Beyond online – Australian retailers must embrace mobile
From the hornets’ nest that was stirred up at the beginning of this year by Gerry Harvey’s call for a 10 percent GST to be slapped on all overseas online purchases under $1,000, I have read many articles around the need for retailers to get wise online. What I have not seen so much though is a discussion of mobile and the fact that retailers must start to increasingly embrace mobile channels or they will quite simply not survive.
A new report from market research firm Colmar Brunton warns that Australian retailers need to utilise online shopping to have continued success. Colmar Brunton’s research found that Australian consumers are frustrated with the limited online shopping options from national retailers, forcing more than half to choose to spend their money overseas with global competitors. These trends ring true in the mobile space too.
If Australian retailers want to give themselves an added advantage as the battle for wallets heats up, targeting the “always on” shopper through mobile marketing strategies and ensuring a positive mobile experience is vital.
Leading marketing research company comScore reports there was a 500% increase in mobile web traffic last year and Gartner, a leading IT research company, predicts mobile web usage will soon overtake browsing from a PC. According to Equation Research, more than 50% of consumers are unlikely to return to a site if they have a poor mobile experience, and 40% would go to a competitor’s site instead.
Reaching out to customers through their mobile handsets offers many benefits for retailers, including allowing for personalised marketing activity and providing the ability to create immediate incentives to drive customers to stores. Location tools can also be used as part of the communication and all activity can be tracked and measured to show a clear return on investment.
As Gartner states, by the end of 2011, over 75% of mobile devices shipped in mature markets will include a GPS, and others will use Wi-Fi and cell ID systems to identify location. There is the opportunity for retailers to turn to platform-specific Smartphone apps to deliver enhanced experiences and push marketing communications such as coupons and offers that are based on the customer’s
current location and personal preferences.
Beyond actually purchasing goods through mobile devices, studies show that the most popular in-store mobile activities include competitive price shopping, checking inventory, shopping list/basket management, and getting directions to local retailers.
Despite these findings and the fact that there are significantly more mobile services than people in Australia, there are a substantial number of Australian retailers who haven’t yet developed a strategy to target customers through their mobile devices.
For these businesses, here are three ideas to get started
Create a mobile opt-in database
Encouraging customers to register their mobile numbers is an important starting point. The easiest way to do this is to buy a keyword and shortcode through a mobile services provider. This creates an automated system where customers can text the keyword to the shortened mobile number (e.g. text CARD to 19954536) to register for a database.
To encourage registrations, it is important to show an immediate benefit (e.g. 10% discount in store today) and to display the keyword and shortcode prominently in store, online, and in existing marketing channels.
By creating an opt-in database, retailers can instantly begin targeting customers through SMS, a simple and cost effective way to begin mobile marketing. Research shows that 90% of SMS messages are opened within three minutes of being received, and 99% are opened overall.
These text messages can be used to deliver timely and relevant offers, encourage foot traffic and repeat customers. When used as part of a wider mobile strategy, they can also link through to dedicated mobile content such as store finder tools, exclusive offers, or mobile coupons.
Create a mobile website
Given the wide variety of mobile devices on the market, a mobile website can deliver a much broader reach than a device-specific app. A dedicated mobile website can also be used effectively as part of a wider mobile strategy, for example, as a landing page for an SMS campaign, allowing retailers to track click-through rates. Launching a mobile website offers a much higher return on investment than opening a new bricks-and-mortar store with overheads, staff costs and inventory.
When considering a mobile site, much thought should be given to the sort of content which will be offered as certain content is more appealing to someone browsing via a mobile device than on a PC. Helping people check store locations or opening hours, promoting that day’s best buys, or encouraging opt-ins to an SMS service can all be more effective on mobile than via existing web content.
Create or enhance loyalty programs
Mobile communication delivers a higher response rate than traditional print ads and therefore significantly increases ROI from loyalty programs. It also allows retailers to target specific customers, making it possible to create highly compelling, interactive and targeted offers. As a consumer, if I get a special offer for a complementary item to something I’ve already purchased, say insurance for a TV or boots to go with my jeans, I am going to be much more likely to convert on that purchase.
Using unique codes that can be scanned at the point of purchase and their use tracked and evaluated, mobile can be used to distribute coupons and loyalty cards. This can eliminate the need for consumers to carry all those plastic loyalty cards.
Also, by eliminating the need for printing and distribution which can often be very expensive, mobile loyalty campaigns can prove more cost effective and friendly to the environment.
Did you know?
- 27.6M mobile subscribers in Australia in 2010 (AMTA, 2010)
- More than 50% of all new mobile phones sold in Australia are Smartphones (ACMA, 2010)
- Growth in mobile wireless subscribers 13 times more than DSL (ABS, 2010)
- By 2013, more people to access internet by phone than PC (Gartner, 2010)
- In 2011 over 85% of new handsets will have access to mobile internet (Gartner, 2010)
- Smartphone sales up 96% on Q4 2009 (Gartner, 2010)
- 62% of shoppers with Smartphones have bought physical goods from their Smartphone devices in the last six months (Adobe survey, 2011)
- 43% of Smartphone users conduct price comparisons whilst in store, 31% review product information and 44% have downloaded coupons to redeem products (BuzzBack Market Research, 2010)
- =24% of a retailer’s revenue is lost due to customers not finding what they came to buy (WSJ, 2010)
Australian retailers need to go beyond online. The mobile device has become an acceptable and in many cases preferred, highly effective and rapidly growing consumer channel to market and Australian retailers need to embrace mobile to avoid being left behind, or worse.