The year 2009 may be remembered as when the smartphone entered our everyday vernacular, but it also was when more marketers finally began to see the opportunities available through a device that is carried daily by virtually every consumer in their target audiences. The dramatic visibility and uptake of apps has made so much noise that it could hardly be ignored.
This is just the beginning. As the adoption of smarter phones continues and the next wave of development deploys, brand managers will be amazed at the sheer service and advertising possibilities. However, many of these seemingly futuristic advances will be based on the features already inherent in today's mobile handsets. With understanding of capabilities, some imagination, and constant focus on business goals, brands do not have to wait, and can build these advanced mobile programs into their 2010 plans.
Below are three fundamental areas for marketers to focus on, based on current technologies, with views and applications as to how each can serve the savvy marketer today and tomorrow.
Current reality: The transaction engine
The term mCommerce (or mobile commerce) has been used often, but it does not really capture the possibilities of what can be created through mobile devices. These pocket-sized computers, which just happen to make phone calls, really are powerful transactional engines. With that in mind, apps and other mobile functionality move all kinds of transactions into an un-tethered environment -- beyond traditional online -- and create the opportunity for new kinds of commerce and activity altogether.
As brands continue to evaluate which mobile opportunities to undertake, it is important to see precisely how this channel can either enhance an existing business or create an entirely new mechanism for interacting with consumers.
Retail is an obvious fit for the "enhancement" category simply by extending into the mobile environment. While some brands have left any transaction potential out of their current apps, the online juggernaut of Amazon embraced it smartly, and created additional value for its customers.
First, Amazon addressed simple mobile purchases, as consumers can log in to their existing user accounts, just as they would from any PC. This gets past the security-blanket hurdle. Next, using the core functionality on many smartphones -- specifically the camera -- the Amazon app brings the online brand into the real world. Users can snap a picture of any desired product with the app, which relays the information directly to Amazon. The photo is then matched to similar products sold on the site, either via automation or a group of people, and the consumer is notified in-app, via email, on Amazon.com's PC personalized homepage, and in the user's wishlist. Essentially, the world becomes the Amazon Shopping Mall. More importantly, this creates potential transactions virtually anywhere, including at competitors' brick-and-mortar locations.
Pizza Hut has moved in an opposite direction, mapping mobile phone purchase transactions to physical retail restaurants. For a consumer, the primary method of ordering food was traditionally to find and call a local Pizza Hut. But the company's new mobile service essentially brought the menu to life, helping a user customize a pizza order and then place it automatically at a local restaurant (using location-based services). Purchases can be made directly from the phone, and the mobile aspect keeps this access available to the consumer on-demand. While the app itself has had both positive and negative response, its business model illustrates how to open new avenues to the consumer when other online efforts have not been as successful.
The opportunities it brings
When adapted by other types of localized businesses, this could lead to true, efficient, on-demand purchases and delivery. Think of it as a retail store with no cash register. The mobile phone provides a touchpoint and interactive interface to the consumer, as well as connectivity to the transaction engine for purchases. So consumers can walk through a store, pick out items on their own handset, press buy, and grab their purchases as they exit. Or how about truly fast food, where each customer can order for him or herself at McDonald's without uttering a word. No need for lines, as there would just be purchase and distribution. These are service and business possibilities that the PC environment could never truly offer.
One new arena that opened with online adoption -- banking -- is about to change dramatically again, as mobile may provide an even more robust platform to service customers. Many of the large banks have deployed their own mobile apps, which currently offer the simplified basics of the PC environment. However, more functionality will find its way into these interactions, and can create new services altogether. USAA, a bank and insurance company, lets its customers cash checks directly from an iPhone app. The user takes a picture of the check, transmits it to the bank, and the funds are applied to the consumer's account.
Now, take this approach even further. What if a bank customer never stepped foot in a physical branch? The account opening "paperwork" can be done through the touchscreen of a phone, including the signage card. Deposits can be made. Money can be transferred. Even cash can be dispensed from machines with customers carrying the smartest of smart ATM cards, the phone.
Current reality: Location
Physical location may be the single most relevant targeting attribute for any marketer. As location targeting for ad units becomes more prevalent, the current method of evaluating and buying digital advertising becomes quite antiquated. Audience is great; demographics are helpful guides; but the actual ability to place highly-appropriate marketing in front of a consumer inside a decision-making moment increases the value of interactive advertising immeasurably.
The possibility of so-called "location-based services" has had marketers salivating ever since the smallest iota of computing or digital media became mobile. For the past decade, virtually the same example (just with varying brands) has been used by technologists and marketers alike to describe a mobile, location-targeted campaign. It sounds something like this: "You are walking by The Gap, and your phone begins to shake with an offer of 10 percent off a pair of jeans. You walk in the store, present your phone, and buy your jeans -- along with four other items."
From the introduction of the Palm VII with its pop up antennae to the embracing of the iPhone, challenges to this approach existed on technological and consumer-usage levels. However, within the past three years, both of these have been at least partially solved, making hyperlocal-targeting a reality.
From a consumer usage standpoint, Disney took an early stab at this, with a child-locator service in its now departed eponymous mobile service. But it was the introduction and adoption of mobile apps that created the basis for consumers to proactively use location to their own benefit. Obvious services such as mapping, driving directions, and mobile search use location as a focal criterion. An added category that found significant value with location is social media.
Several platforms including Loopt, Google Lattitude, and foursquare use location as a primary component for users to interact with their network of friends and contacts. Instead of just manual status updates, as on Facebook, automated location updates accompany posts, including displaying friends' current positions on maps. With this interaction as a basis, these services also offer suggestions of events, stores, and restaurants in the area.
The opportunities it brings
A brand advertising in such an environment can significantly heighten its own relevance. In fact, for retailers with physical storefronts ranging from clothing chains to restaurants, this is the specific type of consumer engagement that they have long sought. For example, a consumer having coffee at Starbucks opens a social media app to find friends in the area. He is presented with an exclusive mobile offer in a visual ad unit for the Best Buy within a block from his location. Alternatively, if the consumer is within the proximity of a Radio Shack, he could be served another unique offer pushing him to Best Buy. This location-aware advertising gives brands great consumer influence, hyperlocal targeting capabilities, and reduction in wasted digital media.
Campaigns like this exist today across the different platforms that have location at the core of their service. However, each platform has wrestled with moving that concept into a larger ad buying conversation. This transition is hindered partially by a matter of understanding by the marketer of the mere possibilities and the creativity to use this type of advertising effectively. Equally though, the challenge lies in the age-old scalability issue. That is, many agency buyers want to make large buys. While understandable, the real focus should be to directly address a brand's goals by adapting to the opportunities created by technology.
The seminal moment for advertisers will be when virtually every ad unit can be location-aware. This moves the potential from confined communities to virtually anyone accessing the internet or using an app on a mobile phone. This will enable a marketer to augment the normal buying decision criteria with the assumption of using physical consumer positioning. "Right place, right time" is an old adage, but here is that precise potential for the astute advertiser.
Current reality: Audio interactivity
Mobile devices are still primarily for making phone calls. While this is an often-forgotten aspect for mobile marketing possibilities, the technological necessity to support this functionality places a microphone in each consumer's pocket. This provides a basic component for untapped advanced advertising and interactivity.
Services like Shazaam have amazed and impressed consumers with its app that "listens" to songs and does a look-up based on that 10-second audio clip. It then returns a list of possible places to purchase the song directly through the mobile phone.
The essence of this concept can translate specifically for brands as well. To simplify the overall functionality, Shazaam uses an audio element to trigger a response. What if a clever marketer were to build similar pieces into a mobile campaign, letting users' phones listen to its advertisements, thereby augmenting larger media investments?
For example, Wal-Mart could create Mobile Sunday on NFL telecasts the week before Thanksgiving 2010. On its national TV spots, it featured an exclusive mobile sale for Samsung's Blu-ray player. While the commercial may have looked like any other, the audio -- whether audible or not -- automatically triggers the customer's phone to open to the product details and purchase opportunity for the Blu-ray player. Now that is how to use advertising to directly drive purchase.
Further, consumer behavior proves that people watch TV with their phones by their sides (see "American Idol"). It is an ideal interactive medium, which some brands have tried to embrace with text message calls-to-action. This mechanism is significantly more advanced, and even simpler for the consumer.
The opportunities it brings
Beyond the single app component, the next logical step would be mobile ad units that are themselves "audibly aware." This infers the relevance of the moment based on the sounds surrounding the consumer. While a consumer is multi-tasking, watching a TV show while viewing the web on the phone, mobile advertisements could directly correlate to the show itself. This would let a brand reinforce its on-air buy, potentially compensating for the exposure lost to DVRs. It is yet another evolution in the targeting capabilities made possible by the growing contingent of iPhone, Blackberry, and Google Android users.
The awareness and transactional capabilities that mobile phones can provide will continue to grow rapidly, and can serve brands well. There will inevitably be some privacy concerns, but the right approaches and innovations will help protect consumers. As the online world and that around us blurs more, the opportunity for a marketer to adapt may be the biggest challenge. This is not a matter of chasing the shiniest, newest thing. It is understanding consumer behaviors, and how mobile technology specifically enables brands to actively be a relevant component of each customer's day.
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