SMS Text Message Marketing Archive

Today Retailwire.com highlighted a March 12, 2010 post by a firm called Compete about its research into consumer acceptance of various mobile advertising tactics.  I thought this was worth mentioning for a number of reasons, but mainly to highlight the distinction between mobile advertising and mobile engagement – which are really two separate ideas that get co-mingled in this case.

For retailers in particular, it’s important to separate engagement from advertising; the former is interactive by definition, the latter more static/one way communication, even when targeting a particular demographic.

With respect to mobile ad acceptance by consumers, the research found:

“…we saw consumers were most interested in receiving grocery coupons (36 percent), scanable barcodes (29 percent), offers to save and pursue at leisure (26 percent), movie theater offers (26 percent), and ads via SMS when going by a retailer with a promotion / coupon (21 percent).”

The means by which these “advertisements” are delivered to mobile consumers is typically via SMS text message interactions initiated as part of customer engagement strategies.  Engagement itself is the real opportunity presented by mobile channel marketing, which the research also highlights as shown in the chart included earlier in this post.  The research dovetails with a diagram we have been using (at right) to illustrate the personal nature of the mobile channel relative to other advertising and marketing methods that also present fewer opportunities for engagement.

Be it coupons or special offers, these calls to action should be viewed not as advertisements, but rather part of engagement strategies targeting consumers receptive and available to receive them in ways not possible in other media.

Marketers and their agency partners always seem to have smartphone demographics top of mind when discussions turn to mobile projects, and rightly so.  Until such time that applications are as universally accessible as on desktop computers, marketers need to make choices with respect to mobile strategy.

This article today on AdAge.com presents some generalizations to describe typical smartphone users:

iPod Touch: “The Touch user is young — according to AdMob, 65% of iPod Touch users are under 17 — and likes to game and listen to music.”

Blackberry: “The BlackBerry user is still very much a business user who uses the phone primarily for e-mail, instant messages and viewing attachments.”

Android: “According to Nielsen, 33% of Android users are single and, by Ad Mob’s count, 73% are male. Millennial’s Mr. Startzel calls it the ‘tough, terminator-like robot phone…’”

iPhone: “The iPhone user is tech-obsessed, wealthy and is less likely to have kids than other smartphone users… iPhoners are also using the device for much more than e-mail or messaging and are very active web surfers. They’re also more likely to buy things from their phones, download apps and content, according to Nielsen.”

While certainly good to know, such information doesn’t paint a full picture.  No matter what the generic user profile for a particular smartphone device looks like, it’s important to also consider whether or not consumers perceive a particular device as a viable application platform.  Although Google Android device shipments have been strong and are capable app platforms, the available market for applications pales in comparison to Apple’s App Store for the iPhone.

Right or wrong, currently the iPhone is perceived as the mobile app platform for consumers, due as much to its features and capabilities as the hundred+ thousand applications currently offered.  Some marketers invest in iPhone apps to reach their target demographic, others for the publicity which can accompany novel or interesting apps regardless of how well they are aligned to buyers.

Where trade-offs are not required is with SMS text message marketing programs.  These not only offer universal reach, but provide marketers the unique opportunity to learn more about their customers via direct engagement.  Marketers are not afforded the luxury of knowing who downloads their applications.

At first glance, this article yesterday on DMNews.com suggests the one area of mobile advertising thus far overlooked – audio – represents an untapped opportunity for marketers to reach their customers in ways other than text messaging, mobile applications, social media or mobile web browsing.

An internet radio network has supposedly created an advertising product allowing marketers to target listeners with audio commercials in line with station content, according to geography, demographics and device.  Radio advertising tends to be a mass market medium, so this appears to offer marketers the chance to target different audio messages to various listener segments.

Keep in mind, however, that the opportunity for marketers is limited to whatever content the network provides.  The use of mobile devices for audio in general is on the decline and audio messages lack the direct response element of a text message that incorporates a live link to a mobile website or application.

Radio stations have the opportunity to offer a platform for one to one marketing on a completely different scale via text messaging, as outlined in this recent Interactive Mediums paper titled, “Transforming Listeners into Dollars.”  Radio stations can use text message interactions as a means of building out profiles of their audience to offer highly segmented ad units which can drive more revenue.

With respect to the mobile channel, radio stations and their advertisers alike need to separate the notions of offering the usual audio commercial on a device from targeting relevant offers and calls to action via text messaging.  No matter how targeted audio ads become, they cannot facilitate the capture of audience demographics and lack the direct response component of text messaging.

All retailers to varying degrees are dabbling in mobile couponing as a means of engaging their customers, driving foot traffic and ultimately selling more product.  The technologies employed vary from a numeric code delivered via SMS text message through actual digitized bar codes that render on a mobile device for scanning at the point of sale.

Each of these options today represents a compromise over traditional printed coupons that most point of sale systems recognize.  Coupon codes requiring manual entry lengthen checkout time and can be error prone while mobile device displays cannot always render codes compatible with POS scanners.

Despite these limitations, retailers are pressing forward to take advantage of the value presented by location-based marketing.  Yet to really unleash the value of mobile couponing, it must be ubiquitous and require a minimal change to retailer operational processes in order to be cost effective.  That’s the thought which came to mind when I read a February 19, 2010 item at DMNews.com, titled “Provision Interactive Technologies teams with Ping Mobile for in-store mobile campaigns.”

The article describes a new offering as follows:

“Marketers can create an out-of-home/mobile campaign in a mall, airport, stadium or other public venue, and consumers can respond to the call to action on the signage by texting in. Coupons, tickets, vouchers and other printed items then become available from Provision’s 3D Media Centers, which consumers can print the coupons at the kiosks and redeem.”

Rather than focus redemption around legacy POS systems, this approach represents a value added intermediary that could be positioned in retail environments in a standalone fashion – the quantity of stations limited only by space and budget.  The solution is described as optimal for “malls, airports and other public locations,” but should have equal or greater value when resident in a single retail environment — especially for large retailers with hundreds or thousands of locations unable to upgrade all POS systems en masse.

This solution also alleviates the need to worry about technology and compatibility issues, and focus instead on creative ways of engaging customers with the most relevant offers.  Interactive Mediums’ Customer Engagement Platform features a variety of pre-packaged engagement actions designed just for this purpose.

The news seems to be increasingly populated with stories about 2D or “quick response” codes used as mobile calls to action.  As this article points out today on MobileMarketer.com, “bar codes offer a shortcut to accessing mobile content, information and mobile commerce.”  Considering the simplistic analogy to a shortcut, it’s rather amazing Neustar is attempting to solve the reach/incompatibility problem of 2D codes and in so doing add a presumably high growth aspect to their business.

The article outlines how Visa used 2D bar code technology as part of a sweepstakes promotion conducted at the recent Mobile World Congress in Spain.  You can read the specifics but as we mentioned recently here and here, 2D bar codes tend to find the greatest success in highly localized and controlled environments where there is some certainty around consumer handsets capable of reading the codes.

What Neustar wishes to do is offer a “clearinghouse” service so marketers can employ 2D codes without restricting their potential audience.  They plan to do this by standardizing previously incompatible codes across devices and operating systems.  It sounds like a lot of work to enable consumers a “short cut” to redeem information on their mobile devices.

2D bar codes appeal to our visual nature and longtime experience with traditional bar codes such as those scanned at the grocery store.  These codes imply ease of use, as well as data — lots of data about who purchased what product and when.

Marketers considering building sweepstakes or other promotions around 2D bar codes like Visa should consider the ease by which consumers today text a keyword to a shortcode to redeem information or be pointed to a mobile website – the exact same use case as with a 2D bar code.  Not only are you assured universal reach but even more data about the consumer can be obtained since a text interaction is bi-directional and can include a question and answer component in real time.

Marketers should focus less on the technology employed to engage their customers, and more on creating a compelling message or incentive which calls their customers to action — and then evaluate options for packaging and delivering the offer.  Right now marketers appear blinded by the “sexiness” of 2D bar codes, and Neustar is betting a new line of business on it.

2D barcodes and their imitators are likely to be among the biggest failures of 2010, at least among marketers who use these technologies expecting to achieve direct response rates like those of SMS text message programs.  That’s both a prediction and more strongly worded follow up to this recent post of ours regarding services claiming to offer 2D barcode benefits but that are consumable by nearly every mobile phone user.

Those benefits include ease of interaction; simply point your camera-equipped device at a code to have information immediately presented and/or be pointed to a website.  In localized programs outside the U.S. 2D bar codes have proven successful.  However, as pointed out in this very good post, standardization among devices and software (or more accurately, a lack of it) is a gating factor to widespread accessibility by consumers in the U.S.

“…2D barcodes…are pretty cool solutions for specific applications, such as mobile airline boarding passes or advanced inventory management, but not exactly the best of what’s out there for mobile consumer marketing in today’s rapidly changing world of mobile media and brand interaction.  The name of the game is to get as many high-quality customer interactions and conversation engagements as possible with your targeted demographic.  Severely limiting the potential response pool by applying restrictions will simply decrease the success of the campaign.”

Articles like this on ChiefMarketer.com present a different picture that marketers would be wise to balance against the facts on the ground.

The universal nature of SMS text messaging has created an impression that mobile marketing can access anyone, anytime and anywhere but until technologies like 2D bar codes and augmented reality are as “standardized” as SMS, text messaging will remain the defacto method of reaching as many of your target demographic as possible.

In the meantime, hybrid services requiring a consumer to snap a photo and send it via MMS are emerging that ultimately lack the instant gratification of real 2D codes and the universal nature of SMS.  Marketers be warned.

With competition for mobile consumer mindshare reaching a fever pitch, marketers will increasingly face an engagement barrier, even around SMS text message programs.  To break through and achieve their objectives, marketers should evaluate offerings such as Interactive Mediums’ multi-channel mobile customer engagement platform.

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.

For companies that offer SMS alerting capabilities (including Interactive Mediums) and their customers, results like those cited in this January 29, 2010 MobileMarketingWatch.com post are proof positive of the value of text messaging:

“…a pilot SMS reminder solution…ended with unprecedented results – saving Kaiser nearly $150 per appointment and over $275,000 at a single clinic.”

Efficiencies and costs savings were at the heart of the value in this example, which is apparently driving consumer acceptance of text message alerts – the post’s title is after all, “Survey: Consumers Want SMS Alerts.”  The study was conducted in the U.K., but you can expect similar attitudes prevail in the U.S.

While these numbers are impressive, I would argue that marketers need to keep their eyes on the top line/revenue growth “yin” to the cost savings/efficiencies “yang” offered by text messaging.  That’s the theme behind the diagram included in line with this post.

As marketers in any segment – healthcare or otherwise – approach the mobile channel, they have a variety of options for getting started, as we have previously discussed around mapping strategy to the mobile channel.

Many organizations will approach text messaging from a non-marketing perspective, which can yield impressive cost savings and efficiencies among an entire customer base – which tends to be dominated by customers served at a loss or break-even.  Thus the utility of text messaging as a cost saver.

Those companies that leverage mobile marketing techniques in a parallel fashion to target the revenue side of business should experience even greater results by increasing the pool of highest value customers – the 20 or so percent which generate the greatest value, be it profits or revenue.  The key to unlocking that added value is employing mobile engagement techniques such as promotions and others that call consumers to action.

The title of this article today on DMNews.com titled, “Marketers still missing opportunities with loyalty programs: Survey” immediately brought to mind this recent post of ours, as well as the answer to the missing component: mobile engagement.

The article doesn’t call this out per se, but does strongly imply that engaging in-store strategies such as SMS text message promotions are an absolute necessity to address the potential threat to retailers offered by comparison enabled mobile shoppers:

“…when it comes to consumers, nearly 65% acquired information about the programs in retail environments at the point of sale, compared to only 2.8% who did so on social media networks.”

The article is based on results of a study released today by the Chief Marketing Officer Council and conducted by IBM and Ricoh.  Its key finding is that although marketers are focusing spend on social networks to communicate loyalty programs, consumers are unreceptive to this channel as opposed to strong calls to action in and around the point of sale.

A similar focus on email marketing is also cited as a disconnect between marketer priories and consumer preferences.  Speaking of preferences, relevancy is found to be at the core of effective loyalty programs regardless of how an offer is delivered.  Certainly, data is crucial to developing targeted offers, the kind of which can be efficiently collected also via text message programs such as customer surveys.

Marketers need to as well be aware that even relevant offers may struggle against the tide of comparison shopping enabled consumers expected to change the retail landscape this year and beyond.  Successful retailers will build relevancy into their loyalty programs, but also recognize that engagement strategies such as SMS text message promotions advertised in store can prevent customers from leaving for better deals, addressing key challenges threatening to make loyalty a mythical concept.