The mobile gauntlet is down, and the battlefield for customers is now everywhere, anywhere, at any time of day or night. The simple cell phone, the popular smartphone, and sparkly new tablet computers have successfully untethered customers forever. Morgan Stanley projects mobile will be ten times bigger than the Internet by 2020 due to converging trends and game-changing platforms. This suggests that success in mobile will drive success of all businesses. This month's eCRM Advisor takes you for a deep dive into this key channel for your relationship marketing program.

Engaging with Customers Through Mobile
By Christiane Grando, Strategy Director

Remember when a phone was just a phone? A simple cord, a handset and the only thing you used it for was phone calls – oh, how things have changed. No one has just a "phone" anymore; people own mobile devices or smartphones. With the advent of mobile technology the rules of engagement have changed significantly.

Mobile commerce revenues are predicted to double in the US this year, to $2.4 billion.* New technology has given marketers the ability to connect with consumers without the barriers of time and place. As part of an integrated marketing strategy, mobile communications can contribute significantly to the bottom line. The unique ability to interact with customers via a device that is always on and constantly carried allows for a distinctive relationship-building environment.

The 'multichannel' channel

Mobile has become the only channel that is truly multichannel. It is the channel that is always with the consumer – at home, in the store, in the dressing room. Mobile Internet is ramping faster than desktop Internet did, and it has the potential to augment the consumer experience at each point of the purchase cycle.**

Currently, short message service (SMS, or text messaging) dominates mobile marketing efforts. However, other tactics such as multimedia messaging (MMS), applications, and mobile advertising have emerged as options to simple text messaging. With each new way to interact, the mobile marketing space becomes even more attractive to marketers wishing to extend their reach.

Smartphones have changed the playing field when it comes to more traditional online marketing methods. Internet and email have emerged as two conduits that perform successfully on smartphones and in the mobile space in general. According to e-Dialog, nearly six in ten Internet users around the globe said they were more apt to buy a product in a store after getting a marketing email. The mobile platform allows those marketing emails to be in front of the consumer regardless of time or place.

Key advantages of mobile

Mobile marketing offers a number of benefits unmatched in other channels including:

• Improved targeting: Targeting can be based on a variety of variables that only a mobile device can provide (location, device, application data, etc). Additionally, phones are used by only one person, making one-to-one messaging viable.
• Reduced cost: Mobile campaigns don't require mailing platforms or involve printing costs and fees for sending are nominal.
• Compressed production time: Messages can be created and sent in a fraction of the time needed for any other channel.
• Deliverability: Delivery numbers are often high, as mobile phone numbers change much less frequently than email addresses.
• Accessibility: Messages are received and carried wherever recipients go regardless of time and place.
• Interactivity: Mobile phones are inherently highly interactive (text, email, video).

• Discounts or coupons: These can be delivered almost immediately and simply kept on the phone for future use.
• Mobile phone content: Ringtones and applications are bought on the fly and enhance the overall mobile experience.
• Loyalty programs: Using phones to collect or redeem reward points makes participating in loyalty programs easy and immediate. Voting via text and sweepstakes is also very popular.
• Ticket purchase: Tickets to events and concerts or travel can be purchased as the need or desire arises. It becomes much easier to be the first to get a ticket as they become available if it can be done anywhere.
• Purchase of physical goods: The need to wait until a computer can be accessed is reduced. Items not available in stores can be purchased online without waiting.

TECHNICAL CORNER
Mobile Coupons: Know Your Consumer, Be Yourself ... Then K.I.S.S.
By Paul Gelb, Mobile Practice Lead

In 2008, after years of searching for a viable mobile coupon solution, the Razorfish Mobile Practice had rendered a coupon barcode to a mobile phone that could be read by a point-of-sale scanner. In our lab, there was no perceivable difference between the scanning of a paper coupon and the screen of the mobile device. An hour later, I determined that I would never recommend this technology to a client. After the joy of seeing a new technology work, I realized I had broken the cardinal rule of any widely applicable solution: "Keep It Simple Stupid" (K.I.S.S.).

Simplicity can mean many things. I have always thought Dr. Koichi Kawana, the famous botanical gardens designer, provided the best definition: "Simplicity means the achievement of maximum effect with minimum means." This solution, in the real world, made coupon redemption exponentially more complicated for brands and consumers and failed to deliver the full value that the mobile channel can provide. The barcode scanning seemed simple enough in the lab, but Razorfish clients do not operate their businesses in a lab and their customers do not redeem coupons in a lab.

The mobile barcode scanning solution had five major operational problems.

Training: This solution required both retail employees and consumers to learn a new behavior. Thousands of cashiers, many of whom earn the minimum wage, and millions of consumers would have to learn about the new coupon redemption offering and swiping process.

Checkout Time: The scanning process could take longer than scanning paper coupons. Until employees are familiar with scanning a coupon on a phone, the checkout time per customer would likely increase. Multiple coupons for multiple product specific promotions would further complicate the process for cashiers, as they would have to navigate from barcode to barcode on the phone. As well, there were numerous types of scanners and there was a good probability that some scanners would have a higher fail rate for mobile screen coupon scanning than for paper scanning. This would also increase the checkout time per consumer. Longer checkout times and/or longer checkout lines would diminish the consumer's shopping experience, which hurts sales.

Device Damage: The consumer would have to hand over their mobile device, which may have cost hundreds of dollars, to a minimum wage employee. If the employee dropped or broke the phone, the relationship between consumers and the brand would be tarnished and the cost of replacing devices could decrease the ROI of the program.

Scale: The barcode could only be rendered as an image with a high enough resolution for scanning to a limited number of phones. In 2008, less than 80% of mobile subscribers had devices that could render an image with the minimum level of resolution required for scanning. The impact would be significantly hindered by a lack of scalability.

Auditing & Settlement: Our prototype only addressed distribution and redemption of an offer. The solution did not take into account that grocery stores and pharmacies require paper coupons for auditing (to prevent fraud) and settlement of the coupon with the CPG brand or pharmaceutical company that is paying for the promotion.

Discovering a mobile couponing solution that works

Since that fateful day in the lab, the Razorfish Mobile Practice has found a solution that, through its simplicity, addresses all five problems of mobile barcode redemption and generates more value to retailers, grocers, pharmacies and CPG brands than the current paper coupon system. Instead of delivering coupons as a barcode, the promotion format for redemption can be a 5-, 8- or 10-digit code. Consumers can punch the code into self-serve credit card swipe hardware, which has become almost ubiquitous at retail stores, groceries and pharmacies. The technology leverages a software solution that can be installed easily at brick and mortar locations. By the end of July it will be pre-installed on 75% of grocery stores point-of-sale software and will only require the grocers to turn it on. Installation of the software onto a retailer's point-of-sale operating system can be done in less than two weeks.

Training: Neither cashiers nor consumers will have to learn a behavior or operational process. Consumers are used to punching their five-digit zip code into the point of sale devices. Since consumers are leveraging a self-serve device, cashiers are taken completely out of the process.

Checkout Time: Additional time required for scanning multiple coupon codes, handing over a mobile device to the cashier and scanning failures would be removed. A ten-digit code could be the consumer's phone number and it could trigger coupon offerings for multiple products.

Device Damage: The self-service execution and the numeric code coupon format remove any need for the consumer to hand over their phone to an employee. In fact, the consumer does not even need to have their phone with them at the store.

Scale: One of the most impactful differences is the potential scale of this solution. Codes could be delivered to users via banner ads, emails, text messages, Facebook messages, tweets and other consumer touch points. One of the most promising opportunities is to provide consumers with a five-digit coupon code that they can share with their social graph. Consumers could email, text or post on a social network the offer and five-digit code. This would be extremely valuable as it would provide the opportunity to track back all redemptions that used the five-digit code to one consumer so that the influence and value of the users could be calculated.

Auditing & Settlement: The software for the point of sale is not only easily integrated into the operating system, it is tied into several coupon clearing houses. The connection with the clearing houses allows auditing and settlement to occur in real time as the coupons are redeemed.

To achieve the necessary simplicity required for a successful mobile couponing program, retailers, grocers, pharmacies and CPG brands should use the same approach that is often recommended for a first date. First get to know consumers and the experiences that they like (a fast, intuitive check process), be yourself (understand your employee, technology and industry ecosystem infrastructure) and then you will be set up for initiating a kiss (a solution that requires little effort, but has a large impact).

ABOUT US

Razorfish eCRM Solutions is a dedicated solutions group in the Razorfish Network, built to support the evolving needs of our clients in building best-in-class marketing programs. The team is a comprehensive set of experts in email marketing and relationship marketing that supports all forms of strategic services, including strategic planning, communication roadmaps, email delivery and technology, campaign management and optimization with an emphasis on experience and analytical optimization.