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.

Similar to what we described in our Point of View on Active Customer Engagement and this actual customer example, email, web and mobile communications work together as part of a larger effort consisting of media buys supporting a promotion.  It isn’t apparent that the retailer had access to a system encapsulating all the components required to configure, execute and measure the program, but you can be certain if it did, ROI would have been greater.

A tidal wave of buzz is building around Active Customer Engagement, as illustrated by another recent article outlining the solution here on the Illinois Technology Association website.  Today as well, we were featured in a brief article titled, “Time to market with mobile” at brand-e.biz in which we say the following that gets to the heart of what Active Customer Engagement’s value is all about:

“What should drive mobile marketing investments is a strategy which focuses on the customer experience, what you want to achieve with your customers.  Developing ideal mobile paths for your customers to follow to achieve your goals should yield the best results…And in practice this will almost always mean some combination of text message interactions, mobile applications, mobile optimized web and even e-mail.”

More interesting than the recommendations were references to an earlier November 24, 2009 article on MarketingVox.com citing Direct Marketing Association (DMA) ROI research for email and search marketing:

“…commercial email now returns $43.62 for every dollar spent on it in 2009…”

“…search advertising..is the next most effective channel with an ROI of $21.85 for every dollar spent.”

A simple conclusion would be that email’s return is about 100 percent that of search.  Consider as well that, with respect to email, “41% of consumers find that promotional offers are irrelevant, according to a study by the Chief Marketing Officer (CMO).”  That means despite nearly half of those subject to email marketing rejecting those offers, ROI is greater than 4,000 percent!  It isn’t clear if ROI was calculated based on direct sales driven by email promotions.

Even so, you could argue that relevance is a key determinant of return for email and search marketing investments.  Paid search may help connect consumers with relevant results, yet search by its nature is rather broad, pointing consumers to some destination rather than calling them to action.  An email communication pushed to a consumer by a business should be more targeted, relevant and contain a compelling call to action.

Considering mobile — especially SMS text message interactions – by its nature must be relevant, ROI should exceed both email and search.  Extrapolating figures cited in the article, ROI for mobile marketing could be another 100 percent greater than email, offering upwards of $80 for every dollar spent.  Even if it’s no better than email, mobile’s ROI is highly relevant to marketer’s interested in making the most of their budgets.

I call out email specifically because of a few different things I’ve read over the past week which suggest certain marketing tactics make it too easy to be ineffective – or less relevant to consumer needs.

Although mobile email use is growing, email as an interactive channel by itself has hurdles to overcome in my view which hurts its ability to serve a marketer’s objectives.  Today, for example, on eMarketer.com an article titled, “Relevance Remains a Challenge for E-Mail Marketers” cites statistics which suggest email for many consumers is very much like traditional snail mail – for the bills:

“Promotional e-mails were the most common thing for respondents to find in their inbox, with 60% saying they received such e-mails most. E-newsletters were the next-most-common type of messages.

But it was the least common messages that were most likely to be opened—monthly bills and bank statements. Only about four in 10 recipients said they “always” opened promotional offers or newsletters.”

It’s the consequence of this mismatch between consumer preference and marketer practice that marketers need to be wary of:

“Web users also complained of receiving too many to manage and getting tired of all the clutter.  In many cases that clutter can have consequences for marketers: 22% of respondents have decided not to purchase from a company because of irrelevant promotions, either via e-mail or direct mail.  A further 41% said they would consider doing the same.”

Another article, a November 20, 2009 item titled, “Yesmail talks strategy behind mobile email, SMS features” quotes the email marketing firm’s leaders regarding their move to offer mobile marketing services to its clients:

“Yesmail is already starting to early stages of mobile marketing evolving from an acquisition channel to a retention channel.  We expect to see SMS campaigns being created with the same level of sophistication as many email marketing campaigns – both in terms of segmentation and in terms of staged triggering over the next two years.”

In fact, some mobile marketing providers are already offering the ability to create triggered campaigns based on customer segments – no need to wait two years.  It’s illustrative of an undercurrent of FUD (fear/uncertainty/doubt) from email marketing services companies scrambling to extend their offerings into mobile in order to hang on to their customers, many of whom increasingly view email as a commodity.  Wise marketers should recognize the difference and not get fixated on mobile as an add on to an email campaign.

When it comes time to creating a relevant message flow, offer or call to action, it’s logical to segment your customers into groupings which lend themselves to the task.  This was the topic of a great October 22 article on ChiefMarketer.com titled, “Lock and Load: The Basics of Triggered E-mail Campaigns.”  The article is all about email as a means of crafting an interactive dialogue with customers to achieve business goals – a task that email may be ill suited to given the recent statistics cited in this post.  It concludes with a quote that marketers should take to heart, but with a view toward mobile as the means – not email:

“The beauty of event-based triggered messaging is that you can make it extremely relevant to the person receiving the e-mail.”

Problem is, email may not be the right approach to delivering those messages.

It need not though, and today I came across a good article on DMNews.com with some sage advice for marketers sitting on the fence with mobile.

Titled “Why SMS messaging is more than a teen tool for marketers,” the author makes some good, common sense recommendations about how to obtain opt in permission and thus begin marketing to customers through the mobile channel:

“…when a customer visits your Website and signs up to receive updates on sales, new products or services, offer the customer the option to receive updates via SMS in addition to, or instead of, email alerts.”

“For those businesses or product lines with standard customer agreements in place, the consent to receive important updates and offers via SMS and other communication channels can be added directly to the customer agreement, securing an opt-in immediately upon the origination of the business relationship.”

I thought the latter point was notable, as I have not seen such a recommendation before yet it makes complete sense, for both B2B and B2C customer relationships where some agreement accompanies the transaction.

The takeaway here is that opt in doesn’t need to be the centerpiece of a complex or costly marketing program with various calls to action.  In fact, gaining permission using existing forms of customer communication means the opt in step may be right under your nose.

The post cites recent comments by MobileStorm’s CEO, who laments the fact email marketers often gate mobile from gaining more traction than it otherwise should.  He’s found prejudice developing against mobile as a viable marketing channel, let alone a complement to email.  Email marketers don’t understand how mobile differs from email and fear customer backlash in the event a mobile interaction is not executed properly.

I would argue that this situation is largely due to the way mobile marketing service companies have packaged and positioned their offerings. To date, mobile marketing services — especially those based on SMS — have looked a lot like email in terms of fee structure and focus on message delivery.

There is certainly a large business opportunity with this approach, yet logically, packaging and selling mobile around large business problems would align more closely with the concerns and needs of marketing leaders (which does not exclude email marketers, but it might clarify mobile’s value and role relative to email).

As I’ve noted here, email marketing service companies have begun extending their services into the mobile realm, attempting to prevent scarce marketing dollars from flowing away from email. Their efforts compound the above issue by pushing mobile as an adjunct to email.

I am reminded of this October 30, 2009 article on eMarketer.com, where an interactive agency exec explains a key challenge facing marketers interested in mobile:

“just figuring out who owns mobile (is a challenge).  Mobile itself can be used for just a lot of different goals.  For instance, it often works really well as a drive-to-store program.  The problem is that those handling drive-to-store programs aren’t necessarily those handling online marketing, which is focused on getting people to your Website.  So if you’re not trying to get people to your Website or to a store, then it can often just wind up in limbo.  I think those kinds of organizational challenges are just one of the hurdles that mobile overall has been facing.”

We are probably a long way from seeing a title like “Chief Mobile Officer” who takes ownership of the mobile channel customer relationship.  Until that point, marketing leaders need to take mobile seriously and not relegate it to another message channel for consideration (or not) by email marketers.  I imagine the smarter email marketers fully comprehend the distinction between email and mobile.  Those who fail to see the difference should consider the rapidly growing list of examples where email and mobile work in tandem to deliver a revenue and profit producing mobile customer experience.

Many of the paper’s conclusions are consistent with views we have blogged about, but I was curious if and how YesMail offers mobile capabilities, if at all.  Searching, I came across this October 19, 2009 announcement that I think was missed by the mobile marketing press.  In it, YesMail announces additional capabilities to its Enterprise edition service encompassing both mobile email and SMS messaging.

For SMS, they have partnered with VeriSign as an aggregator to offer single point messaging access across many network carriers – not unlike other SMS text messaging marketing providers.  Not clear was how actual campaigns are created, deployed, and measured, and even their website provides sparse details.  It’s as if there’s a gap between prescriptions in their white paper and their new mobile capabilities.

It appears that like other email providers, text messaging is being viewed as a complement or alternative message delivery medium to email, designed to ensure email marketers don’t look elsewhere when the topic of mobile comes up within their organizations.  Wise marketers, be they aligned to email or not, would be well served by looking at the mobile customer experience to guide their initial forays into mobile.

“…consumers choose e-mail at a rate of three-to-one over any other channel for marketing communications.”

As a marketer, that sort of statement suggests I allocate more money to my email budget, but maybe not.  The article co-mingles a lot of related but different ideas which are not entirely comparable: customer channel preferences in the abstract, multi-channel marketing and permission-based marketing methods.  So I downloaded the full report and read it myself.

I can appreciate the marketing utility of a study conducted by a third party and whose results fully support my company’s vision and business plan.  The problem is when the presentation is fairly transparent and ultimately not particularly useful to helping a marketer make a decision.  Before a marketer takes action based on this report, I suggest they consider the following alternative viewpoints:

Consumers don’t fear SMS spam.  The paper states “…as the data in our research shows, subscribers are weary of SMS folders clogged with SPAM or other irrelevant messages (like their email inboxes).”  That may be a data point from the study but it doesn’t jibe with other independent research showing SMS-based communications are not gated by this perception due to the awareness of SMS as an opt-in only channel (unlike email).

Don’t forget about shortcodes.   The paper describes SMS as allowing messages “only sent to 10-digit phone numbers.”  That sounds like a lot of data entry to send a simple message, which may be why shortcodes allow a consumer to exchange messages using generic or vanity 5 digit numbers.  Consumer to consumer text messages may require a full 10 digit number, but marketers may read this as a limiting factor in their communications with customers which simply isn’t the case.

Getting started with SMS marketing isn’t that complicated.  The paper describes an SMS campaign as follows:  “Must coordinate delivery across multiple carriers (typically 2-3 months for a private short code).  Submit documentation and receive approval from each mobile carrier for SMS campaign, intended audience, and supported keywords.”  Yikes.  For this reason, firms like Interactive Mediums stand at the ready with solutions that have already considered these steps, thus allowing marketers to focus on their strategy, business objectives and customer outcomes.

Isn’t text messaging more widespread now than even voice?  The paper states, “Second only to talking, text message is becoming the most common cell phone activity.”  In fact, I think more recent studies say text has eclipsed voice.

Isn’t text messaging now widely used across many demographics?  The paper states, “Not surprisingly, results showed text messaging usage skews toward younger cell phone owners.”  Marketers should not interpret this as a limiting factor in the utility of SMS text message campaigns for targeting demographics across all segments, as many success stories describe almost daily.

Marketing campaigns are a more recent application of SMS text messaging than email, which is different than saying consumers prefer email.  The paper describes more mature marketing methods like email and direct mail as associated with consumer permission for the communications.  By comparison, a small percentage of responders made similar claims for text messaging.   Given the longer history in the marketplace for email, this statistic is not surprising at all, but should not be perceived as a measure of text message viability – if anything, it illustrates the real opportunity to cut through the clutter associated with SPAM email marketers.

Text messaging is not a means to an end.  The paper states “Only 9% of SMS users currently view text messaging as a preferable alternative to promotional email…Clearly, most consumers still prefer to receive promotional communications through email.”  This is a naive view of the reality on the ground today, with many successful applications of text message marketing including email and traditional display advertising components.

Fixation on permission, subscription and relationship management.  The paper paints the opt out process of text messaging as an unobvious one that marketers need to ensure their subscribers understand.  By its nature, text messaging is an opt-in approach, whereas it has been retrofitted to email due to SPAM.  Opt-out instructions are typically bundled in SMS interactions and should clearly explain the process.

Consumers only interact with brands/businesses they want to.  The paper boldly calls out “According our survey, 80% of SMS users believe marketers should reimburse them for the cost of commercial text messages.”  This is not a material point given that consumers are called to action to opt into such communications increasingly, reflecting the cost as a nominal consideration that over time becomes even less material as data plans account for text cost effectively.

I could go on, but these were the most important points to call out as painting text too narrowly as a message delivery vehicle like email, but less effective.  Large established businesses like ExactTarget recognize that text messaging and the mobile channel overall are gaining acceptance as highly effectively customer engagement methods which may steal budget or emphasis from email.  The reality isn’t quite as black and white.

Mobile is a channel inclusive of real time interactions enabled via SMS and also provides a platform for rich applications, mobile web, and even email.  If mobile belongs on any continuum, it should take a place alongside the web, call center, and point of sale.  For this reason, wise marketers are approaching mobile as a customer engagement opportunity that requires a unique point of view reflecting the more active nature of customers “on the go.”  At Interactive Mediums we prescribe an approach which helps marketers map their marketing and customer relationship strategies to mobile most effectively.

In past posts, I have characterized email as a communication tool best used “out of line” with a customer’s daily activities, and I think that still holds even if email can be delivered to a mobile device. Email is often more verbose and detailed than text messaging, and less interactive than text, mobile websites or applications. I would now add that in addition to thinking about email in the context of “out of line” versus “in line,” it should be viewed in terms of a marketer’s customer development objectives.

• Interactive Dialogue: text messaging, websites, applications
• Communication: email and phone

The former has greater relevance in real time as a customer shops, is driving somewhere, approaching a restaurant or browsing a car dealership. The latter are activities which require sudden and dedicated attention to speak and/or interpret information, which do not lend themselves well to calling customers to action. We have also said that the Mobile Customer Experience may soon be the most relevant interaction channel, underscored in the article with respect to email:

“The day when more people read and respond to email via their handhelds than any other platform is approaching, underscoring how critical it to build email campaigns that are optimized for mobile devices.”

“The bottom line is that all handhelds are growing in importance, and more and more consumers will be accessing marketers’ email on the small screen while they’re on the go, not just the big one while they’re sitting at their desks.”

I think the real bottom line is that email has its role in the Mobile Customer Experience alongside other communication and interactive approaches, but marketers must let objectives drive the choice and scope of technologies used to achieve them.

Email’s characterization in the article is similar to one we made here in describing it as a communication method used most typically “out of line” with a person’s behavior versus more active, “in line” methods like mobile or instant messaging:

“We all still use email, of course. But email was better suited to the way we used to use the Internet—logging off and on, checking our messages in bursts. Now, we are always connected, whether we are sitting at a desk or on a mobile phone. The always-on connection, in turn, has created a host of new ways to communicate that are much faster than email, and more fun…Why wait for a response to an email when you get a quicker answer over instant messaging?”

The article also notes that even as email use continues to grow, alternatives and new methods are emerging even faster:

“…while email continues to grow, other types of communication services are growing far faster. In August 2009, 276.9 million people used email across the U.S., several European countries, Australia and Brazil, according to Nielsen Co., up 21% from 229.2 million in August 2008. But the number of users on social-networking and other community sites jumped 31% to 301.5 million people.”

The sheer volume of communications now possible raises the specter of effectiveness.  The paradox which is mobile that we have talked about is also referenced; people can now communicate with almost anyone, anywhere, anytime, yet the most relevant and useful interactions are those which are personal.  The article describes the distinction as “…a river that continues to flow as you dip into it” versus “too much information.”

For mobile marketers, the takeaway should be that the opportunity presented by mobile cannot be ignored but the most effective interactions will be those that consider the Mobile Customer Experience first and foremost.

While I agree that “Epsilon’s move into the mobile space is further evidence of the channel’s growth and potential,” I take issue with language used in the article which for the less savvy among us makes it appear this is an integral solution offering a unique value proposition.  For example, claims are made such as:

“The combined Epsilon/Air2Web’s mobile messaging solution provides significant value to companies focused on the effective use of mobile messaging for customer lifecycle management.”

In fact, I imagine the “solution” is simplified, single point access to text messaging capabilities for Epsilon email marketing clients, if you read between the lines:

“Since we’re already supporting many leading global brands, this partnership allows us to seamlessly add mobile to our comprehensive services and create a fully integrated program for each individual client.”

That can have value for their clients interested in mobile marketing, but it fails to recognize mobile as an “experience” with unique requirements.  Mobile is not just another communication conduit like email – it can be, but it’s more valuable use is as an interaction channel inclusive of direct marketing applications.  Marketers seeking the best return on their investment and to leverage mobile most effectively for their organizations will take a holistic view and develop a strategy focusing on the mobile customer experience.  That exercise highlights limitations in looking at mobile as an “add on” to email.

The paper conveniently states: “the first type of mobile marketing is simply sending pre-existing email communications to mobile devices or “smart phones” (e.g. BlackBerry, Treo, Motorola Q devices).”

For a dedicated email marketer, that may at first seem like a good strategy, and Experian supports device specific formatted emails to ensure user presentation is consistent.  Yet, this is a narrow view of the mobile channel not indicative of how the email marketer’s boss should perceive mobile – as an interaction channel as opposed to a message conduit like email.  SMS is often the more logical initial foray into mobile marketing given its greater potential audience, but Experian recommends it as the “second type of mobile marketing.”

For marketers new to mobile, the paper explains common terms but when it comes to text messaging, Experian does not provide this service itself; it partners with a UK firm to offer text message marketing capabilities and appears to be simply passing through the business as a reseller.  No wonder text is “number 2.”

Given the lack of consideration for the mobile customer experience and other important elements like applications and mobile optimized websites, the Experian paper underwhelms with a focus on simply selling more email services targeting mobile devices.  The date of the paper, May 2007, shows it lacks currency which the rapid pace of change and innovation in the mobile space absolutely requires.

Marketers, be they mobile or email focused, should of course consider pre-existing vendor relationships to engage customers via the mobile channel, but they must be certain to do so with an eye on their business requirements above all else.

The article makes some good points about the differences between buy and build approaches, making it appear all but a foregone conclusion that a marketer new to mobile would use a third party expert to execute the program (probably the author’s intent).

One aspect I think the article overlooks, even for newbies, is the customer knowledge to be gained in executing mobile marketing programs. I think too much of mobile marketing today is focused on advertising and the ease by which ad messages can be delivered to mobile devices. Mobile should be viewed as another customer interaction channel, such as the point of sale, a call center or even more simply a website. It seems much more value is to be gained by such a view.

Too often I think marketers associate mobile with email as a message transit service, which is just one application of mobile marketing technologies; mobile can and often is a real time, bi-directional marketing channel, even when utilizing SMS, and therefore is fundamentally more interactive than email.

While there may be no explicit costs involved in planning for the types of information about your customers you can and wish to gather, it certainly should be a top of mind consideration at the onset of any mobile marketing program. I would add as well that in selecting a third party to work with, marketers should be sure that data generated is portable and owned by them, not the provider, and can be easily extracted for additional analysis.

As I blogged about yesterday, TextMe recently extended its already strong data capture feature set to facilitate marketers’ thinking this way. So even if drawn to mobile because of low cost and high response rate (as pointed out in the article), marketers in all industries should plan ahead and consider the new customer knowledge they can gather from the outset. Stay tuned for examples illustrating just how.

As the dollars invested in mobile by marketers escalates, I would expect them to cast a more careful eye on the return these investments offer.  What is interesting is that the firms subject to the Chief Marketer study cite metrics that appear identical to ones used to measure the effectiveness of email.  Consider the following grab from the report:

Email is measured along similar dimensions: response rate, opt ins, click throughs, etc., leading many marketers I expect to compare mobile to email for the purpose of allocating budget dollars.  I’d like to suggest that the two approaches are complementary, not competitive, and that they should be measured differently.

The best analogy I can think of is the relationship between email and instant messaging on a desktop computer.  While at work, I often have both applications open at the same time yet use them for entirely different, yet valuable purposes.  Email tends to be an activity that falls “out of line” with the flow of my work, whereas instant messaging is an enabler “in line” with my work.  For example, I may communicate a status via email that could be read by the recipient any time, but use instant messaging to ask a question in real time of a remote colleague that needs answering immediately.

I see this “out of line” as opposed to “in line” distinction as key in understanding email relative to mobile.  Although virtually everyone has a text enabled phone, the most successful programs rarely target all people, everywhere.  The beauty of mobile is the ability to create instant, relevant and often localized marketing programs.  By their nature, the potential audience subject to a mobile communication may be small, but collective individual actions can have tremendous value (as in driving consumers into a store to make a purchase).  Email conversely almost always targets a larger audience.

The fact that only consumers opting into mobile communications receive them reinforces this focused approach.  Email on the other hand has the reputation for being a spam medium.  Although this has calmed down in recent years, it remains a communication for contacting people “out of line.”

The third article I referred to earlier I saw today on eMarketer.com regarding email marketing response rates.

In light of my observations, it was interesting that eMarketer found that the smaller the list of email targets the greater the open rate (much as I would expect for a similarly targeted mobile communication).

“Messages delivered to small and medium lists had higher open and click-through rates than messages delivered to lists of 1,000 or more subscribers.”

and

“A smaller list does not directly affect open and click rates, but mailings to smaller lists may be targeted better, contain more relevant content or have more recent subscribers.”

Part two of this eMarketer.com article goes on to highlight results of a similar study from Epsilon, which found open rates for its survey subjects to be higher.

Perhaps more interesting than the raw figures was that Epsilon found email effectiveness varied by industry:

“General financial services e-mails were opened most frequently, followed by general business products and services, and credit cards and banks.”

and

“The least popular categories were apparel, publishing and media, consumer packaged goods and electronics.”

It goes without saying that many top firms using mobile marketing tactics fall into the “least popular” email response category above, due I expect to the fact these products and services lend themselves to communications in line with a consumer’s “out and about” activities.  Email, it appears, seems a better fit with consumers’ “out of line” mindset, such as balancing their checkbooks or undertaking other personal finance activities best done at home.

From all of this information, I would conclude  that mobile marketing has its role alongside email as an effective marketing medium.  Yet, the data suggest that when viewed separately, mobile may be a better choice for retailers, content providers such as publishers, CPG companies and electronics companies if open rate is the key metric.