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March 2nd, 2012

During the last couple of years, mobile has been one of the hottest topics among marketers, and 2011 was definitely a pivotal year for this industry. It seems one cannot visit a marketing, advertising, media or business website without stumbling upon multiple articles speaking about some aspect of mobile. The increase in media consumption has been driven by the tremendous growth in adoption of smartphones, tablets and connected devices and the improved user experience. Merrill Lynch estimated that by 2013, mobile phones will overtake PCs as the most common device to access the Internet.

Mobile devices are embedded into our daily lives, and smartphones have quickly become our always-on companion, especially while making a purchase decision. In a recent survey by Google and Ipsos, 89% of respondents said they use their phone throughout the day for other than receiving calls, and 77% listed “in a store” as the place where they use their smartphones. The real benefit of having a smartphone in our hands at all times, other than being connected 24/7, is the possibility of engaging with our environment in new ways.

Mobile Commerce Taking Off
While mobile shopping may not be at the top of the list in terms of activities among smartphone users, frequent access to the Web from mobile phones is helping push mobile commerce into the mainstream. I recently read an article on Forbes about the matter, and it was explained very simply: when you order a camera on Amazon from your tablet or phone, it is mobile-enabled commerce, while the ability to use your phone at the actual point of sale and pay for coffee in Starbucks with your phone is mobile commerce.

Companies like Chipotle and Starbucks are using the technology to their advantage to keep their customers coming back, allowing them to order and pay directly from their phones. I have been using the Starbucks mobile app for quite some time now, and I have to admit, during the first three months after downloading, I made more trips to Starbucks than usual just to be able to test the new payment service. The app allows me to reload my rewards card, check my balance and, of course, pay at the store directly from my phone, which somehow I find fun every time.

(Watch the video here: http://www.starbucks.com/coffeehouse/mobile-apps)

Are We Shopping or Buying?
Currently, it is more about shopping than buying on mobile phones, but this is expected to change soon. Retailers are delivering a richer experience in-store to make deeper connections with consumers and ultimately convert shoppers into buyers. The same survey from Google and Ipsos referenced above mentioned that 74% of smartphone users made a purchase decision as a result of using their smartphone.

The main features shoppers are looking for are product information, ratings and reviews, coupons, and price comparisons. This raises the stakes for retailers, as they now have to compete for a purchase even within their store. For example, this past holiday, Amazon offered a 5% discount for consumers who scanned a barcode for an item at a store and then buy on Amazon within 24 hours.

Mobile Payments
What is next for mobile? Everything points at NFC, short for near-field communication. This is a short-range wireless technology that allows similar devices to establish communication by bringing them into close proximity; many credit cards already have this functionality. According to some new research, 44 million NFC-enabled devices will ship by the end of this year; however, to put things in perspective, over 630 million NFC devices are expected to ship in 2015 – this is four of every 10 phones. Services like Google Wallet, Square or Level Up are becoming more popular, and merchants such as 7-Eleven, CVS and Petco, which already have the technology, are now accepting this method of payment.

Although mobile payments seem to be “the last mile,” as some say, the value proposition of these services is still not clear. Is it really convenient to replace my wallet with my phone while I still need to carry my ID or passport? NFC is far from being a standard. Bluetooth 4 is now also part of the conversation, and the main difference between them is the longer transmission range.

Influencing the Final Decision
The rise of smartphones has made us more savvy consumers and has also created more opportunities for marketers. The ubiquity of the mobile device has allowed consumers to be better informed when making a purchase decision, and our smartphones have truly become the new shopping companion. These new mobile shopping habits enable marketers to influence a “ready-to-buy” consumer in new ways right before they buy. Anything from promotions, coupons and product reviews to ease of payment, the possibilities are limitless.

August 15th, 2011

Very few people would know that the Coca-Cola Company was the first corporation to offer a coupon for a free glass of Coca-Cola in 1888. The company had to provide free syrup to the soda fountains to cover the costs of free drinks. This was definitely an innovative tactic in its time, and by 1913 8.5 million Coca-Cola coupons had been redeemed.

But coupons have come a long way, and companies are looking for new and innovative ways to deliver deals to consumers. Large companies like Groupon or Living Social were born to do just that and have become so successful that others felt the need to get a piece of the pie; companies like Facebook and even Google came up with their own version of the daily deals.

A Like Has Its Benefits

In the past few months, American Express has released several loyalty programs that integrate powerful platforms such as Twitter, iTunes and LinkedIn, but most recently Foursquare and Facebook.

I have been an AmEx member since 2000 and I know that “membership has its privileges.” However, as frugal a consumer as I am, I reject all types of fees, especially bank fees. I never really saw any value in paying over $250 a year to access a rewards program of which I would never take full advantage, so I signed up for a fee-free card and I don’t leave my house without it. I am always looking for new ways to save money here and there, and that is why I got interested in two of their most recent loyalty programs.

AmEx launched their Foursquare program during SXSW in Austin earlier this year. Basically, it allows AmEx cardholders to access offers directly on their phones when checking in at a location. When the program rolled out nationally, I was ready to sign up. All I had to do was link my AmEx card online with Foursquare and I was ready to go; new deals showed up under the “Specials Nearby” option. It literally takes seconds to activate a deal and a statement credit will be applied to your account directly. See it in action here.

Another interesting program from AmEx was released earlier this month: “Link, Like, Love” on Facebook. It promises to deliver tailored, coupon-less deals based on your social graph. This is a good example of behavioral targeting with consent; you have to download the app and “allow” the content to be displayed.

With this application, you link your AmEx credit card to your Facebook account and access a selection of deals from participating merchants, such as Whole Foods and H&M. What I found most appealing is that the redemption process is as simple as it can be and takes away the coupon stigma; you won’t have to ask the waiter to scan a coupon while on a date. With the “Add to card” function, you only need to load your card with the deals you want, and once you qualify for the offer you will receive a statement credit reward within 2-3 business days…just like that!

Now let’s not forget that this is Facebook – everything on the application can be sent to your friends, liked and shared – and as your social graph evolves, the application will evolve to keep up with you to deliver new deals.

Here is a video of the “Link, Like, Love” announcement:

Check in to the Ballgame from MasterCard

This month MasterCard also released a rewards program with Facebook that integrates location-based services for their “Priceless New York” campaign. They were able to acquire some of the recently demolished Yankee Stadium seats and place them around New York City for people to find, like a scavenger hunt. Once you find the seat, you will need to scan a QR code to then be checked in on Facebook Places – this will make you eligible to win VIP tickets to a 2011 Yankee game.

This is a creative program that will only run for a month and it’s targeted to New Yorkers only – yes, they always get the fun stuff.

MasterCard’s Facebook Likes have been increasing daily as a result of the “Check in to the Ballpark” program – they are currently close to 55,000 – while AmEx Likes are over 2.1 million.

What Is the Real Value?

From my perspective, this kind of initiative brings value to all parties involved. The consumer will have easy access to more discounts and offers, which ultimately will drive trial, loyalty and frequency of purchase to participant retailers. Today, merchants are only responsible for the value of the discount, and fulfillment is transparent. As for AmEx, they will continue to enrich their customer database with more information while maintaining a good relationship with the merchants who fuel their business by providing them with tools that bring them new and repeat customers.

I also think that all this activity is probably one of the best ways of measuring and monetizing social media efforts.