Real-time location-based services: A new opportunity for loyalty marketers?
Brands with established reward schemes can generate a network of ‘brand ambassadors’ with location-based marketing software currently being developed. The high profile mobile social network/game FourSquare has been in the news almost constantly since signing up its first national brands in Debenhams and Domino’s Pizza.
Article by Kevan Christmas, digital and mobile consultant at The Collinson Group and Collinson Latitude.
There has been an increasing level of interest and debate in the topic of real-time location based marketing and this will only increase as Google and Facebook enter the space in a serious way.
That said, I have been surprised at how little of the conversation has focused on the opportunities this new technology creates for brands with established customer loyalty and reward programmes.
For example, the mobile social network/game Foursquare (right) has been in the news almost continually since signing up its first national UK brands – Debenhams and Domino’s Pizza. The app detects players’ whereabouts and when they visit the store or restaurant they gain points for ‘checking-in’.
Brands get involved by offering deals to users based on, for example, the number of times someone ‘checks in’ to their local branch. Businesses get increased footfall, and ideally, a network of brand ambassadors who will pass on recommendations. The consumer gets great deals that are relevant not only to who they are, but where they are. – e.g. Debenhams giving Foursquare members a free cup of coffee in the restaurant when they check in.
It’s no secret that smartphones and branded applications are an incredibly cost effective way of targeting and engaging consumers. By creating tools your customer base can download and use on a regular basis, you can engage, add value and integrate with their lives in a way that advertising never has.
Some of the software currently in development, particularly in the travel sector, illustrates the potential of the next generation of apps that can use smartphone’s GPS capabilities in a way that enables brands to hit a moving target.
For example, products will soon be available that offer travellers a web-based suite of services that help them plan, prepare and manage their whole journey. Other capabilities include itinerary planning, destination content, check-in services, miles management as well as airline timetables and flight status texts – a kind of travel toolkit. The majority of these products will be enabled with an iPhone application, so travellers will be able to carry on planning and managing their trips on the move, even when offline, so there won’t be any expensive data roaming charges.
The key insight here is that loyalty programmes should connect with all the different stages of the customer journey, from planning to booking, and from departure to arrival. Mobile technology can actually be viewed as a very direct way to plug in to that journey, wherever the customer may be.
What this means is brands can now have a good idea of where the customer is going to be and when, as well as knowing how much loyalty or reward currency they have. This can be matched against the various outlets that their reward programmes have affiliate marketing relationships with. Also, as the customer loyalty programme provider, brands already have a huge amount of customer data, including payment information. As a result the mobile device could actually be used, even offline, to facilitate some of the purchasing processes.
Say, for example, the customer uses a mobile app to find the nearest hotel where they can spend their loyalty points, they could actually book a room and check in via their smartphone. A key principle of properly developed reward programmes is that they use as much customer insight as possible to make sure that the services and products offered are exactly what the individual wants and needs. This data should be used not just to meet customer expectations, but to exceed them.
Sending relevant messages
This approach, called ‘intelligent monitoring’, should now form a key part of any brands loyalty development strategy. Previously brands have been able to narrow down the offers made to customers according to their pre-arranged travel plans, but now they will be able to target people based specifically on where they are with this next level of customer insight. So whilst you have a captive consumer waiting in duty-free, this can be directly integrated with your loyalty programme, offering them ways to redeem their points just as they are walking past a retail outlet you are partnered with. Moreover, based on their intinerary, specific products could be offered that are relevant to where they are going.
Utilsing these highly accurate GPS capabilities will also create new data, with new patterns emerging of how your customers behave when on the move. It is effectively an entirely new way to observe consumer behaviour, and should potentially lead to us being able to pre-empt customer needs specific to where they are.
However, just as your communications with the customer must be relevant to what the customer actually wants, so must your offerings match your brand values and what the specific objectives of your loyalty programme are. That could be looking to reward and encourage high spenders, get low users to spend more, motivate your customer base to use more of your wider service and product offerings, and so on.
Finally, I think there is a real opportunity for reward programmes to use peer based social media capabilities. So instead of the app just saying ‘here are the closest five car hire outlets where you can earn or spend loyalty points’, it could say, ‘here are the top three in your vicinity according to ratings provided by your fellow gold card holding members’. Providing scores, notes, suggestions, related recommendations and so on from a group of people who have similar tastes, aspirations and levels of affluence creates a great deal of trust and authority. Obviously companies like Amazon have been doing this for years, but connecting it with your reward programme via mobile technology takes the concept to an entirely new level of relevance, utility and engagement.”