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CMO, CIO partnership is key for mobile commerce success: IBM exec

February 7, 2013

A retailer’s chief marketing officer and chief information officer need to have a shared vision of how to drive mobile commerce in order to be successful, according to an IBM executive.

Mobile is a hot topic for many of the largest retailers around the world, but it presents both significant opportunities and challenges because of how quickly consumer use is growing. In some cases, CMOs want to push forward into mobile at a faster pace than CIOs are able to keep up with.

“The key will be the partnership between the CMO and the CIO to develop that roadmap of how we want to move the brand forward to the mobile world,” said Mike Riegel, vice president of mobile and WebSphere at IBM.

“For the CMO and CIO to have a shared vision of how that needs to come together, what the implications are of how you design mobile application in mobile first world, how you need to rethink your marketing processes around promotions, around customer loyalty,” he said.

“Those are all the things that the CMO and CIO need to have a shared vision around to be successful if they really want to capitalize on mobile commerce.”

Gap instant coupons
The collaboration between the CMO and CIO will be one of the important ways that the mobile commerce space changes in 2013 compared to 2012 as retailers begin to realize the need to focus more on customer experience.

The second big change will be linking mobile commerce to individual analytics to create a differentiated experience for each user.

“It is not about the phone and the apps – it is about the customer experience and converting that to commerce,” Mr. Riegel said. “I think that is new thinking for a lot of larger clients.

“There were some early adopters out there who were doing but by and large this year, the shared vision that is being established between CMOs and CIOs to put a real focus on commerce,” he said.

An example of how retailers are taking their mobile strategies to the next level is IBM’s work with Visa and The Gap to push instant coupons out to users in a mall leveraging Visa’s customer data and GPS location data.

How it works is that when someone in a mall where there is a Gap store makes a purchase using Visa, that user will receive an instant coupon from The Gap, which they can immediately use. The strategy has increased mobile-to-in-store sales by 110 percent.

The next stage of the program will be delving into if there are particular transactions that lead to higher conversions. For example, is a user paying with Visa at the mall’s food court more or less likely to redeem a coupon than one who is shopping in a sporting goods store?

Consistent experiences
Part of what is driving the increased focused on mobile at retailers are the strong results for mobile commerce during the 2012 holiday shopping season.

The challenge is that many of the larger retailers were out in the market early with mobile apps and mobile Web sites that simply ported the PC experience over to the mobile screen without taking advantage of the unique attributes that the mobile experience can offer.

Many of the early apps focused on pushing out information and coupons to users without leveraging what a brand knows about an individual customer.

For example, very few companies today enable users to start a transaction on a PC, log out and then pick back up right where they left off on a mobile phone later.

“Everybody is talking about how big mobile is how but what people are starting to realize is that mobile is now primary,” Mr. Riegel said. “In other words, it is the primary way that people are now interacting with brands.

“That is a huge opportunity but the challenge is how to capitalize on that,” he said. “The struggle is that a lot of people went out there and did early apps, threw things out there because they had to get out there quickly and didn’t really think through out how the app had to be a good experience of the brand that is consistent with your Web experience or your in-store retail experience.

“Increasingly, people are starting to realize that it is not about pushing and sharing information but that it is really about commerce.”

Driving transactions
With mobile commerce sales growing quickly and expected to account for 25 percent of overall sales in the next couple of years, retailers thinking more about how to embrace mobile commerce and how they can rebuild their customer experience in mobile environment in a way that will eventually lead to commerce and transactions.

This can include leveraging location-based data and social data, reviews and opinions and weaving them into the mobile experience.

Mobile is one of the top areas of focus for IBM as it works with retail clients. To help retailers drive innovation in the retail space, IBM recently announced that it will invest an additional $500 million in its labs in Toronto, Canada, focused on mobile commerce, with additional investments in mobile expected to be announced in the next few weeks.

“If you just take your Web site and you try to mobilize it as a mobile app and try to drive commerce through it, you are not going to be successful,” Mr. Riegel said.

“What you have to do is step back and redesign for mobile first and think about how do you change your customer thinking, the process of bringing a customer along the purchase funnel, to take advantage of mobile specific features,” he said.

Final Take
Chantal Tode is associate editor on Mobile Commerce Daily, New York

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