What’s Causing The Missing 1% In Mobile Commerce Conversion Rates?
In our last post, we talked about the missing 1%? – the lost conversions that still manifest even after you launch a mobile optimized site. Today, we will address it’s cause – marketing. Or to be more precise, the lack thereof.
According to McKinsey & Co, global spending on marketing exceeds $1 trillion and has been growing at a rate far in excess of revenue growth for several decades. To be clear and succinct, marketing matters! And marketing to the mobile consumer is all new and different. The person viewing that smartphone screen may be the same one who has been purchasing from your E-Commerce site for years, but remember, when that person visits your site on their smartphone, their context is different. How? Answer: They are MOBILE! Please accept my sincere apologies for bolding the world “Mobile”; we do so because we cannot overstate the importance of understanding what this means. The root word of everything related to mobile commerce – mobile marketing, mobile shopping, mobile advertising, etc. – is MOBILE. Being mobile means that your mobile customer is out and about, moving, distracted, and trying to access your site via a small device with small screens, cruddy networks, and tons and tons of distractions. The mobile commerce game is all different. So, marketers and managers need to make sure that we engage customers based on this crazy mobile context.
Engaging the mobile customer with mobility in mind requires that we adopt a whole new way of thinking about the mobile context. Fortunately, we at mShopper have been thinking about this problem for almost nine years and have developed a simple framework to help marketers organize their thoughts – and campaigns – as they seek to engage mobile customers and recapture the missing 1%! We call this framework our “Space, Time, And Impulse Mobile Marketing Framework” and it works like this:
Space. Space is a reference to location of course. From now on, marketers must always ask “Where are my customers?” as they seek to engage their would-be customers. Historically the place of engagement was typically the store itself. With the advent of the Internet, the place of engagement was a laptop/desktop computer. In either case, the customer wasn’t mobile. We knew where they were. This presumption is no longer valid over 50% of the time. Why? Because mobile customers are by definition mobile; they are out and about. They are in their cars, trains, buses, coffee shops, stores, places of interest, gyms, stadiums, visiting friends. They are anywhere and everywhere except sitting in front of a a laptop or desktop computer. Why can we presume this? Because if they were in front of a desktop or laptop computer, they would be using that device to visit your store!
To a marketer, ‘omnipresence’ sounds ominous. But… by applying a little cognitive energy (and with the right tools and permissions), space can be a marketers best friend. How? Because, more often then not, space can offer great insight into a customer’s purchase intention. Assume for a moment that you are the VP of greatshoes.com, a pureplay, online-only retailer of footwear. In this capacity, how much would you pay to be able to engage a would-be customer who just walked into a Payless Shoes location? Or lets assume you are the VP of Marketing for Payless Shoes? How would you engage a customer who just walked into one of your stores? These are just two simple examples. The truth is that going forward, space may well be the most important marketing tool we will ever have because not only does space offer great insight into a would-be customer’s purchase intent, but if deployed correctly, location based marketing affords marketers an opportunity to engage customers prior to sale while they are actually on the final stages of that customer’s purchase journey (McKinsey calls this “the consumer decision journey”. Think about all the opportunities at venues, arenas, museums, airports and transportation hubs, restaurants, grocery stores… Marketers can now engage consumers wherever they spend their money, before they spend their money! This concept is especially exciting for pure-play online retailers who have long struggled to extend their revenue generation footprint far beyond the confines of the Internet.
Time. If there is an aspect to mobile marketing that is as important as space, it’s time. Marketers have always considered time in their marketing mix, but rarely with the granularity that is required by mobile marketing. To marketers, time historically meant considering seasonality, occasionality (birthdays, holidays, etc.), or perhaps weekend vs weekday. With the onset of mobile commerce, time has become far more granular. Now, marketers must consider time down to the hour, minute, or even second! Is it rush hour and customers are on a train? Is it lunch hour? Is it a weekend and your customers are at a big game? Time must be considered in this way. And, as the overlapping circles suggest, time is best considered in tandem with location. It’s one thing if a customer is walking around near the food court in the mall at Noon; they are probably thinking about lunch. But it’s a whole other thing at 8AM when they are thinking about breakfast! And, by thinking about time at the most granular levels, whole new spheres of opporunity exist to trigger new revenues streams. Imagine for a moment that you’re the director of marketing for onlinefangear.com; think about how powerful the marketing moment is when a player makes an iconic play or scores the winning basket? With the right mindset – and tools – engaging at that precise moment of ‘space-time’ is very, very powerful! These are amazing new insights into contextual behavior patterns that can either prevent or promote a sale. And it all depends upon your understanding of this new paradigm!
Impulse: Impulse is the last component of our mobile marketing framework. Impulse is the motive engine behind mobile commerce. Think of impulse as that unseen energy force that causes your would-be customer to break out his/her phone and visit your site. And impulse can be anything. It can be a radio ad in the car, a print ad in the café or at home at kitchen table, a random thought like “Oops, I forgot to by Mom a present..” It might occur in a store when a would-be purchaser wants assurance that a price is fair…. What about when a store doesn’t have the right size? Social media alerts from friends…”I just got the best shoes from groupon”, or “I need to replace my dead car battery”. Impulse can be anything. And impulse happens everywhere, all the time…
In fact, impulse is perhaps the most exciting component because marketers can create impulse. One could argue that creating impulse is one of a marketer’s most important functions. And as the mShopper framework suggest, creating impulse at precisely the right moment of space and time can easily lead to the holy grail – the zone of maximum R.O.I. Imagine for a moment that it is indeed a brave new world out there… And that we marketers are on our game. And Tom Brady just throws a picture perfect touchdown pass to win the Super Bowl (please note I am not a Patriots fan so this scenario is disturbing to me personally :)). Now imagine transmitting a time-limited offer to save 10% on an official Tom Brady kid sized jersey that is transmitted 30 seconds after the score to everyone in the Stadium and to everyone at every Buffalo Wild Wings location across the country…. This is the power of mobile marketing. And by mastering mobile marketing, not only will you recapture the missing 1%, you will probably create an all-new conversion rate benchmark, the mobile marketing gold mine!