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Upward Mobility:Developing an Effective MobileShopper Marketing Strategy
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  • INDUSTRY REPORT

    A supplement to Shopper Marketing magazine

    Upward Mobility: Developing an Eff ective Mobile Shopper Marketing Strategy

    The First Moment of Truth hasbecome a continuous information loop. The now-legendary phrase the rallying cry for in-store communication as an integral aspect of brand marketing is undergoing a dramatic transformation now that consumers are standing at the shelf with smartphones in hand. For one, theres now a good chance that the fi nal purchase decision of which Lafl ey spoke was already made at the store entrance, in the parking lot, or in the car on the drive to the store infl uenced by marketing touchpoints that didnt even exist in 2002. Perhaps more signifi cantly, the purchase decision wont necessarily conclude at the shelf or at least that particular shelf: after scanning the packagings UPC, the shopper may discover that a retailer down the street off ers the same product at a cheaper price; once she gets there, she might download a coupon for a competing product by scanning a shelf-sign QR code. Thanks to increasingly sophisticated mobile devices, the consumer has become an ever-moving target that is never more than one click, ring, text or tweet away from entering shopper mode. But, for better or worse, the shopper that she becomes is savvier and much better informed than her predecessors, due to the growing number of on-the-go tools at her disposal.

    PRESENTS:

    Thirty million times a day P&G brands face their First Moment of Truth, when consumers stand in front of a store shelf and decide whether to buy a P&G brand, or a competing product.

    A.G. Lafl ey, Procter & Gamble,

    then-CEO, 2002

  • 2INDUSTRY REPORT

    Welcome to the Mobile WorldProcter & Gamble already understands these changes, which is why the packaged goods company (and industry bellwether) devoted a great deal of resources in 2010 to launching smartphone apps for Tide, Always and other brands, providing downloadable coupons for top retailers such as Kroger and Safeway, bolstering its charity initiatives through third-party apps like CauseWorld, and even selling Pampers through Facebook. Other packaged goods manufacturers such as Kraft Foods, Kellogg Co., Kimberly-Clark and Unilever also have been mining the mobile space for several years although all of the above would likely admit that they havent yet fully cracked the code on best practices. Numerous other product marketers are following suit because of the tremendous potential that the mobile channel presents. Mobile is the fi rst marketing technology that can be used through the entire purchase cycle, says Anthony Iacovone, founder and chief innovation offi cer of Augme Technologies, a New York-based company specializing in mobile marketing technologies and services. You start with a mobile call to action in a TV ad, and you fi nish with a text-message reminder about the incentive in the store. A mobile phone is always with you, and its almost

    always on, says Molly Garris, manager of digital strategy at Arc Worldwide, the Chicago-based marketing services arm of Leo Burnett. It lets marketers truly engage consumers by making the message far more relevant and personal. Mobile marketing has, of course, been around for years, and has been prevalent in other parts of the world such as Japan and Israel for more than a decade. Initial forays in the U.S. were hampered somewhat by strong consumer backlash to unsolicited phone calls, but the emergence of text messaging in 2001 made marketing communication far more palatable. In the last few years, texting has become a standard promotional tool for many marketers, particularly when targeting younger consumers. It was the emergence over the last seven-odd years of the smartphone and its computer-like functionality

    Internet access, email, fi le downloading that sparked marketers to really begin examining the possibilities, however. There are things you can do with feature phones such as text messaging, but with smartphones, we can really take it to the next level, says James Schuh, global digital marketing manager for Kimberly-Clark. And it was Apple Inc.s launch of the iPhone in 2007 that began turning the smartphone into a must-have

    technology and a cultural phenomenon. The only questions remaining for marketers are, when will smartphone penetration reach critical mass, and how many U.S. consumers will use their devices as an essential shopping tool? By all accounts, the answers to those questions are very soon and a lot. Roughly one out of four mobile subscribers already owned a smartphone by October 2010, according to comScore Inc. More signifi cantly, that means nearly 20% of the U.S. population had one. And The Nielsen Co. predicts that 51% of the population will be carrying one around by the end of 2011. The ability to browse the web on mobile devices something that 36% of the 234 million U.S.

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  • 3mobile subscribers already do, according to comScore initiated their use as a shopping tool. The ongoing launch and adoption of smartphone applications that specifi cally or indirectly facilitate shopping by locating stores,

    delivering coupons, organizing lists and off ering trip incentives, to name a few has taken the concept to new heights. And with AT&T, T-Mobile USA and Verizon Wireless jointly building a network aimed at turning smartphones into mobile wallets within 18 months, the future of mobile as a critical shopper marketing tool seems

    uncontestable. I cant fi nd one campaign where having a mobile component doesnt make sense, says Iacovone.

    Anytime you are making a call to action, it needs to be mobilized.

    The Speed of ChangeDespite this rapid evolution, mobile shopping and, therefore, mobile shopper marketing is still a relatively new concept. When it comes to employing their mobile devices as a shopping tool, 10% of users are generating 80% of the volume right now, says Carrie Newman, research manager at Arc, which conducted extensive consumer research on the subject in September 2010 (see page 8). Most people are dabbling, still learning whats available and how to use it. (For a comprehensive list of mobile shopping activities, see the chart below.) The same holds true on the marketing side of things, where many companies are experimenting with

    various tools and technologies but few have developed a comprehensive strategic plan. A spring 2010 survey conducted by Forrester Research/Shop.org, for example, found that only 20% of retailers had implemented a mobile marketing strategy. Product marketers may be a little further along. A November survey conducted by the In-Store Marketing Institute found that 35% of consumer product marketers are already working with smartphone apps, 30% with mobile coupons, 21% with QR codes and 13% with location-based services. And better than 40% of the non-users plan to implement those tactics in the near future. Whats more, in a spring survey from MediaPosts Center for Media Research and InsightExpress, 40% of companies said they would boost mobile ad budgets by 30% or more in 2010. Mobile is a chew toy and were all teething, says David Apple, chief marketing offi cer for Augme. The tendency is to do something because its buzzy. But Id say that 50% of program executions right now are poor. The singular fact that consumers are migrating to a mobile lifestyle more than 30% of mobile subscribers use their phones as the sole computer for their household, according to Morgan Stanley makes embracing the channel an imperative for marketers. But mobile marketing is an ideal vehicle for several other reasons as well. For one, it facilitates the targeted, relevant communication that is the essence of shopper marketing. As a corollary to that, it also eliminates waste: rather than distributing 40 million FSIs to anyone who buys a Sunday newspaper, a brand can deliver one million to the smartphones of consumers whove asked to receive

    PORTABILITYUse a search engine to get information during shopping process Look up store address, store hours or store locationRefer back to retailer emails you have saved in your inboxReceive notifications about in-store promotions, events or offers

    VIRTUAL SOCIAL SHOPPINGGather/Share opinions about a product or store from friends/family Receive/Share

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