Mobile-based rewards programs are incredibly popular right now. While people always love a bargain, the new economic reality is that consumers are now utilizing cost savings techniques like loyalty programs with greater and greater frequency.
According to Colloquy, U.S. consumers alone have over 3.3 billion memberships in customer loyalty programs, which is a sizable 26% increase over their last survey in 2013. In fact, according to their research the average American family has memberships in 29 loyalty programs.
Customers have come to expect loyalty offers from brands and may leave one to go to another that offers one.
Along with the overall growth of loyalty programs, mobile rewards programs have exploded in popularity and are expected to continue to do so. According to Forrester Research, consumers rank rewards high as a important element of mobile shopping. In fact, Forrester’s data showed 76% of consumers were interested in utilizing loyalty program points and rewards in a mobile digital wallet.
Choosing a mobile application developer that understand key touch-points with mobile loyalty programs can be helpful. As part of your mobile rewards strategy that you develop and implement with your iPhone application developer and Android application developer, make sure that you pay attention to how customers respond and optimize your program to meet your customer’s needs. With rewards programs its best not to take a ‘one-size-fits-all’ approach but to tailor your program to your customer’s behavior and preferences.
What can a mobile loyalty program do for your business?
According to Harvard Business Review, loyalty programs can do 5 things for brands:
1. Keep customers from defecting
2. Win greater share of wallet
3. Prompt customers to make additional purchases
4. Yield insight into customer behavior and preferences
5. Turn a profit
How effective can rewards programs be?
When Kohl’s recently reviewed the effectiveness of their loyalty program they determined loyalty customers, made two extra trips to the store and spent $80 more per year. Keep in mind, as with everything in business, loyalty programs are not always successful. Building the right program and rewarding the right behaviors are critical for success.
The Small Business Administration blog gives this advice when it comes to loyalty programs, “Reward loyalty with some class. Freebies don’t always appeal to all and they can even de-value your services.” Furthermore suggesting, “Experiential rewards are always popular. For example, a hair salon could offer a monthly workshop that offers free makeover tips to loyal customers. These experiences add value to your customers’ lives, build community, help your business stand out and give customers reason to keep coming back.”
What are the key elements of a successful mobile rewards program?
Analytics & Data
To create a successful mobile loyalty program you will need to understand your customers. Make sure you plan ahead to make data available so you can review if your loyalty program is properly engaging your target audience. Data and analytics will also help you be able to personalize the experience for each customer over time.
Personalize the Experience
The more data you capture, the better you can target and customize the experience for each of your users. Personalization is important in building effective mobile user experiences and it is not different with mobile rewards programs. Personalization helps build loyalty and engagement. Data will help you optimize each user’s experience to their preferences.
Rewards & Exclusive Offers
Make sure you reward customers for the appropriate behaviors. Leverage their mobile device to track their shopping behavior, such as purchases, and offer rewards based on that behavior. Exclusive offers are also a powerful part of several strong loyalty programs as several retailers offer loyal customers priority access to exclusive products, offers and sales.
Customer Engagement
Utilizing tools such as push notifications have shown to increase response rates by up to 300%. Other contact methods such as e-mail and SMS can also play an important role in your customer engagement strategy. A key part of loyalty programs is re-engaging customers, doing so with a sense of urgency can be powerful so don’t be afraid to try time sensitive offers.
Leverage in-store experiences
Many successful mobile rewards programs link loyalty to in-store experiences by offering product information and more. The future of retails involves improving in-store experience with powerful mobile applications that can improve the shopping experiences for you customers.
Photo: Omar Jordan Fawahl (Flikr) http://bit.ly/1ynqiAr
Mobile has revolutionized not only the way we interact and communicate but how we do business and as such, mobile has become a vital aspect of “how we do business” to businesses of all sizes around the globe.
Whether you are just looking to dip your toes in or to have a responsive web site built or to contact an iPhone application developer or Android application developer, it is important that your business understands the importance of mobile and the implications of it when it comes to doing business in the future.
First of all, consider that mobile is a lively, active medium that is regularly on your customers minds. According to Mobile Marketing Watch, 46% of smartphone users say they utilize their mobile devices as their primary search tool. Their research went on to reinforce the importance of smart phones showing that 91% of smart phone users check their email at least once per day from their phones. Additionally, 76% use their smart phone for social media at least once a day. Beyond that mobile devices are shown to be critical to retails as 35 % of in-store shoppers actively comparison check prices on their smart phones while shopping and 31% look up product information while shopping.
But beyond that, mobile marketing is a highly effective advertising medium. According to a recent Smart Mobile Cross Marketing Effectiveness study, “mobile is a strong driver of campaign performance across the entire purchase funnel. From upper funnel metrics like awareness and image, to purchase intent and actual behavior (foot traffic or sales), the empirical evidence proves that mobile has a fervent contribution to campaign results, justifying a double-digit allocation of the entire media budget (not just digital) to mobile.”
Mobile allows you to engage directly with customers in ways business never could before. From giving exclusive offers to your mobile app users when they are in a location to take advantage of the offer to building in functionality to allowing your customers to customize their shopping experience, mobile takes engagement to a whole new level. If you make the experience personal your users, they will be more engaged and more likely to return.
Beyond the now, forward thinking businesses are looking at The Internet of Things and the opportunities that it offers to businesses. The Internet of Things is growing exponentially and creates incredible opportunities for businesses to serve customers with new levels of service and convenience that they never imagined before.
Image: Kent Chen (Flickr) http://bit.ly/1N5f2PY
In a recent study from the Mobile Marketing Association (MMA), they looked at the complete marketing budget for four businesses: Coca-Cola, Walmart, MasterCard and AT&T. MMA’s goal was to determine the value of mobile ad spending. After reviewing budgets and campaigns from these four companies they determined that bigger mobile budgets lead to higher advertising ROIs.
Companies are not just shifting their budgets to iPhone application development, Android application development, mobile web sites and mobile advertising because it is trendy, they are making the shift because it works.
A perfect example of this is when Coca-Cola launched its campaign for its Gold Peak Tea, they found that mobile accounted for 6% of the sales despite only requiring 5% of the budget. MMA goes on to show that if Coke had spent 10% of their budget on mobile instead of 5% that they would have seen an extra 4% in sales on this single campaign.
When it comes to Mastercard, MMA states that by allocating just 8% of their budget to mobile, they could reinforce their image as ‘a good card to carry while traveling’ by 7X. When looking at campaigns, Mastercard found mobile marketing produced 2X the results compared to campaign average. “I was surprised at how effective [mobile ads] were in relation to other media,” said Adam Broitman, vice president of global digital marketing for MasterCard.
According to Greg Stuart, CEO, MMA, “With very limited effort, brands can increase the performance of a campaign by 30 percent on average (and potentially much more) by simply reallocating funds.[to mobile]”
A key feature to mobile marketing programs, according to the report, was location targeting. Walmart program utilizing proximity targeting to reach people within range of a store proved 1.5X more effective than simply sending ads to people who had visited the store before.
Additionally, the MMA study also points out that ads that contain audio or video components produce a higher return on investment than standard display ads.