning and flash sale websites, they can click-to-buy gifts for everyone on their list with maximum efficiency and savings.
Last year’s holiday retail sales were surprisingly positive, particularly in E-commerce where spending was up more than 12 percent, according to comScore. Cyber Monday sales outpaced Black Friday, and surpassed $1 billion for the first time, setting a record for the most online spending in a single day.
Smart devices provided the tools to scan product codes and compare prices and product features at various retailers, both online and brick-and-mortar, putting consumers in control of finding the best value for their money in the down economy. Daily deal websites, such as Groupon and Living Social, and online flash sales from websites such as Gilt, RueLaLa and Hautelook, provided further opportunities for shoppers to seek out high-quality goods at discounted prices.
The E-commerce and mobile shopping trends that resulted in a celebratory end to 2010 continue to flourish in 2011, and are driven by the constant increase of smartphone adoption. According to MobiLens, comScore’s mobile research division, 78 million people, about 33 percent of the 234 million U.S. mobile population, used a smartphone to view retail content during the second quarter of 2011, up 8 percent compared to the first quarter.
All Systems Go
As the 2011 holiday retail season quickly approaches, optimizing a mobile strategy is top of mind for many marketers. Ken Barber, vice president of marketing for mShopper, a company that provides mobile commerce solution for retailers, says that one of the most important things a company can do is create a mobile version of its website.
“An optimized mobile website makes life a lot easier for mobile shoppers and can produce conversion rates that are up to 10 times better than a non-mobile-optimized site,” says Barber. “A mobile website knows what device a shopper is using and presents the properly formatted site. But it also adjusts for the unique needs of the mobile user. It typically has fewer images so it loads faster, bigger buttons for shoppers on the go, fewer buttons, mobile shoppers need something simple and quick, and requires less data entry — this is tough while moving.”
mShopper also provides cart abandonment solutions to reconnect with prospective mobile customers. If shoppers have entered their contact information and then leave without completing their purchase, the retailer is able to contact them automatically by E-mail or text message.
“They can further decide how soon after the abandonment the automatically-generated reminder email will be sent,” says Barber. “The reminder E-mail will contain a link that will bring shoppers directly back to the page in the checkout process where they left. This feature is especially important with mobile shoppers who may be trying to complete a purchase but lose reception temporarily.”
mShopper offers retailers three options for managing product fulfillment.
“We can send the order details directly to their existing E-commerce shopping cart via an API,” says Barber. “We can notify the retailer that an order is ready for processing and give them a link to our platform to process it into their E-commerce cart manually. Or we can use our order-processing center to manually place the order into their E-commerce cart. With all three options, the order shows up in their existing order database with a tracking tag that identifies it came from their mobile store.”
Optimizing a website for mobile shoppers parallels many of the fundamental marketing tactics of traditional direct response television commercials. The messaging is short, simple and enticing. There’s immediacy, compelling offers, and the messages are targeted and tested in various geographies.
“Direct response customers are no different than other shoppers and have their phones on them at all times,” says Barber. “Many are using their phones while watching TV. An easy way to connect with them is to use your TV spot to encourage them to, ‘Text DEALS to 12345,’ your short code, to receive a link to purchase the product directly from their phones. Almost immediately, shoppers receive a text message with a link that opens up their mobile web browser and allows them to enter shipping and credit information and make the purchase. They never even had to leave the couch and turn on their computer. An especially effective tactic for DR marketers would be to offer a special offer if they make the purchase from their phone.”
The As Seen On TV Official App is another avenue to integrate mobile retail into an existing DR campaign. The app is free to download and available on both the Apple iOS and Android OS. It’s also free for advertisers to set up their products through. When it launched in October 2010, Brad Feldman, the app’s developer, had high expectations that the new DRTV portal would attract marketers looking for an additive revenue stream for their As Seen On TV products. Consumers wouldn’t have to remember an 800 number or a Web address. They’d simply click-to-call or click-to-buy an item after viewing it on a commercial or visiting the app directly.
“We’re not a retail shop,” says Feldman. “We’re a service for the industry.”
Feldman says that he built the app for the DR industry as a tool to integrate and test mobile marketing, but quickly learned that consumers expected a robust As Seen On TV retail experience. Consumers liked the concept, but he needs to get more DR marketers to get on board with their products. “Television is so big and makes so much money that when you talk about additional distribution, [some marketers] see it as a very small portion,” he says.
To help ease the transition, Feldman continued to enhance the app with more features for the consumers and fulfillment logistics for advertisers. Now, when customers using the app click to call, it goes directly to the marketers’ customer service center. The app works juts like a call center using the already-existing infrastructure of the marketer — and Feldman has also integrated HTML5 and mobile optimized websites (www.asseenontvinc.com) into his offerings.
Whether or not mobile advertising presents a big enough opportunity to invest is up to each marketer to decide, but it’s clearly picking up momentum. According to comScore’s “State of the Mobile Industry” report, U.S. mobile advertising is projected to reach $2.5 billion by 2014.
Blurring the Lines
Smart devices continue to merge the worlds of E-commerce and brick-and-mortar retail. Connecting with users on their smartphones is a compelling way to drive them back into a store. Consumers scan QR and bar codes in a store to seek a better deal online or at a neighboring retailer, but they’re also using online research before visiting a store to make a purchase.
According to financial services company Credit Suisse, 87 percent of prospective customers research products online before buying them at a retailer. Brick-and-mortar sales influenced by consumers doing online research will reach $1.1 trillion by 2010, which is about half of all retail sales.
Since consumers are looking at all avenues to find the right products at the right price, marketers need to be present at each stop and looking cohesively at a multi-channel marketing campaign. Amazon and other major online retailers are ramping up their customer service and employing some of the tactics of traditional retail. They use Twitter and Facebook to communicate with consumers directly, answering questions and thanking them for their loyalty. They’re also quashing one of the biggest aggravations of shopping online — shipping charges.
According to a comScore survey, 84 percent of consumers stated that free shipping was either somewhat or very important when making a purchase online. With Amazon Prime, consumers pay $79 annually for unlimited two-day shipping. Zazzle, a website where customers make personalized products such as T-shirts, mugs and greeting cards, recently introduced Zazzle Black, a membership program that offers unlimited free shipping on qualified products for $9.95 a year, or unlimited two-day free shipping for $39.95 a year. Zappos, the shoe and apparel online retailer that notoriously built its brand on making people happy, offers free shipping on purchases and returns in addition to live help on its website.
The free shipping trend is also influencing return policies on flash sale websites. Gilt offers its customers free return shipping with a refund to the original form of payment. Hautelook recently introduced free return shipping for orders refunded with Hautelook credit.
Seeking out retailers and local businesses on a smartphone is often influenced by personal recommendations by friends, and friends of friends, on social networks. According to Nielsen, Americans spent nearly a quarter of their time online on social networks and blogs, a 15.8-percent increase from a year ago. Social networks are the No. 1 destination, up 43 percent in June compared to June 2010.
The location media company, Where, helps users to connect with local business through its Where app, which has more than 4 million users.
“The application is really about helping consumers find great local places,” says Dan Gilmartin, vice president of sales and marketing. “It’s a Pandora for places or a Netflix for places. It gets to learn about you, your interests, your likes and your dislikes and makes recommendations on where to go based on that information.”
The app is powered by a relevancy engine and an algorithm that also weights social recommendations in order to surface places that a user might like based on what people with similar interests liked too.
The relevancy engine also powers Where Ads, a mobile ad network that reaches 53 million consumers across the United States. Developers plug in Where Ads in order to serve up relevant adds to monetize their apps.
“The ad network takes into account a lot of that similar information about what you’re engaging with, different businesses and place pages that you may visit and uses that information to deliver relevant advertisers to you when you’re using the application,” Gilmartin says.
There are about 400 publishers plugged into the performance-based ad network. Performance is broken down into two parts: A primary click is when a user clicks on an ad to view a business page, and a secondary click is when a user takes further action to call or look up directions.
Real-time public data is also used to target users based on a variety of topical information, such as weather, flight delays or sporting events. The company ran a campaign for Halls cough drops. By looking at the national flu index, public data provided by the Center for Disease Control (CDC), Where delivered ads for Halls cough drops wherever the flu index spiked within geo-fenced regions so that the ads were only seen by users who were close to a participating retailer.
“With respect to traditional retail and online shopping, it’s really leveraging the technology,” says Gilmartin. “Whether it’s location, whether it’s local search, whatever it may be. For us it’s really about relevancy, leveraging that technology to help drive that consumer to wherever that merchant is that they may be looking for.”