“…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 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.

The survey finds product recommendations accessible via mobile devices as a huge opportunity for retailers, with 65 percent of those surveyed saying they would make purchases were it easier to find products of interest.  Retailers heeding this advice will implement mobile-accessible product reviews and recommendations based on factors such as real time inputs by a consumer (looking for a plasma screen TV, what are my options?) and historical transaction data if available (purchased TV in the past, suggest a DVD player).

A potential battleground retailers need to keep eyes on is the mobile product reviews/recommendations/comparison space.  On one hand, retailers can develop branded mobile experiences for their customers that are essentially “closed” environments by virtue of product selection limited to that one retailer.  Combined with clever engagement strategies such as mobile promotions, this can effectively combat third parties that aggregate product information, prices and reviews across retailers.

These services could render retail store environments as mere “pick up” spots for products browsed, reviewed, and compared by mobile shoppers.  The retail sector may be in store for a complete shift in power unless mobile engagement strategies rise to the top of marketing plans and priorities.

Both attendees and exhibitors alike were apparently personally armed with the devices and reportedly had either iPhone apps already in the market or were preparing them.  Large technology vendors in attendance also had iPhone apps to talk about, from Oracle and Sterling Commerce to Intel.  Funny that Apple itself was absent.

The observations reported in the article highlight just how powerful a marketing platform the iPhone has become yet retailers should not forget about text messaging as an effective mobile marketing method that can reach almost any mobile phone user.  Although applications are popular, engagement via text messaging is being used by retailers to overcome challenges around loyalty and comparison shopping behavior.

The best strategy is a balanced one considering the impact but lower reach of a rich smartphone application as opposed to the almost universal reach offered by SMS text messaging, especially those facilitating promotions such as sweepstakes and contests.  Targeting the mobile customer experience first, then determining the blend of approaches to achieve your goals is becoming the standard of excellence for successful mobile marketers.

Although it doesn’t say so, this post yesterday on eMarketer.com suggests that providing incentives designed to keep your mobile savvy customers in store is closely tied to ensuring they don’t bail and visit another store for a better deal:

“The threat comes from in-store shoppers using their phones to check sales prices at other retailers.  Compete found that 41% of iPhone users and 43% of Android users do just that.”

“You could argue that every retailer on the planet is an off-balance-sheet showroom for Amazon.  So if you go into a retailer’s store and you see something you like—type in that manufacturer’s SKU number and check the price on Amazon. You’ve looked at it, you’ve touched it, felt it, and now you’re getting the benefit of potentially getting the best price on it too.”

To meet this challenge, the post recommends “A retailer’s best defense for maintaining customer loyalty is to develop a mobile offering that allows in-store shoppers access to customer reviews and other product information on its Website.   This is where the opportunity lies for retailers.  By providing mobile access to their extensive online product information, they help customers feel more comfortable about making a purchase.”

This is a logical recommendation, yet it will not prevent price sensitive, mobile enabled customers from comparison shopping and potentially leaving the store.  It also ignores reseach suggesting that loyalty not be the target, but rather engagement.

To keep customers in-store and increase the probability of purchase, retailers should build engagement strategies into their mobile plans such as text message promotions like sweepstakes and other contests.

Consumers value their time as much as their money, which is why many are excited at the prospect of instantly performing a price comparison quickly then moving onto another store.  Retailers who create engaging mobile programs that keep customers in-store such as promotions lessen the likelihood that they will take the time to visit another store.

The article concludes with this statement, making it sound as if retailers attempting to create engaging shopping experiences raise their hands in surrender:

“Consumers will care less about where they shop and more about satisfying their purchase requirements.”

I bet you could find similar statements made about 10 years ago around how e-commerce websites would put brick and mortar stores out of business.  Yet that didn’t really happen, as brick and mortar stores such as BestBuy and others created complementary online stores.  Late to game retailers like Toys R Us paid a heavy price, however.  Why would it be any different if consumers can research and compare products while “on the go?”

One way the article suggests is that retailers will be forced to match lower prices if consumers can prove it by showing their mobile device to a cashier, or worse lose the sale as the customer leaves for another store.  Loyalty, already so hard to engender among customers, is literally out the door as a means of creating a steady flow of business.

In reality, I don’t think the situation will be this dire, but retail marketers have a new mandate to create engaging shopper environments to encourage customers to remain in store and make purchases.  Especially for considered purchases versus impulse buys, consumers will likely perform online research in advance of venturing out to stores.  Items such as plasma screen TVs or washing machines, for example.  In these instances it’s highly improbable a consumer will even perform a comparison price lookup in store because they did so already.

There will be exceptions, but I just don’t see retailers hurt too much by this trend, especially if they work hard toward creating highly engaging – and branded – mobile experiences for their customers.  Those who do will be more akin to the BestBuys of the mobile realm as opposed to the Toys R Us’.

Instead, marketers need to consider ways of driving consumption of their products across all kinds of customers, be they classified loyal or not, in the most efficient manner available. SMS text message sweepstakes contests promoted at and around the point of sale, and offering many rewards versus one, are a proven tactic that could be packaged and presented to customers as a loyalty program.

Such promotions can be executed quickly and largely in “hands off” mode for the marketer when using a mobile campaign management system like that offered by Interactive Mediums. That benefit came to mind as I came across additional research into customer loyalty that underscores the importance of an effective engagement strategy, more so than one designed to create “loyal” customers, who many in fact be a mythical concept. Consider the following from an article titled, “The 30 major factors behind a successful customer loyalty programme,” from TheWiseMarketer.com (registration required):

Focus on data value, not just repeat business: “The smarter operators used loyalty programmes not to buy repeat visits but to garner information from their customers in order to learn more about them: who their most profitable and least profitable customers were, what they wanted, and what changes or offerings would be most likely to make them truly loyal.”

Spend more time on engagement strategy, less on selling to customers you don’t want: “In Philip Kotler’s version of a Pareto Principle chart, the top 20% of customers generate 80% of the profits, while the bottom 30% of customers eat up 50% of the profits that the others produce.”

Paradoxically, attempting to sell to past customers is a distracting exercise: “Customer win-back expert Michael Lowenstein (of Harris Interactive) says that the success rate in approaching ‘lost’ customers can be three to four times as high as it is when prospecting for new customers. For example, the rate for converting prospects might typically be 5%, while that for reactivating inactive customers might be as high as 15% – 20%.”

These are just three of 30 different points, but were especially notable given the fit with mobile marketing tactics such as sweepstakes promotions. Interactive Mediums’ Customer Engagement Platform has powered effective promotions for many marketers who didn’t likely approach the project with the facts in hand regarding loyalty.

Marketers yet to embrace mobile marketing tactics such as sweepstakes as part of a broader engagement strategy need to get started now; because if you don’t your competition will, making it that much harder to break through the engagement barrier.

In 2006, Budweiser partnered with Interactive Mediums to power a similar SMS text message sweepstakes at the point of sale.  As both established and smaller brands alike take their initial steps into mobile marketing, sweepstakes are a proven approach to engaging customers in the mobile channel to drive sales, improve loyalty or build a brand.  As 2010 is about to open, marketers and promotional services providers in any discipline – branding, demand creation, or loyalty – owe it to their companies and clients to investigate this powerful promotional tactic as part of their plans.

Budweiser’s news is especially timely given recent posts about why mobile sweepstakes and contests are an absolute necessity for brand engagement and best practices for executing winning promotions.

• Half of your loyal buyers this year will not be loyal to you next year (Catalina Marketing’s analysis of tens of millions of shoppers).
• The 20% of buyers who account for 80% of sales includes super-heavy category users who might even prefer another brand and purchase that brand more.
• On average, 30% of loyal buyers do not have attitudes about your brand that support their loyalty and are the ones who are most likely to defect.
• For most brands, only a single-digit fraction of your customers connect to you via social media.

So despite so much emphasis on developing loyalty programs and the hype surrounding social media’s influence on consumer behavior, the facts suggest brand marketers are struggling against a tide they cannot overcome.  The article also raises interesting statistical research showing that successful brands connect not only with frequent, loyal customers, but all potential consumers:

“…you must find more people to become loyal, but you also must increase your share of purchases among those who buy your brand less than half the time.”

To achieve this, the author suggest marketers focus on “activating” their brands with consumers, which entails “imaginative shopper marketing, visibility, packaging (which is your ‘ad’ that every buyer sees), the right configuration of features, the right price, findability as people search and pre-shop digitally, and buying ads in special-interest magazines… just to mention a few ideas.”

I suggest that marketers identifying with these challenges look to mobile marketing tactics such as interactive text message promotions and sweepstakes that can pull consumers into perpetual dialogs with brands.  Promoting such programs at and around the point of sale is one approach brand marketers can use to influence less loyal consumers to consume their products.

The statistics and statements like the following suggest it’s imperative for marketers to look for ways of engaging as many consumers as possible with their brands.

“The marketing approach that calls for building brand engagement isn’t wrong, but it’s incomplete.  It doesn’t help you figure out how to grow the half of your sales that comes from less-loyal buyers who find multiple competing brands are acceptable.”

Given the reach offered by text message-enabled consumers and proven response rates in the 20-30 percent range, mobile promotions are a logical solution to this challenge.  Engagement platforms such as that offered by Interactive Mediums provide marketers a multitude of approaches to suit any promotional requirement.

We have previously written about this capability here in a recent Point of View and here in a Success Story, but I came across a great article on PromoMagazine.com that outlines some best practices which marketers should heed as they look to engage their customers in revenue producing and brand enhancing ways in 2010.

Titled, “Offer Multiple Prizes Instead of Just One,” the article describes the use of many individual prizes as incentives in a contest promotion, versus one large one.  The advantages include:

• Higher probably of engagement since consumers perceive a greater chance of winning.
• The opportunity to create a positive brand experience with more than a single winner.
• Consumers simply are drawn to the opportunity to win something of value and given the current state of the economy, more consumers are looking for such chances.
• A focus on many individual prices allows marketers to brand those awards with logos and messages.  That is harder to do with a car or other large hard goods prize.

Executing promotions in this manner ensures greater participation and a higher return, or as stated in the article:

“The hundreds of thousands of contacts…garnered can now be used for future, cost-effective, one-to-one, brand-to-consumer dialogue — which is typically the end-goal of any sweepstakes.”

Marketers or the companies who develop promotions for them should align themselves with technology solutions that allow such multi-dimensional contests to be designed, deployed and measured quickly and cost effectively.

A partner such as Interactive Mediums stands ready with an easy to use offering that will not box you into a single type of contest or one isolated to a single channel.