Chances are these days, if one thinks of mobile phones and retailers, the first thing that comes to mind is showrooming. But not all retailers view customers bearing iPhones as threats.
Last holiday season, when most stores were on the showrooming warpath, six retailers at the Easton Town Center mall in Columbus, OH, turned smartphones to their advantage with a geo-fenced SMS promotion. Prior to Black Friday they sent a combined total of 20,500 emails to holders of their store credit cards carrying the subject line “Want to win a $5,000 shopping spree?” To enter, people had to text the word “Spree” to special number, open a confirmation message, and reply with a unique code number. When they got to the mall, they got pinged with a text that said, by way of example, “Jane, while at Easton Mall today, stop by XYZ Retailer. Use your XYZ Card to win the $5,000 shopping spree.”
Only one of the 520 cardholders who entered took home the $5,000, but the six retailers (who requested anonymity) received several Christmas presents. Purchases were made in participating stores at the mall by 37% of customers who opted into the program, and they spent 24% more than the average purchaser. A survey of 100 participants conducted after the program’s conclusion on New Year’s Eve found that more than a third were influenced by the text to visit a store and make a purchase. Two thirds said they’d sign up for future location-based promotions, and 84% said they were comfortable using their phones to communicate with retailers.
“A number of clients had approached us about mobile marketing, so we put this pilot together,” says Jim Walz, director of mobile strategy for Alliance Data, which markets and manages store credit card programs for specialty retailers. “They said that mobile was changing the way their customers were shopping, but that they weren’t seeing a lot of data on it.”
Alliance hooked up with Locaid, an aggregator of location data, to put together the SMS promotion. The company put it together fairly quickly, choosing the 150-store Easton Mall for its proximity to its headquarters office. “We are all about delivering marketing programs informed by consumer data, so we wanted to monitor this closely gather all the specifics we could,” Walz says.
Alliance huddled with the participating retailers to design a program that wouldn’t backfire by irritating shoppers during the busy holiday season. They decided that no opt-in participant should receive more than four emails during the five-week promotional period, and they set a minimum of five days between texts. Walz is convinced these respectful parameters led to the good reviews from shoppers.
“If we sent a text that said, ‘Hey Jim, we see you’re outside our store,’ that’s creepy,” Walz says. “But saying, ‘Hey, we see you’re at Easton,’ and reminding him of the promotion, that’s a softer message.”
Locaid Marketing Manager Louise Frosell notes that privacy only becomes an issue in geo-location campaigns if marketers are sloppy about them. “It’s our experience that if you deliver the right message at the right time in the right location, then it’s not an issue with people,” she says. Sixty percent of the customers surveyed post-program said they were not concerned with their privacy.
While she’s worked with location-based programs using apps, Frosell is a big supporter of SMS as the primary communication medium. Shoppers generally have their cell phones on and ready to receive texts, but there’s a good chance they won’t have a battery-draining app open. Using opt-ins from a retailer’s credit card or loyalty card program also ensures that it is reaching qualified customers with a promotion.
“If you reach out to people the right way with mobile,” says Walz, “you make them feel special and they want to engage with your brand.