August 30, 2011

Written by Gary Schwartz

Mobile commerce is not only about payment but the ability to optimize the path to this payment.  Farhan Ahmad, Director of Emerging Payments at Discover Financial Services, the issuer of the Discover Card, the third largest credit card brand in the United States, explains, “Mobile payment is a small subset of mobile commerce.  Mobile commerce is primarily about shopper engagement and marketing.”

What are the mobile marketing mechanisms to engage with the retail shopper?  Twitter’s micro blogging, Facebook’s community building, FourSquare’s crowd sourcing and Google Deals all are valuable tools but any brand or retailer with a committed digital strategy across all their customers’ screens needs to establish a direct relationship with the shopper.

The only two-way targeted channel to move the shopper across the retail touch points is via the shopper’s phone number.  Once a permission-based relationship is established between the shopper and the retailer, FaceBook, Foursquare, Google, or Apple should not disintermediate this relationship.  Messaging can be targeted and personalized – improving brand recall and conversion rates.

Like other D2C channels, mobile messaging should deliver concrete results.  A good service provider will be able to show the brand a projected return-on-investment calculation.  Key to building a strategy is to be able to articulate how you intend to effectively opt-in the consumer and what your key performance indicators are, including what retail touch points you would like the channel to connect to drive your sales.

Methods for growing your opt-in include website to text opt-in, 2D barcode scanning, NFC tag tapping and direct to txt opt-in. Here are some ways to start the process now:

Large-Screen Web
This is probably the most logical place to start for most brands as it extends their existing CRM opt-in and offers the consumer a choice of channel.  Give your consumer a channel choice. Allow for opt-in on the web form to bridge the conversation from large screen to small screen messaging.  Messaging that is closer to point of purchase and point of decision.  The key is to immediately engage on the mobile channel after the submit button.

Scan
2D codes are dotted everywhere on paper media. It is cheap and easy. Scan and move the consumer to web.  The challenge is moving the consumer to a 2-way opt-in relationship.  What many miss in the 2D code discussion is the ability for the scan to open directly into a messaging or short code opt-in. Speak to your technology vender.  If you want to move directly to mobile web, make sure you allow for messaging opt-in on this landing page.  Without this engagement, this is an anonymous click-through with little onward going ROI.

TXT
However old-school, TXT is still the only two-way channel that the consumer uses on their phone – that is native to the phone – and that the retailer can develop a place in this circle of trust.  Develop a rich content relationship with a brand loyalty and drive sales. SMS delivers 3x the conversion on POS deals in measured, close-loop conversion over traditional channels such as email.  Avoid simple and underwhelming TXT2WIN and focus on promotions and engagement that tie to purchase or to the needs of the brand loyalist.

Look at TXT as being a staple channel: contactless and other technologies will simply allow for more seamless engagement into the messaging channel.  Look to BBM and iMessaging to allow for marketing campaigns and communities to coexist in the near future.

Tap
Keep an eye on Near Field Communication (NFC) – it seems to be all about payment but it is more about proximity marketing.   Tag a product or poster and allow for TAP2opt-in, TAP2WEB, TAP2Coupon, TAP2Shop.  Think of this as a more frictionless SCAN.  Native to the phone’s OS, TAP contactless marketing does not require an APP and will be native to the handset – always on and always a TAP away from activation.  The challenge will be building critical mass in market.  Look to late 2012 and into 2013 for some reach and frequency in your shopper base.  However, start experimenting now!

 Gary Schwartz, CEO Impact Mobile and Chair of MEF North America

Over the past nine years, Gary has played a leadership role in the mobile industry, founded Impact Mobile in 2002 running the first cross-carrier short code campaign in North America.

In 2006, Gary founded the mobile committee for the Interactive Advertising Bureau (IAB) (www.iab.net) (for which he received an IAB award for industry excellence in 2009).

In 2010, Gary was elected as the Chair of MEF North America (www.m-e-f.org) with a remit to develop mobile commerce best practices and advance commerce security and privacy (for which he received a MEF award for industry excellence). In 2011, in partnership with MEF and a number of industry groups including the X9.org security standards body, Gary is working to develop m-commerce security and privacy guidelines.

Gary it the recipient of the Asia and Japan Foundation Fellowship as well as the Macromedia People Choice Award and Dodge Foundation award for innovation. Gary is the author of the mobile industry book, The Impulse Economy, published by Simon & Schuster.