Is Mobile Marketing Saving Christmas Sales?

Originally Published: December 2008

Traditionally Christmas has been a lucrative sales period. It allowed high profit margins because customers had to buy presents for their family and friends. In recent years this has all changed. Driven by discounting, Christmas is now a grab for short-term growth.

This year under unique economic circumstances no one is sure what to expect. There is ‘blind hope’ among some retailers that Christmas will give people a reason to pull out their wallets. Given last years growth (UK: +1.4%; US: +1.7%) this is unlikely.

Scattered throughout these ‘hopeful’ retailers are businesses that are taking action by investing in mobile marketing. They are using this platform to make it easier for people to shop their stores (online and offline). In return they expect a higher share of wallet and greater brand loyalty.

The perceptions of mobile marketing have changed overnight in the US. As retailers like Wal-Mart, Target (US), Sears and Amazon choose to leverage the platform and connect directly with customers during the Christmas period. Born from the realization that one of the hardest parts about Christmas is finding the right gift (at the right price), these retailers have created their own mobile tools to empower the customer. For example, Wal-Mart is currently using a text-messaging service where customers can receive information about store categories they are interested in. After signing-up customers receive weekly ‘Holiday Special’ alerts on the chosen category. These messages are linked to Wal-Marts mobile website which allows the customer to find additional information (as well as customer reviews). Another example is Amazon, who created an iPhone application that lets customers find the gift they want. Using their iPhone, customers can send a photograph of a product to Amazon and they will find if they have the item in stock and its price. All stock can be ordered through the mobile portal (unfortunately this is only available in the US).

Target Christmas Application

Early Adopters and New Technologies

Originally Published: November 2008

‘If you please everyone you end up pleasing no-one’, and this couldn’t be truer for new ‘early adopter’ technologies. In marketing there is an acknowledged curve of innovation acceptance, it starts with the ‘early adopter’ and proceeds to ‘mainstream’. A fundamental problem when new technologies launch is that they focus their advertising on the mainstream in hopes of meeting unrealistic early targets. However by doing this they bypass the people that have the potential to be the brands biggest advocates (early adopters). This ultimately raises the question of long-term or short-term product success.

Looking back on now seemingly mainstream technology brands: Skype, Apple, Facebook; they all launched by focusing their attention on the early adopter. For Skype this was someone who was technologically savvy however for Facebook this was college students looking to keep in ‘social’ contact. These early adopters pushed these brands to mainstream through advocacy. Although in theory it is easy for companies to start by targeting the mainstream (dictated by unrealistic predictions of product sales), this group often isn’t ready for the product. They rely heavily on others opinion and the ‘all clear’.

A great example of the importance of early adopters for new technology product success is Amazon’s digital book reader Kindle. Launched in November 2007 with little mainstream communication, it only sold 240,000 units in 9 months (most of whom were early adopters). Through feedback they found that Kindle owners ‘love their Kindle and like to show it off’, essentially they were brand/technology advocates. With this under their belt they are now trying to break into the mainstream by using early adopters as the ultimate sales people. They have done this through a communications campaign called ‘See A Kindle in Your City’, allowing a member of the public (without a Kindle) to find the nearest user and arrange for the ‘early adopter’/advocate to talk to the potential buyer about the product. This has all been facilitated through Amazon’s Kindle website forum. Reflecting upon Amazon’s actions shows that to get a new technology launched takes time and once you have your early adopters working as brand advocates the cost of acquisition is a lot less than advertising directly to the masses.

Where a new technology is involved (such new software or interactive feature) it is important to remember that the best way to educate an audience and generate sales is to start with the early adopters. Although this plan of action doesn’t always fall into a sales plan (due to its long-term focus), its pay off is far greater than appealing to everyone and convincing no one.

Curve of adoption

Microsoft?


Originally Published:  September 2008

This week’s Spot is about Microsoft and making sense of their recent, publicity generating teaser campaign with Jerry Seinfeld and Bill Gates. After years of being the ‘PC guy’ on Apple’s ads and their disappointing $500 million Vista communications launch (part of Microsoft’s largest revenue generator – Windows) Microsoft have decided its time to accept defeat. This move is rare in the information technology market and more so for a leader to admit to how the public actually perceive them. The question for this issue is: Will this work (and what can we learn from this)?

The game has changed since Apple launched its Mac vs. PC ads two years ago, when it was a David and Goliath story. With less than half of Microsoft’s nearly $1billion budget, Apple managed to rebrand Microsoft as ‘a kind of self-conscious and self-absorbed nerd that is out of touch with the normal lives and needs of its users’. With no retort from Microsoft, Apple has made this a Goliath vs. Goliath issue, where they are just as bad as one another, until now. Microsoft is about to make it worse for Apple (and hopefully turn the whole situation around) by embracing the image that was assigned to them through the characters of Bill Gates and Jerry Seinfeld (others to follow).

Microsoft’s accepting direction is not just prevalent in its communications but is it part of a broader strategy. For example, they are training and creating ‘Window’s Gurus’, similar to ‘Mac Genius’’, in Best Buy dealer outlets in the US; a move almost mocking Apple and putting them in an uncomfortable position. They have reinvented their Vista website making it more usable, created an area where users can upload photos they have taken whilst using their PC’s, and ads through which you can email Bill Gates directly to talk. This shake up is important to watch and learn from, as Microsoft show how a market leader can turn around their image by accepting how they are perceived (not challenging it).

What can be learnt from this?

Basically, you don’t always have to challenge perceptions to win over the market. If a company starts by accepting what their consumers think about them (good or bad) and work to empathize and accept this they will automatically be in a more credible position.

Mobilising Through Social Media

Originally Published: October 2008

There has been a huge amount written about Barack Obama, some of this has come from marketing journals and magazines. These aren’t political commentary or details on media spend, but rather articles written about Obama’s marketing strategy. Obama has made himself a brand and embraced a political candidate’s worst nightmare – social media. However, this is not about ‘Brand Obama’ (there are plenty of articles about this) instead it questions the underlying premise of Obama’s strategy: Can social media mobilise?

It doesn’t make sense to run a political campaign with a huge online component unless there is a guarantee that these virtual participants will enroll and vote (hopefully for said candidate). As it stands this form of logic holds true as there is not a motivating or self-serving factor making people vote (as nice as it would be to think that politics interests all). For example, ‘Obamagirl’, who caused quite a stir on YouTube with her ‘crush’ video, failed to vote in February’s primary in her home state of New Jersey; showing that virtual participation is not always equal to real life action. This problem is something that political candidate Obama has been quick to catch on to and so too should companies that use social media in a similar way, with hopes of a similar outcome.

A motivating factor in social networks such as MySpace, Facebook or for this example Mybarackobama.com is peer pressure and subsequent social embarrassment. With this in mind, Obama (more likely his marketing people) has set about creating greater transparency on his home social network. As part of a profile on Mybarackobama.com supporters are given an ‘activity index’ which measures their recent active involvement in Barack’s campaign. The index is ranked numerically from 1 to 10 (1 lowest and 10 highest) and is visible to friends and other members. Supporters can increase their activity index by: registering to vote, calling voter lists, hosting events, raising funds etc. The ‘activity index’ works on a peer pressure principle. For example, if a group of friends or family are members of Mybarackobama.com and they see that a member of their circle is only indexing 1, it’s likely the will give that person a hard time about their lack of involvement. Peer pressure (with its high school negative connotations) is a motivating social phenomenon that Obama is using to mobilise his online supporters.

This learning is important to any company marketing their service or product through a social network. If your call-to-action involves the consumer moving from the virtual environment to in store, telephone or even voting poll then creating transparency in the user experience is important. Allowing friends to see their group’s involvement or activity in a given area means that there will be a natural form of peer pressure – even if it is only a comment on their profile. Basically, social media mobilises only when it takes on characteristics and motivations inherent in the ‘real world’ such as peer pressure.

Mybarackobama.com

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