You’re driving down the road and hungry for a burger when your iPhone beeps, “20 percent off at Burger King one block east from next exit ramp.” Or you’re thinking about a vacation in Hawaii, when hotels on Maui seem to be competing for you to book a reservation.
The power of this instant messaging seems undeniable. What better way to sell something to consumers (or businesses) than to know what it is they need before they express it? This is not a coffee commercial seen by people who don’t drink coffee. This is marketing to people who are in the market for what you’ve got. Right this minute.
The hitch? As it turns out, “pushing” a carefully curated marketing message to a consumer on a mobile device is not quite as straightforward as it sounds. This is not to say that this ubiquitous and fast-growing business-to-consumer (B2C) mode of marketing isn’t capable of cost-effectively increasing sales revenue.
It is. The problem is picking from a vast and ever-evolving assortment of tools promising to effectively reach consumers on the go.
The first mobile marketing tools were designed to analyze the buying behaviors of current customers to determine their intent to purchase something else or the same thing again. “The goal is to understand the consumer’s preferences to develop a profile of this person,” says Mike Rooney, senior vice president and general manager at BPMonline, a provider of customer relationship management (CRM) solutions. “People leave a breadcrumb trail—their social media interactions, Web browsing, search histories, online shopping cart patterns and other behaviors.”
Following these breadcrumbs tells marketers a lot about the person.
Knowing the person’s behaviors, marketers can create timely messages that are likely to appeal to the individual’s purchasing interests. Since other non-customers’ behaviors are likely similar, analyzing their search, browsing and transactional behaviors gives marketers the opportunity to target these consumers with the same compelling messages on their mobile devices.
Fast, Furious Growth
Last year, U.S. companies spent nearly $29 billion to reach consumers on their smartphones, tablets and laptops, a more than 50 percent increase from what they forked over in 2014. With that kind of marketing spend, small wonder that mobile marketing startups sprouted like mushrooms to serve the burgeoning interest. Some are a marvelous utopia of marketing, well-tested tools that will turn the needle on the sales meter. Others promise far more than they can deliver. “The primary risk of investing in mobile marketing technology or any kind of data analytics is the ‘shelfware effect’—something so complicated, complex and with so many wrinkles that marketers can’t put it into action,” says Andrew Moravick, senior research associate, marketing effectiveness and strategy, at Aberdeen Group.
More than half (56 percent) of marketing organizations currently use predictive analytics in their current marketing efforts, says Moravick. However many of them are “kind of doing stuff just to do stuff,” he adds.
Not that he and other marketing experts don’t see tremendous value in the predictive analytics at the heart of these tools. A survey by Lattice Engine of 308 CMOs and business unit directors whose companies have invested in predictive analytics credits the technology with increasing the respondents’ marketing ROI by more than 25 percent.
Says Moravick, “Mobile marketing makes tremendous sense.” Here’s why: By accumulating a vast storehouse of information on each of us—scraping our social media musings, recording our Internet browses, staying abreast of our changing demographics, compiling lists of our recent purchases and accumulating other personal details we’re willing to share, algorithms embedded in the tools can accurately posit what we’re in the market for.
Armed with this intelligence, a seller that swoops in with a persuasive message to a consumer at the opportune time already knows it has the person’s interest and attention. There’s a dark side to all this spit and polish. If the marketing message is late or even slightly off, if the tool has dug too deeply into our personal lives or if there are just too many messages barraging the consumer one after another ad nauseum, the strategy can be worse than ineffective. It can blacken a company’s brand, making consumers hate you. Really, really hate you—and spread their disgust like a malevolent Johnny Appleseed.