May 13, 2014

Retailers Double Down on Mobile At this time of the year, retailers make technical and functionality investment decisions focused on Holiday 2014. The biggest issue is what to invest in mobile marketing. Fortunately retailers can rely on the 13th Annual Merchant Survey produced by my friend and colleague, Lauren Freedman at the e-tailing group, for insight and direction. Mobile users browse stores, open promotional emails, compare features, functions and prices, showroom, photograph goods and share products with friends. Mobile accounts for 20 percent of traffic for the majority of retailers surveyed. For one in five retailers, mobile traffic is 30 percent. (In contrast, the majority of responders peg social traffic at less than 2 percent.) According to the survey, 50% of those surveyed report that mobile consumers contribute at least 5 percent to their revenues and another 32 percent say mobile contributes at least 10 percent. Seventy-five percent of survey responders say mobile is “critical to the growth of our business.” But 39 percent admit “its hard to know where to invest relative to mobile initiatives.” And while its critical that retail sites need to render properly on smartphones and tablets, nobody really knows which added functionality would drive more profitable conversions and repeat purchases? Retail competition is fierce and conversion rates have remained stagnant at 2-3% over the last few years. Almost half of retailers are focused on improving their pages and brand experiences. Another third are amping up onsite merchandising, upgrading sites and instituting responsive design. One in three are spending more than $100,000 on mobile enhancements. My hunch is that the best investment is in messaging not necessarily functionality. For the foreseeable future mobile will primarily be a research tool not a buying mechanism. Most email is now read on mobile devices. Video is moving in the same direction. Mobile search is an increasingly important factor. This leads me to four new mobile retail messaging tactics. Frequency. Crafting a single impactful message and communicating it often yields greater awareness sooner. The same message, more times on more devices equals higher reach and more persuasion. Synchronize a persuasive offer and communicate it within a defined time window (think SuperBowl) to penetrate and persuade a target group faster than ever before. Sequencing. Parse a retail pitch. This applies the classic 1940s Burma Shave OOH approach to mobile. The additive value of sequential messages over a limited time period can hammer home a promotion or sale. Fractal Messaging. A variation on sequencing would be to acknowledge different facets of a brand’s appeal and expose different facets or offers at different times to different people using different devices. Product details and rich images go on tablets while sale pricing, sale dates and bonus offers go on smartphones, in SMS messages or are placed in online media, This assumes that consumer moods, mindsets and tasks are different by device. So while prospects may resent ads on their smartphone, they might be willing to watch pre-rolls or other video formats on a tablet or phablet. By understanding how consumers use devices both in terms of the mechanics (who, what and where) and their sensibilities (openness to being interrupted or interacted with) brands can optimize sales by aligning with consumers’ workflow and life style patterns. Orchestration. Assign specific marketing tasks to specific devices in the same way that Bach, Beethoven and Brahms assigned specific roles to specific instruments. One plays the base theme. Another adds the variations. TV, print or catalogs lay down the basic message, while tablet content amplifies or expands the message and smartphones become the channel for consumer reaction, interaction and response. mCommerce is still in its infancy. Beyond technical investments, it’s time to start creatively experimenting with mobile messaging.
Facebook Courts Direct Marketers Facebook Exchange, FBX the ads in the News Feed -- the primo real estate on Facebook -- is a year old and vying to become an indispensible partner to direct and CRM marketers. The pitch directly addresses the needs and anxieties of brands that want consumers to take action on social networks. Facebook, in a new deck circulating to advertisers, argues that they can find, mirror and more accurately target audiences, simultaneously access desktop and mobile users on a broad range of devices, leverage search and display ads across the Internet and do better ROI metrics. There is nothing subtle in Facebook’s move to curate, qualify and market audience segments. Absent is the long-standing claim that Facebook is strictly about relationships, sharing, engagement and saving the world. Most of the magic is a three-stage data mining process. By taking data from brands and combining it with demographic, psychographic and behavioral data from third party sources like Epsilon, Acxiom and Datalogic, marketers can get a tighter bead on likely buyers. Then by matching combined brand and outside data with Facebook profiles, the platform can deliver a specific message to large numbers of individuals meeting very narrow criteria eliminating waste and optimizing the likelihood that consumers will opt-in, share, sign-up, download or buy something. Like traditional publishers or broadcasters, Facebook claims to offer seamless and measurable targeting, reach and delivery. Facebook claims a 50% accuracy advantage over the average online campaign. This is the Holy Grail for direct marketers; maximum response with minimal waste across channels at efficient costs. For brands without a direct marketing or CRM infrastructure, Facebook potentially is a plug-and-play solution since brands can potentially find and reach their best customers, find more prospects that look like best customers or create new target segments virtually on the fly. But while Facebook will deliver a branded message to targeted users and tell you what percent of your database are on Facebook, they won’t share the details or trade data with brands. With massive reach and strong frequency, based on the fact that people check their newsfeed as much as fourteen times each day, Facebook is looking to take serious market share away from display advertising, search and email marketing. The social network’s leading mobile posture is a second strong direct response argument. With zillions accessing Facebook everyday on smartphones and tablets, a brand can reach their customers and prospects and finesse all the costly, complicated and confusing device, rendering and carrier issues with one partner. Tight targeting and mobile access when combined with links to branded websites, pixel tracking for retargeting and internal databases, gives a brand continuous exposure to people who have shown any sign of interest. This is, depending on your perspective, is either super-targeting or super-stalking. Either way, research shows that it delivers more, faster response. It also explains how that pair of shoes you looked at on Zappos follow you around the Internet and appear on your Facebook page. Newsfeed or Timeline units, a 154x154 pixel image and several lines of copy, were created precisely to enable precision targeting and pixel tracking to enable retargeting on Facebook and across the web. Consumers can like, share and comment on FBX ads, so virility is baked in. My clients using these units are reporting strong cost effective results. And even though many have been extorted into buying ads since Facebook choked off access to the fans they accumulated by manipulating the Edgerank algorithm, the guys paying the bills now can find out how many fans, followers or likers are actually buying products. Facebook is aggressively addressing direct marketing fundamentals and focusing on critical ROI concerns. Many of their social network peers are following suit. It will be fascinating to see how and how quickly traditional direct response partners respond. Stay tuned. It’s about to get very interesting.

Danny Flamberg

I am a veteran marketing consultant working with leading and emerging brands

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