Making mobile customers loyal
How mobile phone technologies are injecting a new lease of life into loyalty programmes. Article by Peter Larsen, Managing Director Europe for Enpocket. 
On opening my wallet and rummaging through my desk at home a few weeks ago I realised that over the past few years I have amassed no less than 11 loyalty programme cards! The majority of these never leave the house and most have never been used.
On further inspection of my ‘random junk’ drawer I found a mass of tokens from supermarkets and department stores that I had completely forgotten about. What a waste of paper and plastic. But more importantly for the companies running these schemes it represents a missed opportunity and a sign perhaps that consumers are experiencing loyalty programme apathy.
I realise that I am not the only person who does not have enough space in their pockets to carry around the huge amount of loyalty paraphernalia regularly pushed on customers every day.
Mobile technologies offer a means of conquering this apathy and of putting your loyalty card in the customers’ pocket without weighing them down any further. At the same time by establishing a presence on the most ubiquitous consumer device that is always on and always carried, your brand can stay at the front of the customers’ mind.
Consequently most major retailers are now examining what mobile can do for them to build loyalty for the long term. Mobile programmes can range from a simple SMS voucher scheme, through to a sophisticated application that sits on the mobile device and acts as the loyalty card and redemption channel.
It important to point out that at this stage that anyone planning a mobile loyalty programme of any kind must only communicate with customers who have opted-in specifically for that programme. Otherwise you are more likely to alienate customers, as oppose to building loyalty.
The first wave of mobile loyalty has predominantly involved SMS / text messaging. With over 9 out of 10 mobile owners using SMS regularly, according to an independent Enpocket Insight study, it’s clearly a mainstream medium that virtually everyone understands. With only 160 characters of text to play with, creatives have had to ensure that messages are succinct and provide a clear call to action.
SMS vouchers have been one effective way of driving footfall and building loyalty. Consumers always have their mobiles with them and this removes the problem of forgetting the necessary coupon.
HMV recently teamed up with London records for the launch of the recent Holly Valance single ‘State of Mind’. Music fans simply texted in to a five-digit number, advertised in the press and on television, to receive a SMS voucher for the discount.
Mobile services provided by Shazam added an extra element by sending a voicemail from Holly that allowed mobile users to listen to 30 seconds of the song.
Mobile loyalty doesn’t have to be limited to the youth market and mobile coupons though, as William Hill has proved. It has built up a base of thousands of customers who are sent SMS alerts on sporting news and the latest odds. By using sophisticated profiling technologies it only sends alerts on relevant sports to individual users and provides contact details within the text depending on the user’s preference for phone, in-store or Internet betting. With all this relevant information at their fingertips customers are far more likely to call on William Hill than any of its competitors.
With the mobile user now graduating to more visually rich technologies than text, companies are quickly following suit.
Electronic Arts, the video game producer recently worked with GAME, the high street game retailer, on the first MMS coupon campaign. MMS (multimedia message service) allows for graphics and audio to be included within messages. EA offered opted-in consumers the chance to get £10 off the most recent James Bond game ‘Everything or Nothing’ through a unique MMS coupon that also allowed the message to be branded and included graphics depicting the iris scene from the opening credits of James Bond films. This programme has had exceptional redemption rates.
Next-generation loyalty
The consistent increase in the number of mobile users familiar with new technologies means that the mobile phone will, in some cases, replace traditional club cards in years to come.
Instead of producing a card, a branded application can sit on the mobile phone and act as a virtual club card. When opened at the till it can be used to collect loyalty points, redeem special offers and even to manage accounts when the consumer is away from the retail outlet. As well as making life easier for the customer, the interactive interface helps organisations to collect more detailed information on consumer behaviour.
A user might have numerous club cards on the mobile that are simply opened when in the relevant shop. These link into back-end and EPOS systems like any physical card does. And again it’s a useful channel for voucher / mobile barcode redemption, as well as for product registration and data collection.
Successful loyalty programmes need to start communicating with consumers on their own terms and in a manner that is practical and easy to use. Customers will increasingly disregard loyalty programs if it means carrying around yet another card and receiving mountains of information through the post, perceived by many as junk mail.
When a customer leaves the house what are the three things they never forget? Number one is surely their keys, number two, their wallet, third their mobile phone. They want to minimise the amount of things they carry, so customer-centric retailers need to take this into account and provide the most efficient, compact and useable loyalty format available.
Mobile technologies can keep loyalty alive by giving retailers a channel that customers actually want to use.
Peter Larsen, is Managing Director, Europe for Enpocket, the leading mobile marketing solutions provider.