Mobile Analytics

As we have come to find, agencies are often at the mercy of the whims of their clients when it comes to mobile marketing.  Because of the perception – right or wrong – that a mobile campaign such as one featuring an SMS text message call to action is a single project with a limited life, the ultimate benefits of mobile never have a chance to accrue.  Those benefits include the ability to collect interaction data, often across  both SMS text message interactions as well as email and web, and create essentially a mobile datamart containing a goldmine of customer data that agencies often NEVER have access to.

As I blogged about recently, mobile technology firms have the potential to cut agencies out of the loop as more businesses become comfortable and able to work direct with point solution providers to execute their mobile marketing plans.

Why more agencies don’t adopt the viewpoint of mobile as a means of collecting data about their client’s customers, and use that insight as a basis to pitch new business, is beyond me.  Without much thought, imagine:

• Client wishes to employ a mobile sweepstakes as a novel means of driving interest in their products during a slow period.  Client measures an improvement in sales correlated to the client’s locations by virtue of collecting customer zip codes as part of the process.  This data could be obtained easily via SMS text message interaction or via a web form which feeds the same datamart.
• Result?  Value proven, but apparently many agency clients stop there.  Instead, imagine:
• Agency strategists analyze information captured during the promotion in the datamart and discover distinct segments of customers.  Entry into the promotion required customers to provide some very simple demographic and preference details such as gender, marital status, and product affinity.  The agency’s client is constantly striving to increase same store sales by creating offers and promotions that align with their targeted customer but these tend to be very broad brush efforts which often take the form of a mass media effort.
• Agency strategists pitch the idea to re-target the identifiable segments with “buy one/get one free” offers aligned with insights from the datamart.  Client wonders how redemption will happen at the point of sale, how value will be tracked.  Unable to currently capture these offer codes at the point of sale due to technical and operational limitations, the agency prescribes a novel solution – simply inform store managers to expect the offers to be presented and instruct cashiers to honor them.  Post promotion, month over month sales per location can be analyzed related to the distribution of the offers by zip code.  In this way, an indirect yet very strong correlation between the promotion and sale can be established.
• Result?  Value indirectly proven yet the client must certainly be happy having taken a data driven approach to marketing as opposed to a “pray and spray” mass media method.  The client also now has a good sense for its most engaged customers.  Having seen the power of mobile centric marketing, the client decides next to implement a loyalty rewards program:
• The client, now on board with the notion of mobile marketing, calls the agency team to create a loyalty program that initially targets customers by zip code where sales increased the most during the “buy one/get one free” promotion.  These customers are invited to join via SMS text message, and do so by visiting an online web form on the client’s website where more details about their preferences and interests are captured.  These in turn trigger unique initial offers designed to drive more frequent visits and greater market basket value based on business rules established (e.g. mother with two children gets offered product X, single guy age 25 gets offered product Y).  Wouldn’t you know it, but the client recently upgraded its POS systems and the field operations team is no longer averse to extending the checkout process with mobile offer code redemption.  Now, redemption by these very loyal customers can be tracked directly.
• The client advertises membership into the club on its website for anyone to join at a cost – the free offer was only extended to those who participated in the earlier promotion.  These new customers who pay to join, are similarly presented with offers aligned to their interests.

I could go on, but hopefully agency readers and their clients get the point.  Mobile marketing is not about a one-time campaign – it’s a unique opportunity to reach your customers with their personal devices in ways that drive sales and loyalty.  To take any other approach is wasteful, shortsighted, and spells death for any agency hoping to compete for mobile budgets.

I told my colleague Julian Rockwood that for me, the success of today’s Mobile University event was based on whether or not I came away with some new information that I could really use.  As I write this, I am attending a breakout session titled, “Metrics – Measuring Consumer Engagement of a Marketing Program,” and the content of this presentation clears my success hurdle by a long shot.

While much of the early event content focused on the magnitude of the mobile marketing opportunity, this session was all about what marketers should expect, in terms of hard results, based on real world experience.

The presenter is a consultant focusing mostly on the quick serve restaurant (QSR) and multi-location retail markets, but the insights presented here should provide valuable targets for anyone new to mobile or more experienced practitioners looking for something to compare their results to.

I’ve summarized the content I found most valuable, and suspect would be as well to any mobile marketer.

Start Simple

• Create and grow your mobile subscriber base FIRST: Use events, point of purchase incentives, email, and integrating calls to action into existing media buys.
• Understand your customer: Implement tracking, build analytics, poll your members, begin mining the database for trends.  Engage in creative ways to uncover more than just a mobile phone number, such as short surveys.  A maximum of 4 questions is about what the average consumer will answer via SMS text message interaction.  Good survey oriented campaigns yield 43 percent response rates, and of those who do opt to participate, completion rates exceed 90 percent.
• Market One-to-One: Marketers make the mistake of focusing here initially. The benefits of one to one marketing accrue based on establishing solid practices around the preceding two activities.  Sending individually targeted offers, creating profiles of customers to deliver content they want is what happens here.

Mobile Ads are Hype/Lack Reach

• The mobile ad ecosystem is too complex for the average marketer.  All display advertising, the kind that is very engaging, is all happening on the iPhone and Android, both of which pale in comparison with the market share of phones capable of sending and receiving text messages.

Advice to Mobile Marketing Services Providers

• Talk to the market thru SMS, lead with it, because all marketers are drawn immediately to promises of expansive reach for reasonable cost.  If alternative mobile marketing approaches are desired, such as applications or mobile web, so be it, but these offer far less reach than SMS.

5 Flavors of Engagement

• Banner and display ads
• Text messaging
• Mobile search
• Commercial Applications
• In Application/Games Ads

Engagement Metrics

• Member growth rates
• Opt in and opt out rates
• Viral growth rates per engagement
• Redemption rates
• Average sale per redemption
• Average engagements per month
• Cost per redemption
• Cost per engagement
• Cost per member
• True ROI for the overall program

Media Buy Effectiveness in Supporting Mobile Programs – From Worst to Best

• Billboards
• Radio
• Sports venues/events
• On site ambassadors
• TV
• Festival or parade
• Print
• In store signage (posters, table tents, etc.) – 90 percent success keeping subscribers opted in who are acquired in this manner

Use Email to Create Mobile Fans, Not the Other Way Around

• Use your email list to promote mobile campaigns, achieve a 20 percent join rate

What to Expect in terms of Results

• 250 members per location (retail/QSR) in 90 days is average
• 500 members per location in 90 days is exceptional
• 700 members per location in 12 months is average
• 1200 members per location in 12 months exceptional

And remember, even if the total universe of subscribers appears small, these represent your most loyal customers.

For context, consider that average QSRs generate approximately 20,000 unique customer visits per month, exceptional cases like McDonald’s obtain around 40,000.

Houston, We Have a Problem

If opt out rate exceeds 10 percent, you have a problem with the program.

Typical Offer Redemption Rates by Medium (i.e. coupons)

• Mobile 7 percent
• Email 1.12 percent
• Paper Coupons 1.18
• Direct Mail 1.12

I was recently forwarded a copy of a Forrester Research report titled, “The Marketing Accountability Index,” that describes an approach for marketing organizations to assess the extent to which their actions are measurable and accountable in ways relevant to other business stakeholders.

With marketers more accountable that ever, many are drawn to the built-in measurability of mobile channel interactions – as illustrated in this recent post where we outline mobile metrics tracked by our Engagement Platform.  We state these in terms all marketers identify with because they are at the foundation of marketing measurement:

• Stickiness – A measure of retention
• Acquisition – Permission indicator
• Loyalty – Propensity to engage
• Response Intensity – Relative measure of engagement
• Reach – Indicator of scale
• Engagement Mix – Relative engagement contribution

Viewing mobile metrics in this way helps marketers relate the mobile channel to stakeholders in other aspects of business who don’t want (or need) to understand intricacies around opt in/opt out rules, keyword campaign segmentation or the differences between Mobile Terminated (MT) and Mobile Originated (MO) messages.  The Forrester Report includes a diagram — included in this post – into which these mobile metrics fit quite clearly.

Mobile marketing can be about text messaging or smartphone applications, but for mobile to take hold as a strategic component of business, marketers need to work diligently to relate channel-centric concepts to mainstream marketing metrics to communicate value.

At Interactive Mediums we describe our value proposition as helping clients engage their customers in the mobile channel in revenue and profit producing ways.  Key to successful mobile marketing is having access to a variety of best practice mobile-optimized campaigns — or Engagement Actions — such as sweepstakes, surveys, polls and others.  Just as crucial are the metrics used to track mobile marketing efforts to gauge success but also improve efforts over time.  To those ends, our Customer Engagement Platform includes a variety of interactive reporting capabilities that lend insight into the effectiveness of mobile marketing campaigns.  Following is a summary of the metrics and reporting capabilities offered by our Platform:

Metric: Stickiness
Within the context of SMS text message mobile marketing, stickiness refers to the ability of a campaign to hold onto its opt in subscribers, such that customers may be targeted repeatedly over time.  The utility of a call to action has a great deal of influence over how many customers elect to opt out of your list.  Marketers want to see the trend in this analysis track positively over time as an indicator of stickiness.

Metric: Acquisition
Marketers need to view as a significant “win” the permission provided by customers to engage in text message interactions.  At-a-glance, marketers can instantly view the magnitude and trending for acquiring subscribers, by campaign.

Metric: Loyalty
Although referred to as “Retention,” this measure offers insight into the “mobile loyalty” of your customers.  Opting into communications is different from subscribing to receive messages proactively.  This view offers insight into the relative number of customers who have opted in that also elected to subscribe to a campaign.  Marketers can interpret this as an indicator of consumer receptiveness to mobile engagement, much as loyal customers engage in repeat purchase behavior.

Metric: Response Intensity
The ratio of messages a marketer sends versus those responded to by customers can be used to evaluate calls to action as contributing to mobile engagement.  MT, or Mobile Terminated messages, are those sent by the marketer.  MO, or Mobile Originated messages, are those sent by customers.  The greater the number of MOs for a given MT indicates superior engagement for a campaign.  Viewing MOs in isolation quickly across all Engagement Actions provides instant insight into the campaigns working best to pull customers into mobile interactions.

Metric: Reach
The value of SMS text message marketing is often described as offering universal access to consumers.  This is realized by analyzing the number of subscribers to a particular campaign, which is shown by keyword.  Keywords are how marketers connect their customers with mobile interactions and so viewing the aggregate number of subscribers per keyword illustrates the reach afforded by a campaign and its call to action.

Metric: Engagement Mix
Increasingly, mobile interactions are becoming “multi-mobile” in nature, inclusive of both SMS text messaging and the web (both mobile and desktop).  It is therefore crucial for marketers to have a single view into the interplay among these channels as part of mobile campaigns.  This analysis provides insight into the mix of distinct interactions stemming from text and web, which illustrates customer engagement channel preferences.

Just like mobile, investments in social media marketing are growing but quantifying the value of social can be a lot harder given its more subjective nature.  Yet, many forward thinking marketers are taking advantage of the popularity of social networks in line with quantifiable mobile interactions.  Dunkin Donuts is one such example highlighted in this March 26, 2010 post on the Digital CPG Blog.

Dunkin Donuts’ Twitter efforts:

“…include tracking customers that sign up for the company’s rewards programs and sweepstakes offers via Twitter, and assigning a dollar value to those customers that can then be tied to an actual ROI.”

The ease by which this is possible using solutions such as Interactive Mediums’ Customer Engagement Platform across SMS text messaging and the web makes these practices an essential component of any social media strategy.  As shown in the attached recent “Tweet” from the Dunkin Donuts Twitter page, broadcasting a contest to followers which incents them to purchase can also be used to collect valuable information about followers otherwise unavailable to marketers.  The opportunity for engagement encompasses both action (purchase) and knowledge (follower demographics).

In case you doubt the mobile nature of Twitter users or the value of understanding the audience, consider research into the Twitter user base:

“Since Twitter is pushed as a service that can (and should) be used from mobile phones, it also comes as no surprise that Twitter users are more likely (by fairly significant margins) to use their cell phones to go online and send text messages than the overall online population. In fact, Twitter users tend to use and consume all sorts of media more than the rest of the population; they’re more likely to read a newspaper on a smartphone, regular cell phone, and even online than everyone else, while “regular” Internet users are more likely to read a print newspaper. Twitter users are more engaged in blogging and reading other people’s blogs as well.”

Research into Twitter users from mulitple sources is consolidated in a post here, where it’s noted that: “Twitter are notoriously guarded about user information and Twitter usage statistics,” placing the onus on social media pros to develop creative ways of understanding their fans.

An article on Intelligent Enterprise titled, “Wendy’s Taps Text Analytics to Mine Customer Feedback” caught my eye today as a potentially interesting application of SMS text message feedback systems such as surveys.  After all, the most accurate and meaningful feedback a consumer can provide is often communicated as close to the time of service as possible – which is a perfect fit for text messaging.

One sign in every store pointing consumers to text their comments to a shortcode could act as a highly effective and efficient feedback collector – especially when paired with entry into a loyalty program.  Response rates for text message programs have commonly been reported as high as 30 percent.

According to the article Wendy’s staff will be able to:

“…analyze nearly half a million text-based customer comments per year collected from Wendy’s Web-based feedback form, call center notes, e-mail messages, receipt-based surveys, and social media sources. The chain’s customer satisfaction team currently uses the combination of spreadsheets and keyword searching to review comments in a slow, manual approach.”

Notably absent that list of collection points is text messaging.  Not only are barriers like 160 character limits broken with multi-question survey capabilities such as those offered by the Interactive Mediums Customer Engagement Platform, but data can be collected via web form and feed the same database as well.

Quick serve restaurants of all stripes should leverage once obscure analytic technologies like text mining, and would be wise to tap into the immediacy of text messaging as a key data source.

Having been in meetings with marketers and via anecdotal third party comments, I know many are sitting on the fence with respect to mobile, uncertain whether it’s a novelty, tactic, strategy, channel or alternative to email.  For better or worse, it can be some or all of these.

When you add to this mix that many businesses are reaping mobile marketing benefits, as shown every day on MobileMarketer.com and other sites, marketers in all industries sense urgency to at least try mobile marketing – be it developing a mobile optimized version of their website, an iPhone application or trying to employ SMS text messaging simply due to its reach.

I think this is the landscape documented in research covered today on eMarketer.com, in an article titled, “Mobile Marketers Demand ROI.”  Results of a survey suggest marketers will pursue mobile marketing efforts in 2010 – even allocating budget – but obstacles remain (as shown in the diagram included in this post).

“It appears that 2010 will be a year of experimentation and education on mobile marketing as marketers struggle to come to terms with its practicality and ROI.”

The greatest challenge – not surprisingly – is uncertainty around building the business case for mobile marketing, followed closely by a lack of ROI metrics and mobile not a part of the “strategic roadmap.”  I’d argue all of these issues fall under the heading of simply “I don’t know where to start, given my business, my product or service and customer base.”

For this reason, Interactive Mediums developed an exercise called “Mapping Mobile to Your Marketing Strategy,” that when complete identifies the best candidate projects that align with your existing marketing plans and channels.  This is based on our direct experience and observation of the ways leading companies are going to market with mobile as strategic elements of their business.

Taking time to experiment and educate is simply not an option for marketers given the pace of advancement among leading mobile marketers.  Even trialing various approaches will leave you behind the curve as competition for consumer mobile mindshare escalates.  Taking a thoughtful approach to mapping out a strategy can ensure your business plays a role in the mobile customer relationships that will surely separate the winners from losers.

I once before blogged at taking pleasure in reading contradictory views on important goings on in the mobile industry, and much to my delight (or chagrin) it has happened again.  It’s important to highlight and interpret these cases, as both savvy and novice mobile marketers look to supposed experts to help guide their decisions.

On one hand you have this February 4, 2010 post on MobileMarketingWatch.com citing expert commentary from a recent event, where the consensus view was that mobile advertising was “harder than ever…citing extreme fragmentation and a plethora of new devices sporting varying technical aspects as the main culprits.”  The situation sounds intimidating to say the least, begging for a wait and see approach.

Juxtaposed with this is research cited in a February 5, 2010 article in MobileMarketer.com titled, “Mobile ad campaigns 5 times more effective than online: InsightExpress study.”  Based on the title alone, you can imagine the article describes how much more effective mobile advertising is today than its online counterpart.  And that is the case.

You can read about the differences in effectiveness but it all comes down to “engagement and context” according to the study, both of which we describe as central to mobile marketing’s value proposition, be it a focus on advertising or direct engagement via SMS text messaging, email and mobile web.

I think the disconnect between “experts” and the facts on the ground is due to control; advertising networks are the gateway to this value while many experts working on the boundaries are left struggling for relevance with end customers who have cash to spend.  Marketers would be wise to quickly discern the quality and subjectivity of viewpoints they consider when prioritizing mobile marketing efforts.

2009 marked the beginning of an effort at Interactive Mediums to keep watch on the mobile marketing industry and lend our unique perspective on happenings as they relate to the value we bring to our clients.

The pace of innovation in mobile and urgency to begin engaging customers in mobile interactions demands we pay attention to news of the day.  More importantly is that we have a relevant point of view.  Hello Mobile! is our forum for communicating these views.  Others are listening as well, such as MobileMarketer.com which today recognized our article “9 Steps for SMS Marketing” among the “Top 15 industry-expert columns of 2009.”

As 2010 begins, look for further insights, commentaries and directives from our blog.  Before we look forward though, here are the top 10 most popular posts of 2009 – I wonder what this list will look like next year, the key trends and topics?  Stay tuned.

• Is Apple the Mobile Walmart?
• The Key to Mobile Customer Data
• Acxiom Clients Seeking a Differentiated Mobile Offering Should Look Elsewhere
• Advice to Marketers: Don’t Confuse Mobile Advertising with Mobile Marketing (or Active Customer Engagement)
• Establishment Converges on Active Customer Engagement
• Lessons From Less Than Successful Mobile Apps
• Thankfully, More about Active Customer Engagement
• Vendor Lines Blurring but One Thing is Clear: Active Customer Engagement
• Insight into Apple’s App Store approval process
• Best in Class Marketers to Focus on Customer Engagement in 2010

Today I came across an interesting post on GoMoNews.com about the emerging challenges associated with measuring the effectiveness of mobile advertising; specifically tying results from different ad networks together in a consistent manner such that they can be compared.  The post recommends that ad networks begin offering APIs (application program interfaces) such that the raw data can be accessed by clients and then massaged into a consistent display for assessment by marketers.

While that sounds like a terrific step or opportunity for consulting firms, as I point out in a comment on the post I don’t see many marketers taking advantage of APIs to this end.  Instead, I see:

• Marketers partaking in mobile advertising across multiple networks without any expectation at resolving the metrics across them, at least not at first.  All forecasts predict that mobile advertising will explode in the next few years, suggesting marketers are either unconcerned or unaware of the issues described in the blog post.
• Because marketers generally are drawn to mobile because it is among the most trackable and accountable channels, they soon may bump into the metrics integration issue.  Those marketers who do will fall into two camps: those who lack the resources or business case for integration regardless of API availability and those who will integrate because mobile advertising directly supports sales.

Let me explain: Many businesses utilize mobile advertising for awareness, branding and demand generation.  If resolving metrics across networks becomes an issue, I expect many marketers to narrow their network partners to one or two that offer access to the most targeted group of potential customers – to undertake an integration exercise is simply not worth the effort.  Other businesses that can drive sales via mobile transactions, however, will find it imperative to integrate metrics and tie these back to sales since the advertising directly supports the business.

With awareness/branding and demand generation representing arguably the largest mobile ad market opportunity, it suggests that mobile networks as a segment will narrow to 1-3 leaders with others either acquired or rendered irrelevant.  Thus, pretty quickly a consistent view of mobile ad metrics should happen almost automatically.

When it comes to engaging customers in the mobile channel, there is a strong analogy.  A single system which allows marketing objectives to be tailored to the mobile channel, executed and tracked, should be high on marketers’ priority lists in 2010.

Technology-wise, I am talking about SMS text messaging, mobile optimized websites, mobile applications, mobile email and social media.  In practice, marketers enabled with a solution that stitches each of these together will have a significant advantage over those who don’t.

For example, imagine engaging your customers via SMS text messaging, let them forward the invitation response to their Twitter followers, send text responders a thank you email, point them to a mobile website to redeem a coupon or to download a mobile application designed for their handset to enhance the shopping experience.  And, track this activity across all these mobile channels in a single system that easily integrates with the only system that matters — the one registering sales.