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Are mobile incentives the only way to drive consumers in-store?

July 20, 2011

While offering a mobile incentive helps drive traffic in-store and build relationships between companies and consumers, are retailers targeting customers in the right way to increase their revenue?

From mobile coupons, redemptions and customized deals, companies are doing everything they can to get customers in-store.  Industry experts agree that incentives are important, but should not be the only aspect of reaching out to a company’s audience.

“Incentives are an element of location-based services, but they are not the sole reason behind why people should use their mobile device to go somewhere,” said Dan Gilmartin, vp of marketing at Where, Boston.

More than incentives
Incentives are a great way to gauge consumer interest in a brand, but some experts say there is more than just using deals to really connect with consumers.

In order to fully understand if incentives are effective or not, you need to look at what consumers are in the market for while they are searching on their mobile devices.

More specifically, companies need to use a retention strategy to understand the best way to draw-in specific consumers.

“If you would never visit a store anyway, you’re not going to go there just because you have a deal or incentive,” Mr. Gilmartin said.

“Likewise, consumers use location-based services when they’re in need of something, so they can’t rely exclusively on deals either,” he said.

According to Mr. Gilmartin, consumers who search on their mobile devices are only looking for local results since their smartphone functions as an on-the-go resource.

“Incentives are a key part of a marketing mix, but they are not the only way to get a consumer in store,” Mr. Gilmartin said.

“Merchants should look for ways to reach their audience by leveraging several types of content, and they have the ability to drive people into stores using location-based services,” he said.

Link to sales
In order to run an effective location-based campaign, companies must include both local retailers and mobile elements such as mcommerce so that they work with each other.

“Although there is a wide selection of mobile ad networks that can deliver on proximity marketing, very few have figured out how to link this up with actionable loyalty reward programs since these incentive programs are all different,” said Wilson Kerr, Brookline, MA-based location-based services consultant.

“While customized iterations allow small businesses to enter in one-off specials, the real opportunity lies in integration with existing, national loyalty programs that can be tied to actual purchases,” he said.

“Brands should dedicate resources towards understanding how a broader mobile campaign can drive traffic to a retail location and then link the campaign to actual converted sales.” 

In-store experience
Mobile is a simple and convenient way to draw consumers in, but companies should not overthink the in-store experience.

“Consumers have a wide range of shopping choices on mobile, but nothing replaces touching physical goods while in-store,” said Alistair Goodman, CEO of Placecast, San Francisco.

“Mobile should be seen as a way to connect the digital and physical shopping worlds,” he said.

In-store experiences are a key part of shopping, and while mobile might make shopping easier, incentives need to be used in conjunction with other mobile marketing efforts to grab the attention of users.

“Looking long-term, companies need to establish a mix of compelling features to create a long-term customer value,” Mr. Goodman said.

Stores need to think about how deals can lead to further brand engagement.

According to Mr. Goodman, if a consumer comes into a store with a mobile deal, they are more likely to purchase other items from the store as well.

“In the future, we will see the ability for consumers to choose preferences and receive alerts from brands they want on their mobile devices,” Mr. Goodman said.

“The mobile phone is such a personal item that consumers want to have the ability to customize their searches and results with brands they are already connected to,” he said.

Final Take
Lauren Johnson is editorial assistant on Mobile Commerce Daily, New York

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