Mobile Coupons and Vouchers: Let’s Keep it Simple

Press release – November 15, 2013

By Siamac Rezaiezadeh, Strategic Account Executive, OpenMarket

The major change to affect mobile as a marketing and customer engagement channel has been the growth of the smartphone and app usage over the last five years. According to analyst firm Juniper Research, consumers will download 80 billion mobile apps globally during 2013. Juniper predicts this annual figure will rise 170 billion in 2017, driven by consumers in emerging markets upgrading from feature phones to smartphones.

Many brands and retailers have already launched their own mobile app for customers to use, letting them instantly locate stores, look up prices, check stock availability, and place orders. Smart retailers are now using these apps to send vouchers and offers to customers via on-screen push notifications, driving even more engagement and commerce.

Branded apps
Somebody choosing to download an app shows that they’re already interested in a retailer’s brand or products. The retailer can then combine the customer’s app registration data with details of their previous purchases, recorded either on a store card used in-store or in an online shopping order, to deliver relevant and timely offers and coupons to their device via the app.

But retailers should also remember that not all of their customers will have smartphones or will want to download a branded mobile app. It’s important therefore to follow a mobile coupon strategy that engages every type of mobile phone user – not just smartphone owners, but feature phone and low-end device users as well.

Universal appeal
For a coupon solution that’s capable of reaching the broadest range of consumers, a brand or retailer need look no further than that staple of the mobile industry, the text message. SMS is a tried and tested, universal system that is interoperable across every type of mobile device, smartphone and entry-level handset.

An SMS coupon can be as simple as an alpha-numeric code that a brand or retailer sends out to its customers, it can also be used to send a URL link to a website that leads to the coupon. A retailer can send a coupon as content within an MMS message as well: each type of coupon can be redeemed simply by showing the message to the sales assistant at the checkout.

Integrating with Point of Sale
Another key consideration for retailers and especially brands is whether to create mobile coupons that can be read and redeemed by in-store electronic Point of Sale (EPOS) terminals. Retail chains that want to offer customers barcode-based mobile coupons will need to upgrade their existing EPOS systems to recognise the vouchers. This is an expensive process – especially for bigger retail chains with large numbers of EPOS machines to update.

For popular consumer brands that are sold in multiple stores and other places, the dilemma is even more acute: FMCG brands need to produce mobile coupons that are compatible with a variety of different EPOS systems for every retailer or outlet that stocks its products. Each individual retailer will have its own EPOS system that it will need to adjust in order to accept the brand’s coupon.

This challenge isn’t insurmountable. Kellogg’s earlier this year revealed that it is in talks with European supermarket chains to update their EPOS systems so that shoppers are able redeem mobile-based coupons for Kellogg’s products in-store. But this process will take time. In the meantime, expect brands to enter into partnerships with specific retail chains for mobile coupons, as the first step to building relationships with consumers via their mobile phone.

A positive end-user experience
Retailers and brands must remember that ultimately i’’s not the technology that’s important – it’s the end-to-end experience for the customer. An effective and well thought-out mobile coupon campaign will engage the customer with timely, personalised offers and messages that are relevant and useful to them, address their needs and which enhance their relationship with the retailer as a result.

To achieve this, retailers should adopt a long-term view on mobile coupons and regard them as the means for ongoing engagement with consumers. Rather than use it for isolated, one-off launches or promotions, retailers should instead regard it as a tool for continual engagement.

Ongoing improvement
For retailers, the message is that your earliest campaigns won’t necessarily move the revenue needle significantly but what they will do is provide useful data which you can use to improve and drive your next campaign. This in turn will deliver better results and more data for the campaign after that… and so on.

The more the retailer engages with individual consumers via their mobile, the more data it can collect and the more it can learn about them – their tastes and preferences, when they shop and where they shop. By collecting and analysing these data thoroughly, the retailer can improve the accuracy and targeting of its campaigns in ways that add value, sustain customer loyalty, and contribute to a satisfying end-user experience. In an increasingly competitive retail marketplace, these extra benefits can make the difference in opening up new sales opportunities and driving revenue.