5 Things To Avoid in Mobile Commerce This Holiday Season

As consumer confidence in mobile grows, so does mobile-originating traffic to retail Web sites. In fact, according to a June 2014 comScore report, fully 60 percent of digital media time spent online by consumers is originating from smartphones and tablets, a figure that has increased 50 percent over 2013.

In February of this year, an inMobi study showed that only 11 percent of consumers report accessing the Web mostly from a computer. A recent index of 350-plus retailers saw a same-store year-over-year increase in mobile commerce revenue of 102 percent.

Any online retailer that does not yet have a mobile commerce site is now way behind the curve and is potentially losing money every day.

Mobile commerce is hotter than a five-dollar pistol and offers some tremendous opportunities for retailers who are ready to take advantage. But pitfalls also exist.

Here are five things that online retailers should not do this holiday season if they want to take maximum advantage of the mobile revolution that is transforming the retail landscape.

1. Do not treat mobile as a shrunken version of your main site
While it might be fine for a tablet, serving a resized version of your main site to your smartphone traffic can kill conversion rates and disappoint your customers.

Responsive design has been pitched as a way to display your main site on any screen, but cramming large images and content into the mobile context slows page-load speeds to a crawl, hurts conversions and causes bounce rates to surge.

Responsive design might work fine for content sites, but retailers should not expect a shrink-to-fit approach to satisfy an increasingly savvy mobile consumer base.

Internet Retailer reported in June that, among 12 top-tier responsive mobile sites, the average page-load time was more than 18 seconds.

From the article, “A one-second delay in Web site page load time translates into a 7 percent loss in conversions, according to research firm Aberdeen Group Inc. So if an e-retailer makes $100,000 a day from its mobile site, a one-second page delay could mean around $2.5 million in lost sales every year. If that’s the case, what does an 18-second page load time mean?”

Adopting a mobile-first methodology means you end up dumbing down your ecommerce site to ensure that pages display fast and well. Throwing out the ecommerce baby with the mobile bathwater is not the answer.

Smart retailers see mobile as just what it is: a separate channel with separate use case scenarios that should be treated as such.

Unshackling your mobile site from your ecommerce site pays off with big dividends, in direct proportion to the size of your mobile audience.

2. Do not over-deliver to your mobile homepage
Why would you deliver all your traffic to the same page universally when that traffic might very well be originating from a link that is very product-specific?

Deep-linking is a must these days, and allows smart retailers to sharpen the path to purchase and reduce friction.

While deep-linking a tweet, Facebook post or even a scanned physical QR code to a product detail page and tracking everything is a great first step, mobile landing pages are an even better approach.

Large brands are using branded, custom-designed mobile landing pages to immerse consumes who are pre-qualified to be interested in a certain item. These pages feature omnipresent “Buy Now” buttons to capture the intent to buy without making the consumer scroll and click all over to purchase the item.

If well designed with an easy path to purchase, mobile landing pages can deliver conversion rates many times the rates associated with normal mobile site traffic, since they deliver the consumer to the sweet spot of the mobile commerce site.

3. Do not set it and forget it
Simply having a mobile commerce site is not good enough. It is the bare minimum ante. Retailers should always be iterating and tweaking and even fully re-designing mobile commerce sites on a periodic basis to take maximum advantage of this new sales medium.

Again, mobile is not the same as ecommerce and different things work for different reasons.

Evaluating analytics to identify a mobile commerce site’s top five friction points and fixing them is a great first step.

Often a pop-up email modal or some other gimmick that works well on the ecommerce site will cause mobile consumers to instantly abandon the site. This is another reason why responsive sites tend to under-perform.
Mobile is different and it should not be assumed that what works on your main site works on mobile.

Test, iterate, re-test and refine the mobile experience to ensure you are always increasing your conversion rate and decreasing your bounce rate.

Do not be afraid to embark on a site redesign.

4. Do not ignore mobile wallets
While most press these days is around in-store mobile payments (think Apple Pay), remember that mobile wallets can also serve as friction-reducing tools for mobile commerce sites, allowing a customer’s address and payment information to be auto-filled in.

The checkout process can be a bit tedious on a smartphone, and tools such as Google Wallet and PayPal Mobile Express Checkout allow a customer to pour in their payment information and ship-to address in a single click. The upside of adding this feature can be very significant.

Rockport was the first online retailer to use Google Wallet for its mobile site and has since reported that nine out of 10 consumers who start the checkout process with Google Wallet continue through the process and checkout. When you compare this to an industry average for converted purchases, the upside is beyond obvious.

In 2013, a study by Jumio reported that $15.9 billion in mobile commerce sales were left on the table for that year due to a 97 percent average cart abandonment rate for mobile.

Sure, things are busy and it takes time to add any new feature, but something that can significantly boost your conversion rate usually comes with a rapid ROI and is well-worth doing.

5. Do not forget your physical stores
Smartphones are in people’s hands and are always on. Too often, the commerce team that handles the mobile site and the marketing teams that handle the in-store experience and display are siloed off from one another. These teams should be meeting, talking and finding ways to use in-store mobile engagement to further both their missions.

Consumers in a store are highly pre-qualified to be interested in your products. Mobile engagement can mean the difference between knowing nothing about your store visitors and adding them to your customer logs.

QR codes, NFC and SMS can all be used to deliver a link to an interested consumer that can trigger the launch of a page custom-designed to receive this traffic.

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This article was the lead story in Mobile Commerce Daily on October 24, 2014. Wilson Kerr is vice president of business development and sales at Unbound Commerce, Boston. Reach him at wilson@unboundcommerce.com.

Untether Mobile To Capture Its Full Potential: The Case Against Responsive Design

The hype about mobile responsive design reached a crescendo about a year ago and it’s easy to see why. On the surface, the pitch resonates. Why manage multiple sites when you can manage just one and have it resize itself for all channels? Simple, right? Not so fast.

When mobile only made up 5-10% of a retailer’s traffic, the pitch resonated, but the flaws in this approach have been exposed as mobile commerce has grown far-faster than predicted and has evolved into a unique channel that drives significant revenue for retailers.

The notion of “one web” for all audiences might suffice for content sites like newspapers or magazines, but, for retailers, the mobile channel now deserves more than a reformatting of a desktop site, shrunk to fit a smaller screen.

Some Serious Numbers

According to comScore, mobile traffic now makes up 33% of all digital traffic for Wal-Mart, 33% for Best Buy, and 37% for Target. These are some serious numbers and for online pure-plays they are even higher (and increasing fast).

And it’s not just traffic. According to eMarketer, 2013 mobile sales are up 68% over 2012. Deloitte just reported that almost 70% of US smartphone owners intend to shop on their smartphones this Holiday Season, with smartphone market penetration now over 60%.

According to IMRG/Capgemini, mobile commerce made up 23.2% of all Q213 online sales, yet only 51% of smartphone owners reported making a purchase in the last 6 months. This means we are only seeing the tip of the mobile commerce iceberg. eBay alone will exceed  $20B in mobile sales this year.

As traffic and resultant revenues skyrocket, mobile is quickly evolving into a distinct channel that deserves to be treated as such. No longer does a “smaller copy” derivative version of an ecommerce site make the grade and retailers are starting to notice.

The Google Factor

Google famously gave responsive a boost, when it “officially recommended” it back in 2012. But one only has to look at how Google makes it’s billions to see why. A responsive approach makes their job easier, as they can crawl and rank a single entity, versus several. Google’s main point in this same post was to recommend 1) Having a mobile site 2) supporting deep linking and 3) fast pageload speeds. All three of these points, it can be argued, actually lean toward a deep integrated approach, versus responsive.

To be clear, having a mobile-specific “mdot” site does NOT mean SEO rankings will become “diluted” or hurt a page rank. In fact, since their “official” recommendation, Google has specifically stated that a responsive approach does not benefit rankings and it is standard practice to add ecommerce page tags that instruct Googlebots regarding the fact that there is alternate content and where it can be found. In fact, Google itself uses rich mobile-specific sites, versus responsive.

The negatives of running all your channels of consumer interaction off a single base of HTML can be most-easily be seen when looking at performance rankings, as the same imagery, graphics and text used for ecommerce are re-rendered for mobile, while load times differ.

Also, a resized version of an ecommerce site means only what first exists on the ecommerce site can exist on the mobile site. This is called the “necessarily derivative limitation” and it’s key to understand. This same limitation also applies to transcoded sites, by the way.

Inextricably Intertwined

A mobile (or tablet) site inextricably intertwined with the “upstream” ecommerce site features and functionality  can trap retailers into an inability to shape the mobile site specifically for their rapidly expanding mobile customer base, to capture maximum ROI and respond to evolving mobile buying trends.

A responsive approach also means the changes made to the ecommerce site can cause problems that cascade downstream, as graphics, text and site elements meant for large-screen ecommerce often translate poorly into the smaller mobile site context. These problems are usually discovered when the new etail content is pushed live and then negatively impacts the mobile site.

Much has been made recently of a re-positioning of responsive design, sometimes called “server side responsive”. And this is often positioned as a fix to “traditional responsive” (which necessitates a site replatform). But this is really just a rebrand of the same solution, using better detection methodology to try to render different slices and dices of the site, based on the device detected. The essential limitation remains. It cannot exist on mobile if it does not first exist on ecommerce.

More Effort But The Payoff Worth It

Building and managing a site built specifically for the mobile channel might take a little more effort, but the payoff is that a retailer can tailor the mobile site experience for maximum effect by adding mobile-specific features and functionality catered to a growing mobile audience.

And there are real examples. IR 500 retailer Finish Line was quite open about the foray it made into responsive, as an element of their ecommerce replatform, taking the unprecedented step of announcing a $3M loss associated with the botched transition. And an increasing number of large retailers are investigating ways to unhinge responsive mobile sites from upstream etail functionality.

An alternative to a “derivative” responsive mobile site (and certainly a transcoded site) is one based on a deep integration with an ecommerce infrastructure using API calls. The template for the mobile site is unique and built from “whole cloth”, using best practices specific to the mobile channel. Data (price, size, sku, color, availability, imagery, etc.) flows seamlessly in real-time from current ecommerce operations and is cached locally. Third party services are integrated and the software that powers the site can be licensed and hosted by the retailer, in-house. Promotional images are designed specifically for the mobile channel and loaded via a control panel dashboard.

In this way, current ecommerce operations are leveraged and extended into mobile, while the retailer has the freedom and flexibility to offer mobile-specific features and functionality designed to drive mobile revenue. And they have full in-house control of the entire site.

Up to 6X Faster

An independent survey of mobile commerce sites conducted by Marlin Mobile showed API-integrated sites load up to 3X faster than transcoded sites and up to 6X faster than responsive sites. Industry-wide conversion rates for all mobile sites in their totality lag behind ecommerce, so reducing friction and ensuring optimal performance is an imperative.

A deep integration approach also does not necessarily mean more work for the retailer’s IT team. While this is a common refrain among responsive solution providers, the fact is that, once APIs are mapped for a specific ecommerce platform, this “pre-integration” can be applied to all retailers using it, with tweaks and additions made to link up 3^rd party services like recommendations or reviews.

IT Involvement: More Is More

Also, it is increasingly viewed as a positive to have the merchant IT involvement, as more and more retailers want the option of licensing the software and running mobile on their own servers, to take technical and creative control of a channel that’s responsible for an ever-growing percentage of revenue.

Mobile buying behaviors are different and the channel is different, and, as it grows rapidly, smart retailers are untethering the mobile experience from their ecommerce site functionality, to take maximum advantage of mobile commerce in ways only just starting to be understood.

 

Bananas For QR Codes: The Mobile Low Hanging Fruit

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The Other Day I Scanned A Banana (The Good

Yes, that’s right, a single, offline, real banana. Latin name Musa Acuminata. More specifically, I used my smartphone to scan a sticker on the banana. The banana itself had no power supply, or web connection.

I happened to buy this particular banana at a Wal-Mart in Florida (while on a fishing trip) and noticed that the ubiquitous banana “fruit company” sticker contained a mobile quick response (QR code).

I opened the scanner on my iPhone and scanned the code. In doing so, I opened a portal to the internet, a live action window into an online mobile-optimized experience that taught me something new. That engaged me. Cool.

The Del Monte QR Code

Seldom had I considered what company grew and shipped and sold the bananas to the grocery store I bought them from. Did you know that the Del Monte Fresh Produce Company was founded in 1886? (This is the year Apache warrior Geronimo surrendered and the Statue Of Liberty was dedicated). Did you know that Del Monte has 42,095 “likes” on Facebook and that they also sell a fruit called a Pluot? Did you know they own the domain http://www.Fruits.com?

Well, now you do, because I learned this on the Del Monte mobile-formatted  Facebook page that opened when I scanned the QR code.

Where I Landed When I Scanned The Del Monte QR Code

It took me about 5 seconds to scan and engage with the company whose product I was about to eat. It was not hard, it was easy. I would do it again.

The Other Day I Scanned A Banana (The Bad)

Yesterday I got my chance. This time I bought a banana at Wilson Farms in Lexington, MA. It too had a QR code on it’s sticker. When I scanned it with the same iPhone app, my mobile browser opened a standard large-format website for Chiquita Bananas, crammed on my little iPhone screen. Lame.

The QR code sticker said “Scan To Win!”, but I could see no easy way to sign up for anything and I could barely read the website on my small iPhone screen. I pinched a zoomed-in a few times and then shut off the phone.

The Chiquita “Scan To Win” QR Code

A Poor Experience On my iPhone

Unlike the Del Monte banana, the Chiquita QR code scan offered up a poor mobile experience and I was left with the distinct feeling that Chiquita needed a lesson in mobile marketing. Perhaps they will read this and call me.

Action-Enabling Ads…and Products

Some naysayers in the mobile marketing business scoff at QR codes as a gimmick or a passing fad. They talk about how hard it is to open the scanner app and actually complete a scan that opens a mobile browser window. I disagree. In lieu of another option that is this easy and simple, I find them a powerful mobile engagement tool.

In 2011, almost 60% of Twitter and Facebook users said they scanned a QR code. This is a LOT of people. In my opinion, any marketer or brand manager who sees this as merely a passing fad needs to open their eyes. QR codes allow a  low-cost “window to the mobile web” to be attached to anything. Nearly 10% of ads in magazines today feature QR codes that “action enable” a static, lifeless print ad and allow a tracked consumer interaction to occur.

Ninety percent of all QR code scans are done to obtain more information about the products and services advertised. If done right (like the Del Monte banana example) this can result in metrics that can justify an ad spend as ROI. This could be in the form of contest sign-ups, new Facebook “likes”, or even transactions. If done hastily and without thought to the mobile experience being provided (like the Chiquita banana), the result can be a poor customer experience and a squandered chance to engage mobile consumers.

Cha-Ching

Again, done the right way, QR codes are an easy, low cost way to add a mobile “window to the web” to any static ad or physical product, to drive consumer engagement. For print ads, custom mobile landing pages can be generated, to maintain the look and feel of the ad campaign.

If linked to an integrated mobile commerce site that supports deep linking (shameless plug for Unbound Commerce), a QR code can be a call to action that allows a consumer to convert a purchase right then and there. If a little “cha-ching” did not go off in the head of online retailers, it should have.

Low Barrier To Entry

The barrier to entry is so low, that there is little reason marketing depts should NOT be experimenting with QR codes. Smart eCommerce Directors that are launching mobile commerce sites should be telling them to, since they can use QR codes to drive tracked incremental commerce though their mobile commerce site!

The addition of a QR code can transform a static, non-linked print ad, in-store sign, or even a real product (like a banana) into a powerful engine for tracked mobile or social engagement and  commerce. I see QR codes as a viable and exciting new way to infuse tracked links into marketing, so literally anything can come with an integrated mobile call to action.

I had no idea two bananas would show me this, but they did.

Lessons

Certainly, scanning a sticker on a banana is not going to redefine mobile commerce or set the mobile/social marketing world on-fire. It is, however, a lesson regarding how easy it is to engage increasingly-mobile consumers by adding a link, a mobile call to action, that, when applied to other more commercial mobile commerce scenarios has the ability to generate real sales lift, as ROI.

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Wilson Kerr is VP of Business Development and Sales at Unbound Commerce. And yes, he is bananas about mobile commerce and mobile marketing and linking the two together. Contact him today at Wilson@UnboundCommerce.com or via Twitter @WLLK.

Mobile Payments: FAQs for Retailers (Guest Post)

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This is a Guest Post of an excellent piece written and posted by Michael Koploy, ERP Analyst, Software Advice (an online resource on retail technology), on his blog.

Mobile Payments and Mobile Commerce are two different things and are often confused. I am an expert on the latter and Michael has done a great job of laying out a great FAQ-formatted overview of the former. He contacted me and asked me if I would mind guest-posting. You can link to his post here, or simply read-on. Excellent work Michael.

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January 25, 201

According to US research advisory Gartner, mobile payments may be the next big thing for retailers. The firm predicted 38 percent growth of mobile payment users in 2011, totaling 141 million.

While this may seem like a lot, the industry still has a long way to go and there are a number of roadblocks ahead, according to Sandy Shen, Gartner Research Director. “The biggest hurdle is the need to change user behavior by convincing consumers to pay with mobile phones instead of cash and cards,” says Shen.

Retailers can play a large role in changing user behavior. While manufacturers can produce the phones to process mobile payments and merchant service providers can set up the networks, a lack of retailer support will lead to little (if any) mobile payment adoption.

The first step for retailers is to educate themselves about the technology, the ecosystem and the opportunity mobile payments afford. Software Advice, an online consultancy for point of sale systems, hears from a lot of retailers that are curious about mobile payments. Here are the top five questions they hear with their answers:

(1) What are mobile payments?
Mobile payments are payment transactions involving mobile devices and RF receiver terminals. Both mobile devices and terminals are equipped with RF chips to communicate via near field communication (NFC). The mobile devices communicate with the terminals through a virtual wallet application.

(2) What does a retailer need to do to accept mobile payments?
Outside of the other requirements for retailers to accept credit card transactions — merchant account, payment gateway, point of sale software, etc — retailers will need either an NFC-capable credit card machine or a standalone NFC receiver. Standalone receivers are often much cheaper — sometimes as little as a couple hundred dollars.

(3) How much will mobile payments cost the retailer?
The interchange rate for mobile device payments is the same as MasterCard PayPass and Visa payWave; the rate is higher for these transactions than for traditional swipe-and-sign payments. Visa lowered rates to spur NFC in Italy–it could do something similar in the US, but this is unknown at this point.

(4) Are there security issues that retailers need to be aware of?
NFC signals are transmitted at a short range of a few cm (and up to a few meters in some rare circumstances), so the hacker would have to be close to the mobile device, as well.
Additionally, virtual wallets require PIN passwords for access–making a stolen virtual wallet much less valuable than a stolen credit card. Most phones also have additional security features, such as home screen password-lock.

(5) What should a retailer do to prepare for mobile payments?
All of the individual players in this ecosystem–from the financial institutions to the consumers–are playing a game of wait-and-see. Retailers can do well by staying on-top of NFC-related news and testing out similar technologies available today (e.g., Google Places), as well as other NFC happenings in the community, such as the recently announced McDonald’s NFC awareness campaign in the UK.

For a full list of the top ten FAQs, check out Software Advice’s Mobile Payments: FAQs for Retailers.

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Again, this is a Guest Post of an excellent piece written and posted by Michael Koploy, ERP Analyst, Software Advice (an online resource on retail technology), on his blog.

Turning Point 2011: Mobile Commerce By The Numbers

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Over the last 4 or 5 years there has been vigorous debate regarding when, exactly, the true potential of mobile will be realized. Mobile mapping, mobile TV, check-ins, mobile payments, push ads, games, QR Codes, NFC, Daily Deals, SMS, virtual mobile currency, pop-up ads, barcode scanning, coupons, and a litany of others have had their moment in the sun, but none have generated commerce upside at a truly transformational level.

Turning Point 2011

Finally, as 2011 came to a close, we saw real, tracked and reported numbers that were far too numerically impressive to be dismissed as a fad or trend. These numbers were tied to Mobile Commerce.

When I say mobile commerce, I do not mean mobile payments, which I define as paying for items at checkout, using your mobile phone. I an referring to online sales converted on mobile websites specifically designed and formatted for this purpose. Example: m.finishline.com

Retailers & Brands Lag Behind, Fueling The Opportunity

For years, online retailers and brands waited, while their customers flocked to web-connected smartphones and, as a result, small screens are now crammed with large format websites never designed for this purpose.

In late 2011 retailers and brands finally started waking up and launching mobile optimized sites, and this fueled explosive growth and big profits for those still out ahead of the curve.

Mobile consumers can finally land on mobile-optimized commerce-enabled websites and the traffic to these sites can be converted into transactions in a trusted, secure environment. These mobile conversion metrics are the key and the resulting revenue numbers are real, undeniable, and impactful.

Changing Expectations

As more brands and retailers launch mobile commerce sites, consumer expectations have changed rapidly. In fact, most consumers surveyed now expect mobile sites to not only function, but to work better than  standard e-commerce sites.

Retailers and big brands are finally realizing that mobile commerce is not some fringe distraction to their e-commerce team, but, rather, a way to add 10-20% to their bottom line in incremental revenue. That’s right, retailers and brands are not stealing from Peter to pay Paul, and most see no drop in “traditional” online sales. It’s all upside.

For athletic shoe retail giant Finish Line, their mobile site now makes up 14% of their total online traffic. For adult online retail leader Adam & Eve, mobile commerce accounted for a whopping 8% of their total revenue, only 2 weeks after it was launched.

Still not convinced that mobile commerce has ushered in a revenue-fueled turning point that should/will change the entire tenor of the mobile space? Here are the numbers.

2011 Mobile Commerce Stats

-PayPal saw a 397% increase in consumers shopping via PayPal Mobile on Cyber Monday 2011, vs 2010.

-Rue La La saw an almost 200% increase in mobile sales on Cyber Monday 2011 vs 2010.

-Ebay’s mobile commerce doubled to $5Billion+ in 2011

-Ebay’s Black Friday mobile commerce sales were up 516%, over 2010.

-2011 mobile commerce sales were up 91.4% over 2010.
– In 2012, mobile commerce is expected to increase another 73.1% to $11.6 billion.
-The average mobile commerce purchase was $123 (vs. $87 for purchases from desktop PCs).
-Shopping by mobile users doubled from 1.87% to 3.87% of all online purchases in the past 9 months!

-During the 2011 Holiday season, 44% of all Google searches for last minute gifts and store locator terms were from mobile devices

-Of consumers surveyed, 70% use their smartphones in stores and 77% have contacted a business via mobile.

–64% of smartphone owners age 18-24 used a smartphone to find a deal this Holiday season.

-There were 20Million mobile bar code scans in Q3 2011, a 40% increase from Q3 2010.

-According to IBM, mobile traffic made up 18.3% of all online traffic on Christmas day 2011.

Conclusions

Mobile commerce transactions can occur anytime, anywhere and are being initiated on smartphones carried religiously by almost 50% of Americans. Online sales are no longer occurring only in front of a desktop or laptop, but anywhere and anytime. Retailers and brands should take notice.

Even more importantly, mobile commerce sales can be triggered by real world interactions with marketing initiatives most retailers and brands are already paying for! Printed mailings or catalogs, in-store point of purchase displays, peer to peer recommendations, signage, social media campaigns, emails, etc can all serve as mobile trigger points, when they are accessed by mobile consumers. The (largely untracked) digital media marketing spend already occurring can be tapped to drive mobile commerce, with tracked results. This means that smart brands (or their agencies) can (and should) be able to adjust these campaigns on the fly, to maximize ROI, in the form of tracked incremental mobile commerce revenue.

The biggest takeaway here is directed toward online retailers or brands who still do not have an integrated mobile commerce solution. Read and digest the numbers above and ask yourself this simple question, “How easy it is for a mobile consumer to visit my website and convert a sale?” (Hint: Try it!).

If you do not have a mobile site, the answer will be painfully obvious. Make fixing this your 2012 New Year’s resolution!

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Wilson Kerr (@WLLK) is a mobile LBS marketing expert, and VP of Sales and Business Development for  Unbound Commerce.  Contact Wilson today to learn more. Mobile: 303-249-2083.

Some of the stats in this post were compiled from various sources by Gabrielle Kalika of Mobile Marketer. I have added added more my own, also compiled from various sources. All stats can be verified, via Google search.

How SMS Can Support Mobile Commerce Sales

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Mobile Marketer Senior Editor Giselle Tsirulnik recently interviewed me, regarding the role that SMS can play in mobile commerce. I am re-posting this interview and expanding some of my answers.

I hope this post gives retailers and brands insights into ways that “Trigger Point Marketing ™” like SMS can be used to link tracked mobile commerce sales with the social sharing of the specifics of  a product or price, by customers. When consumers share the news about something they recently bought among their social network, the effect can be powerful, as long as retailers can track the resulting lift via mobile commerce transactions.

Here is an extended version of what I said:

Q: What is the benefit (for a brand or retailer) of having a consumer SMS/MMS a product they are viewing via a mobile commerce site,  to a friend?

A: This sort of social sharing means the retailer or brand has a new touchpoint delivered instantly to a highly prequalified audience. Since the text arrives from a trusted friend, the person who receives it is very likely to open the text, read it, and click on the link. It stands to reason that the conversion rates for the recipient of the SMS would be many times higher than traditional marketing blasts.

By providing the tools needed for consumers to repackage and redeliver a marketing message to a highly prequalified audience within their own social graph, retailers can tap into a very potent mixture of personal referrals and siphon off additional mobile commerce sales.

Q: How could this potentially drive sales for a retailer?

A: Smart retailers are increasingly offering their customers tools whereby they can share the deal they just got. Word of mouth and personal referrals consistently ranks amongst the highest-ranked reasons consumers visit a store or retail website. If the retailer has a mobile-optimized site, an SMS sent by a customer can serve as a delivery mechanism for a deep link right into the section of the mobile commerce site where the exact product that was purchased (or product grouping) is queued up and ready to buy for the text recipient. This can directly, positively impact mobile commerce sales and, more importantly, can be tracked, measured and even used as a way to reward consumers who have spread the word.

Q: Do you think more retailers will be incorporating SMS into their mobile sites in 2012?

A: Yes, retailers interested in stay relevant will utilize a variety of new ways to have hyperlinked touchpoints spread by pleased, loyal consumers.  In a few clicks, the recipient of the text message can buy the item their friend bought and also have the opportunity to pass the word along. By adding this option pre or post-purchase, retailers can infuse their mobile commerce sites with

As SMS starts to replace email with younger generations and more and more retailers build and launch mobile commerce retail sites, this method of “Trigger Point Marketing(tm)” is a great way to drive tracked ROI. SMS is alive and well and retailers should certainly add it to their marketing mix, in support of mcommerce.

Q: Why is SMS a good medium to encourage sharing?

A: An SMS text message is instant and it is personal and it generally comes from a known, trusted sender. For these reasons, a whopping 98% of all text messages sent are opened by the recipient. No other form of digital marketing even comes close.

SMS also opens up a new channel of communication between the retailer and the consumer and builds a retailers database of contacts, since the mobile commerce platform captures the mobile phone numbers of both the sender and the recipient.

Q: What are some other ways SMS can be incorporated into a mobile commerce site?

A: When integrated into a mobile commerce site as a “social share feature”, SMS can also be tapped to distribute pre- and post-purchase links to a product in a mobile commerce site, within the social graph of the purchaser

SMS can also be used, via short codes, to drive traffic to a mcommerce site, when a hot link is sent back to the consumer, by the retailer. Additionally, SMS can be used to sign up customers to loyalty programs or allow them to opt-in for announcements of new arrivals, etc. If a shopping cart is abandoned, SMS can be used to ping the customer who did not complete their transaction, to remind them that their cart is full and they forgot to check out.

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The Final Word: Mobile commerce is no longer an option for retailers and brands that sell consumer direct. Retailers that do not have an integrated mcommerce site are losing sales every minute, literally.

The linkage between proven, incremental sales and mobile marketing has long been elusive. This fact has kept a barrier up between the ecommerce team and the marketing dept. This is finally changing and the fact that socially driven messaging can be infused with deep links within a mobile commerce page means that these two worlds are finally set to merge. When this happens, marketing will be able to see a quantifiable return on their spend and the ecommerce team will have a whole new revenue stream via mobile commerce that is, in turn, supported by mobile marketing. A win-win. Remember, SMS is but one method, and QR codes and Near Field Communication (NFC) are also viable ways to drive proven, new mobile sales via”Trigger Point Marketing ™”.

The silos between marketing and ecommerce must be demolished. The retailers and brands that realize this and embrace this notion fastest will win. The rest will be left behind.

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Wilson Kerr (@WLLK) is a former Tele Atlas exec, LBS consultant, and now leads Sales and Business Development for  Unbound Commerce.

Contact Wilson today to learn more. Mobile: 303-249-2083.

Understanding The “Mobile Commerce Gap”: 5 Things Every Online Retailer Should Know

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Sometime this year, 50% of Americans will own a web-connected smartphone, yet less than 20% of online retailers have websites optimized and formatted to serve these mobile consumers.

I am calling this the “mobile commerce gap”. The reason for this inequity between demand and supply, in my opinion, is because the internal resources required for online retailers to properly develop a mobile commerce site have been pulled in other directions, even as smartphone adoption rates have exploded. As a result, a majority of online retailers are offering their mobile customers a very poor online shopping experience. This, in turn, results in poor conversion rates and missed sales, not to mention the fact that consumers are left with the general impression that the retail brand is not serving their needs.

Think about it, how many times have you visited a site on your smartphone and immediately left when you saw it was not optimized for mobile? According to Google, this happens 79% of the time!

Why this “gap”? The first distraction came in 2009 when retailers and brands alike were told they must “drop everything and build  an iPhone app”. While apps are great for some things, a vast array of surveys and studies have concluded that consumers much-prefer a mobile site over an app for commerce. The second was the social media craze of last year, as Facebook, Twitter, and the rest dominated headlines and became “must-haves”. Both soaked up internal IT resources and distracted online retailers from building the mobile-optimized sites needed to serve their increasingly-mobile customers.

So, what are the factors online retailers should consider, as they investigate offering their customers the ability to convert sales from their mobile devices via a mobile commerce site? I hope the following 5 points will clear some things up:

1) There is No “Mobile Web”

While it is true that most “standard” websites are capable of being viewed on a web-enabled phone, few consumers are willing to “pinch and zoom” their way into a converted sale on a standard site jammed into a small screen. Ever tried this? It’s not fun.

While the need for mobile-optimized sites might seem obvious, many retailers justify not investing in mobile commerce by citing low mobile-originating traffic to their  current site (usually 2-5%).  Of course, this low-traffic negative feedback loop is caused by the fact that mobile customers seldom return to a site after being greeted with such a poor user experience. The retailer then concludes there is no need to invest in the “mobile web”. Again, there is no “mobile web”.  There is only the web viewed on a mobile device.

2) Mobile Commerce is NOT Mobile Payments

There is a lot of “noise” right now regarding mobile payments at point of sale, when the phone is used as a “mobile wallet” to pay for coffee and the like. While mobile payments might-well emerge as an issue retailers need to address, this  is not the same as mobile commerce. Mobile payments involve banks, credit cards, investments in point of sale infrastructure, coupons, NFC,  loyalty cards, and a whole array of complex issues.

Mobile  commerce is simply the act of ordering something online, from your mobile phone, via a mobile-optimized version of a website. Retailers should not confuse the two, or delay the launch of a mobile commerce site while trying to understand mobile payment options and what uniform technology may or may not emerge victorious.

3) Mobile Commerce “Actualizes” Mobile Marketing

Remember, every time a consumer clicks on a marketing or advertising link to your website on their mobile phone, they should land on a site that is optimized for the device they are accessing that message on.  Whether a tweet, a Facebook post, a banner ad, a QR code, an SMS message, or an email,  the mobile consumer who acts upon the message should be able to convert that action easily into a sale, via a mobile commerce site. If you are a retailer and do not have a mobile commerce site and are spending money on social media marketing or mobile advertising, you are likely paying to promote links to a very poor customer experience.

4) Integrate, Don’t Duplicate

There are several options for creating a mobile commerce site. You could use a transcoder to “screen scrape” your standard website and shrink it to fit a mobile screen. You could “sub-out” your mobile commerce efforts to a third party, by letting them “handle it” with their own separate and duplicative mobile store. OR you could leverage and extend your current, proven and trusted  e-commerce operations into mobile via an integrated solution. This is a superior approach, in my opinion, as it means you are avoiding duplication, while also maintaining full in-house control and fueling mobile commerce from the same infrastructure you trust today for your e-commerce operations.  A software-based integration approach takes a bit more effort on the front-side, but the long-term benefits are significant, as this single effort, if done properly, can serve as the foundation for not only mobile commerce, but also Facebook  commerce and commerce-enabled iPhone and Android apps, as needed.

5) Devote IT Resources, Plan For Growth

The single biggest reason I hear retailers give for not moving on mobile commerce is a lack of IT resources. Simply put, this is a poor excuse. While it may be true that IT is backed up, the measurable, tracked ROI that mobile commerce offers should elevate this to the top of the list. The ROI is extremely rapid, by even the most conservative estimates of the resulting tracked, incremental mobile commerce sales. Retailers and brands that are out ahead of the curve will be the biggest winners, as long as they plan for growth and chose the right approach.

Compelling Numbers

Still not convinced that mobile commerce is a “must have”? In recent weeks Google and other mobile marketing players have begun encouraging retailers to sit up and take notice of this “gap”, since they can’t sell online retailers mobile marketing campaigns if they have no place for the target audience to “land” when they click though a mobile campaign ad/link.

Google and others are pointing to studies and reports that contain numbers that are hard to ignore. Here is a sampling:

• $1.9 Billion: Worldwide online mobile sales in 2009.
• $23.8 Billion: Expected worldwide online mobile sales in 2015.
• 61%: The percentage of mobile users unlikely to return to a site not optimized for mobile.
• 79%: The percentage of Google retailer advertisers who DO NOT have a mobile site.
• 78%: The percentage of consumers who prefer a mobile site over an app.
• 62%: The percentage of smartphone owners who have purchased physical goods via their phone in the last 6 months.
• 2-5%: The typical percentage of mobile traffic coming to a non-optimized retail website.
• 5X: The typical increase in conversion rates, upon the launch of a mobile commerce site.

(Adobe-Mobile Shopper Insights, Google, eMarketer, Shop.org, Coda Research, Unbound Commerce)

Want even more evidence? I recently attended the Mobile Commerce Summit in NYC and the Keynote speaker was Steve Yankovich, VP of eBay Mobile. eBay has quietly become the largest online retailer in the world and were an early adopter of mobile commerce.

The numbers Steve shared regarding their mobile commerce success at the conference were astounding. Some highlights:

• $4 Billion: The revenue eBay expects to generate from mobile commerce in 2011, double what they sold on mobile in 2010.
• 100%: The percentage of eBay’s m-commerce sales they report as being incremental!
• 38 Seconds: The average time someone spends on eBay for a m-commerce transaction (versus 20+ minutes on their standard site).
• 100: The number of people eBay reports hiring for their mobile commerce team.
• 50X: The predicted increase in what eBay will spend on mobile marketing to support the success they have seen in m-commerce.

We are finally at a point where the numbers are so compelling that few can argue against the importance of having a mobile commerce site. The simplest way to put this is, “If you do not have a mobile-optimized commerce site, you are losing money“.

The Time Is Now

Your customers are mobile and they are very likely trying to access your site on their smartphones right now. If they still see your “standard” e-commerce site crammed onto a small screen, you are delivering a poor customer experience and, as such, are missing incremental mobile sales. Try it yourself!

Some experts expect mobile commerce to grow to become as much as 10-15% of online sales. Retailers should weigh the risks of launching a solution that is not integrated with their current operations, since what might not be a problem at first could emerge as a big issue when mobile commerce makes up a significant percentage of online sales. Find the resources, take the time, and consider building/launching a mobile site ASAP that leverages and extends current online sales operations.

You will provide consumers a positive mobile interaction with your brand that also drives significant incremental, tracked revenue. Mobile commerce is here and the time to take advantage via a mobile commerce site is now!

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Wilson Kerr (@WLLK) is a former Tele Atlas exec, LBS consultant, and now leads Sales and Business Development for  Unbound Commerce.

Contact him today to learn more. Mobile: 303-249-2083.

Show Me The Money: Mobile And Social Commerce Set To Converge In 2011

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Wilson Kerr (@WLLK) is a former Tele Atlas exec and started Location Based Strategy, LLC in 2007 to help clients harness the power of mobile.  Contact him today to learn more.

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Over one hundred billion dollars is spent annually on “traditional” online advertising, and each of the last three years have been prematurely declared the year of mobile advertising. For too long, the promise of mobile advertising has been based on technical, location-awareness-related advances the industry has heralded as beneficial, while these same advances scared consumers away.

This is finally changing and consumers are discovering simple, easy iterations of mobile technology that provide simple, easy solutions for problems they want solved. Saving money via special offers/coupons at known, nearby business locations is the best example and Groupon and their kind have driven socially-promoted savings on purchases that can be measured in increments of $Billions.

The Bridge To Mobile Commerce: Deals and Group Buying

Groupon is the fastest growing technology company in history and Founder/CEO Andrew Mason links their success to providing a “hybrid of local advertising and local commerce”.

Groupon’s unprecedented success should serve as a  lesson to the various elements involved that melding established consumer behavior and technology in a simple, easy way that also leverages consumer acceptance of social media  is a key factor for success.

The real power of this model lies in the fact that incremental, tracked purchases are made at the beginning of the consumer interaction, generating pay-for-perfomance, frontside ROI metrics that blow other “wait and see” methods of marketing out of the water. When you add in a “social media award” component (share the deal and get the deal for free), this model becomes even more powerful, as the campaigns quickly become viral and market themselves.

While Groupon, Living Social and the rest have been written about extensively, I am not sure the full potential impact of this model is understood. These companies solve an existing problem for local businesses by converting the traditional coupons, sales, and special offers they have used for decades into tracked offers that can measure in both financial upside and foot traffic. They also tap exisiting marketing budgets by stealing pre-allocated dollars away from traditional media via no-risk performance-based value propositions (that work).

This is in contrast to much-touted hyperlocal mobile push advertising campaigns that require a problem to be explained, before a retail business or brand will considering paying to try to solve it (assuming they agree the opportunity for ROI is there). More importantly, most retail businesses still do not have a way for mobile banner click-throughs to land a consumer in a place where a purchase can be converted. This is where mobile commerce comes in.

Moving The Merch: “Redemption Is Mobile Commerce”

The quote above is from Dan Gilmartin of Where.com and I agree. While redemption of printed or digitally displayed group buying vouchers brought into a restaurant, hail salon, or spa (for example) works well-enough, retailers that sell lower-margin goods want converted sales that “move the merch”, as they say. Giving 50% of your margin away to Groupon and their kind, is a fine solution for high-margin, service-oriented businesses, but retailers need to link campaigns for specials to actual sales.

Converted sales transactions, rather than impressions rendered or click-throughs to a standard website, are what attracts small to medium-sized retailers that gain little from traditional brand marketing. Since non-standardized point of sale systems for redemption are still the Achilles Heel of the mobile coupon model, tracked, mobile commerce conversions will emerge as the new, essential “redemption metric” in 2011.

With $1.5 billion in mobile sales logged in 2010 (a 3X increase over 2009), Ebay’s mobile commerce success shows that consumers are willing to transact on a mobile device. In just the 30 days before Christmas 2010, eBay transactions were valued at over $100 million  in gross merchandise value, a 135% increase over last year (Mobile Commerce Daily).

“Today’s consumers are transforming the shopping experience with their mobile phones, and retailers who have not broken down their siloed channels will not be able to keep up,” says Jim Bengier, global retail industry executive for Sterling Commerce.

2011: The Year Of Mobile Commerce

In the rush to check off the branded app and social media platform “must-have yes boxes” , mobile commerce sites were passed over by retail brands, and consumers have been left to “pinch and zoom” and fumble with large format websites not optimized mobile devices.

How big is the mobile commerce opportunity? In July of 2010, a scant 12% of online retailers had a mobile commerce site and an even smaller 2% had an app with checkout capability (Acquity Group). Even with these dismal brand/retailer adoption numbers, US mobile-commerce (sans travel bookings) grew from $400 million in 2008 to $3.4 billion in 2010, and growth is predicted to be “explosive” in 2011 (Mobile Commerce Daily). Show me the money, indeed.

In 2011, linking a smooth-running mobile commerce engine to special offer and redemption platforms/efforts will emerge as essential, as this is the simplest way to track success in a way most retailers understand. Retailers who sell online should build robust mobile commerce sites linked to their etail “technology stack” in order to capture converted sales, driven by mobile (or social) marketing. Simply “scraping” an etail website and shrinking it to fit for mobile ignores key differences in mobile vs at-home consumer purchasing-related behavior.

Social Commerce: Sharing The Wealth

Of the 620 million consumers using Facebook, the most active 200 million access the social network through their mobile device.

Why do large retailers and brands spend money building up millions of Facebook Page fans and then drive them away from Facebook to convert a sale? It’s even worse if they send a mobile consumer to a standard website.

Increasingly in 2011,  retail brands will use Facebook to promote special deals for fans, and give them the option to buy what they are promoting by linking to a mobile commerce page where that product is cued up. Facebook might-well offer these tools for businesses as a part of Facebook Deals, as they look to emulate Groupon’s incredible success.

Social commerce will take a while to catch on, but is on the horizon. It is an extension of mobile commerce, because technical integration with the “etail technology stack” is needed to create Facebook Commerce tabs, so secure transactions can take place within Facebook pages.

The power of social commerce really shines when, for example, mobile (or Facebook commerce tab) purchases driven by special deals offered to Facebook fans can be shared within (and extended to) the buyer’s social graph, after the purchase is made.

Tap, Tappity, Tap: NFC  Taps Established Consumer Behavior

I’d be remiss if I did not mention NFC (Near Field Communication) in this post. While mobile and social commerce are next up for online purchases on a smartphone, mobile payments at point of sale for smaller transactions will also be a hot topic in 2011. The path to a “mobile wallet” will be rocky, but NFC will emerge as the best way to both validate mobile proof of presence, and conduct small “tap to buy” transactions using value deduction from a secure, preloaded digital account contained within the device. Consumers know NFC and it is easy to use. The fact that three big US carriers have buried the hatchet long enough to line up behind NFC via the formation of Isis, is a powerful signal.

These inherently mobile “real life hot links” need to go somewhere, so NFC will support the rapid growth of mobile commerce as well. Watch for NFC tags to start appearing in pilots/tests on out of home advertising, packaging, and even wine bottle labels.

Conclusions

Mobile commerce drives revenue and location-specific redemption of special offers that can be promoted via social media marketing. Redemption takes the form of real mobile commerce transactions linked to promotions that mimic the powerful Groupon model, without giving up the margins. Mobile commerce will grow rapidly in 2011, as branded apps fade in importance, in direct proportion to increased data speeds,  accelerated location-enabled smart phone adoption/usage by consumers, and the creation of mobile commerce sites by retailers.

Facebook will increasingly play a role in every brand or retailer’s marketing plan. With 200 million accessing it via their mobile device, Facebook will become a place where discounts, sales, and special offers are  not only shared and compared, but increasingly parlayed into converted mobile commerce sales. Facebook commerce transactions that leverage this same technical backside integration and occur within Facebook will not be far behind.

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Wilson Kerr (@WLLK) is a former Tele Atlas exec and started Location Based Strategy, LLC in 2007 to help clients harness the power of mobile . He is also running sales for for mobile commerce solution provider Unbound Commerce. Contact him today to learn more.

What’s The Big Deal: Facebook Deals

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Wilson Kerr (@WLLK) is a former Tele Atlas exec and started Location Based Strategy, LLC in 2007 to help clients harness the power of location-based social media marketing. Contact him today to learn more.

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Not so long ago, in a Harvard dorm room not so far away, Facebook was born. In record time, Facebook has graduated to the big time.

Today’s announcement of Facebook Deals is very significant, as it shows Facebook is looking beyond contextual advertising and toward the power of mobile “social experiences” to drive purchases and tracked point of sale interaction. Fueled by special deals offered by the legions of businesses who already use Facebook as their primary social media engagement platform, Facebook Deals tips their m-Commerce strategy hand and, as such, is a big deal.

Beyond Advertising

While college students certainly still use Facebook, it seems a broader audience that includes 500 million active users also see the appeal. Facebook has capitalized on this user traffic to the tune of an estimated $600M in contextual advertising last year. This is small beans compared to the close to $30 Billion in annual revenue Google is generating, 97% of which comes from advertising.

While this gap between Facebook and Google is one indicator the size of the advertising opportunity in front of Facebook, they also have the unique ability to capitalize on something perhaps even bigger, by driving tracked proven m-Commerce revenue linked to a specific location-based marketing campaign for small businesses and large brands alike. Google has been trying to back itself into this powerful social interaction value proposition but, to-date, has failed.

200 Million people now access their Facebook accounts via mobile. If Facebook can provide a secure, customizable revenue engine, reporting dashboard, and accounting system that users and businesses both trust, they could be in a unique position to capitalize as m-Commerce finally emerges from uncertainty and takes center stage.

Facebook Well-Positioned With SMBs

The rapid adoption of Facebook by consumers and businesses alike has changed the very nature of marketing. The new two-way street norm of required engagement with consumers has evened the playing field between small and large brands – and has fueled Facebook’s growth and popularity via an ever-increasing stream of relevant content at the same time.

As location-enabled smartphone user ranks swell, connectivity issues improve, and data costs fall, Facebook hopes the day is not far off when all businesses will need a live dashboard that controls a branded mobile Facebook page. This could become more important than having a “standard” website. For many, it already is.

The Check-In Craze: Watching And Learning

As the Foursquare and Gowalla-lead “Check-In” LBS craze swept in last year, Facebook watched and waited. User numbers climbed even without an LBS play and advertisers lined up. Facebook watched and waited, and learned.

When Facebook finally launched check-ins via Facebook Places “way back” in August of 2010 and embraced the unique location-awareness capability of mobile, it was a sparse affair that simply answered the Foursquare and Gowalla challenge. Even if basic, checking in directly on Facebook sped up the process by cutting out the middle man, since Foursquare and Gowalla piggybacked on the users Facebook graph.

Lately and perhaps not coincidentally, the initial novelty of “checking in” via a function-specific platform/app like Foursquare and Gowalla has waned. Even though each company is adding functionality as fast as possible, they simply do not have the local reach to add real consumer rewards fast enough to please most of the people most of the time. Facebook, if nothing else, has this reach, and this add to the power of the timing of the launch of Facebook Deals (yesterday).

Tapping The Power Of The Private Sale

Another location-based force that has rapidly re-shaped consumer interaction with products and services is the “private sale” phenomenon. While it’s long been accepted that consumers will act based on opinions from a trusted network of peers, there are finally ways these actions to translate into real, tracked mobile sales that have the tangible and impactful side benefit of driving live bodies into a retail point of sale.

In the last 6 months, “private sale personalized shopping” companies like Groupon, Living Social, and RueLaLa have been printing money by tapping into the desire for small and mid-sized businesses to drive new customers into their storefronts by offering special loss-leader deals via mobile.

It is interesting to note that CEO Mark Zuckerberg focused in on the “if you get three friends to check-in with you, you get something free” element yesterday. If you use Living Social, you know that this exact model provides the viral, turbo-charged boost they use to spread their deals among the interlocking social graphs of their subscribers.

I heard recently that Groupon is only able to process 1 in 7 deals proposed to them by small  businesses and is generating an estimated $50 Million a month in revenue. Worth an estimated $1.3 Billion while taking in only 135 Million in funding, Groupon is proof that small businesses will share a generous portion of the incremental gross sales, in order to have a shot at winning over new potential long-term customers that they know came in and redeemed the loss-leader offer. If this $50M a month figure is accurate, by the way, it means that the Chicago start-up is roughly matching behemoth Facebook in annual revenue.

Again Facebook has watched and waited, as (literally) hundreds of “daily deals for you” copycat (and well-funded) companies have sprung up and, as such, have proved the viability of the “opt-in daily deal” model on a massive scale.

Since almost 70% of US businesses have a Facebook page right now, Facebook could blow past these”check in for a personalized deal” companies that all must compete with each other and sell-in their solution to one small business at a time (or, more importantly, one giant brand’s “gatekeeper” agency at a time). The latter, in my opinion, is the harder row to hoe.

Into The Path Of The M-Commerce Parade

M-Commerce is a hot topic and, finally, there are real metrics to back up the years of wild expectations and predictions. With Deals, Facebook has stepped off the sidewalk and jumped out into the middle of the street, just as the location-based “special offer” m-commerce parade is poised to sweep over them.

These “daily offers” are nothing more than a new, location-based (mobile) way to promote the same tried and true “chalkboard” restaurant/bar specials or “sale bin” store items you see every day. The difference is that they are discoverable, BEFORE you enter the location/point of sale, when a consumer is in actual real-time physical proximity to that same location and have volunteered their location to the platform that is displaying the deal.

Think mobile is not ready to handle for the volume of potential commerce? eBay will more than double m-Commerce this year, from $600M last year to an-expected 1.5 Billion in 2010.

With the launch of Deals, Facebook is now playing in this hot space and can offer richer and richer solutions for businesses and consumers alike that can scale very quickly. They can capitalize on what has worked for other players with far-less reach that have conveniently prepped the landing zone before them, and avoid what has not.

A Single Solution?

By positioning the mobile Facebook app as the “login” solution that can also serve as an authentication engine, Facebook hints at their intent to solve the problem of “app option overload” for consumers and the “financial backside fragmentation” issue that has long-plagued the e-Commerce world. These elements will be especially interesting to watch.

While consumers do not all enjoy having to open a different app every time they walk into a business, the more important reason Facebook is poised to solidify the opportunity like no other is due to the fact that small town small businesses are generally already familiar with managing the backside page interface. Again, a whopping 70% have a Facebook page.

With so many social media options that may or may not include a customizable LBS m-Commerce element, big national brands (and their agencies) are also seeking a single solution. If Facebook simply can add the “check-in” and related special offers and m-commerce redemption tools they need to what they already provide, the barrier to entry becomes very small across all adoption fronts.

What’s The Big Deal

If mobile Facebook users can act upon a proprietor’s customizable call to action  by being directed to the location near them, debit an account on the same mobile platform that showed them the offer, and link it to trusted input from their social graph, Facebook will be linking the power of social marketing and m-commerce.

If Facebook can prove that consumers will not react adversely to special offers being “pushed” toward them when they are out and about, based on actual location and other algorithmically calculated variables like time, weather, and past behavior, well that would be something.

What if they could prove that consumers will volunteer “personal preference profiles” including what brands they like most, in exchange for real savings linked to location-based local or regional deals personalized for them? Not so far-fetched.

With m-commerce predicted to explode from $1.9 Billion in 2009 to almost $24 Billion by 2015 (see above), Facebook Deals might be just the beginning for the social network. Yes, Facebook Deals is a big deal.

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Wilson Kerr (@WLLK) is a former Tele Atlas exec and started Location Based Strategy, LLC in 2007 to help clients harness the power of location-based social media marketing. Contact him today to learn more.

Mad Men: Are Agencies Helping Or Hurting Mobile?

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Wilson Kerr (@WLLK) is a former Tele Atlas exec and started Location Based Strategy, LLC in 2007 to help clients harness the power of location. Contact him today to learn more.

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Last Monday, I attended an event at MIT in Boston. It was a standard panel-style presentation/discussion, with a moderator, sponsored by Nokia (thanks for the turkey wraps and little red gourmet cupcakes). It “sold out” in advance and I’d guess at least 200 people were there. It was, literally, standing room only.

Are Today's Agencies Enbracing Mobile?

Billed by organizers (Mobile Monday Boston) as a way for attendees to “learn the realities of mobile advertising”, the panel was stacked with ad agency people. Many attendees I spoke with saw this as a rare opportunity to hear directly from ad agencies, regarding their mobile plans. A finger on the pulse of those paying for the upkeep of the mobile heartbeat.  After all, if these agencies have the ear of the brands, then knowing their mindset regarding tomorrow’s mobile spend is very important, as the collective “Mobile Industry” springing up around all this “potential” needs to get paid today.

The Year of Mobile, Every Year

With the general mobile advertising outlook over-ripe from 3 years of unrealized, predicted mobile spending ramp-up, this night had the potential to shed some real light on the future of mobile marketing, and, perhaps, the fate of many of the companies represented in the audience. With livelihoods literally depending on brands spending real money via the mobile marketing tools many in the audience had invested so much time and money in, it is little wonder the event sold out in advance.

The Auditorium Fills Up! It Was Standing Room Only.

The predictions about the mobile ad spend have been recently correcting downward, as most brands idle on the sidelines, in a wait and see mode regarding mobile. Many dabble in mobile banner ads, a few skin up and launch product-related iPhone apps, and most have plugged into the free social media machine. But the big money is still not flowing and there is a backlog of companies waiting for the faucet to be turned on.

Are Agencies Paving The Way Or Blocking Progress?

Disclaimer: I have long-suspected large agencies of stunting the potential of mobile marketing because they fear that tracking and reporting real results regarding converted sales could shine unwanted light on all the untracked bread-and-butter mass broadcast marketing they run via traditional media. So, this night I came prepared to have my mind changed and I really expected to see and hear the excitement agencies were passing along to their clients. Why else would they have signed up for this panel? I was ready to be convinced that my conspiratorial theories were wrong (or at least have my mind set at ease).

To set the stage, here is the actual verbiage used to promote the event:

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The Realities of Mobile Advertising

Mobile advertising is getting a lot of hype, but what are brands really doing in mobile today?  What should we expect in 2011?  Our panel will discuss the realities and answer questions like:

• How big is mobile brand advertising?
• How does mobile fit into the big picture for most brands?
• What are the hot issues for brands? Targeting? Buying? Ad formats? Measurement?
• How has Apple’s promotion of iAd changed the market?
• What are the opportunities for publishers and app developers?

Speakers:

Adam Towvim, Jumptap (Moderator), Brett Leary: VP/Dir of Mobile Marketing at DIGITAS, William Nann: Director, National Advertising Sales at Crisp, Brenna Hanly: Mobile Catalyst at Mullen, Jon Phenix: VP Sales, Nexage, and Stephen Bagdasarian: Digital Strategist & Mobile Specialist, Hill Holliday Advertising

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This was a who’s who of Boston Ad Agencies and the purpose was to have them explain their individual or collective “realities” right there, live and in front of a room of mobile industry “insiders”. Kudos to Mobile Monday Boston for putting this together, by the way.

Sponsor Nokia Kicks Off

Sponsor Nokia opened the evening with a slideshow overview of their plans to re-take a share of the booming US smartphone marketshare they let slide by. They announced a $10 Million dollar developer contest designed to lure apple-addicted code writers their way.

The slideshow touted their global marketshare and reminded us all of the gazillion Nokia phones they sell. Despite impressions here in the US (caused largely by iPhone mania), they are a real powerhouse elsewhere. The new N8 just launched in the US and the Nokia team even had a fishbowl full of business cards collected, for the purpose of handing out two new phones at the end of the night to two lucky winners. Nothing turns heads like free phones as schwag. They even branded the nametags at the conference, making it look like 200 Nokia employees were in the audience. First time I have ever seen a logo on a nametag. Pretty smart, actually.

The guy next to me took notes about all this on his iPad, and even snapped a few pics on his iPhone, as did I. Nokia is well-positioned to make some moves and has a track record a mile long but, in the US, they have a long way to go.

Patterns Emerge

Top Boston Ad Agencies Address Mobile

Jumptap’s Adam Towvim was the moderator and did a good job all night. He kept the panel moving and asked the right questions. As the conversation flowed along, some clear patterns  emerged.

The first was that fragmentation was generally viewed as a big problem in the mobile landscape and that it negatively impacted the ability of agencies to convey a concise strategy to their clients.

The second was that ad serving consolidation was needed to increase efficiencies, reduce redundancy, and allow the agencies to better know WHO was actually seeing the mobile ads and better-measure engagement, across all platforms. A tall order.

The various kinds of phones (feature phones vs smart phones vs “candy bar” phones) were mentioned as an additional challenge.  Ad exchanges and buyside technology plays (to aggregate various ad servers) were also mentioned as welcome tools.

Sponsoring or branding iPhone applications was discussed as a way that brands could get involved, but it was noted (and generally agreed) that few agencies were adequately staffed up for  this.

Brenna, the representative from Mullen mentioned that she worked on a crowded creative floor and only-recently heard mobile advertising even mentioned. She offered that only because the team had been shown a presentation on the potential of iAd had the topic even come up.

iAd was generally seen as a positive platform for creative to be conveyed on both mobile and on tablets, but soon the conversation shifted to the fact that Apple was wielding too big a big control stick and some brands were bailing out (IE Adidas).

The discussion was fairly interesting (and fair) but not very exciting. The focus seemed to be more about “glass is half empty” what-can’t-we-do problems with mobile reach and fragmentation. Branding apps and creative rich media used in addition to mobile banner ads were lightly touched on as positive. There was little “let’s dive in” energy and only a smattering of carefully worded cautious optimism. All evening, I had the nagging feeling that something was missing…what was it?

What Was Not Said

The time was 8:15 and the panel had been on stage for over an hour when, finally, it happened! Brett Leary from Digitas was talking about the potential of the iAd platform, when he mentioned LOCATION. Yes, that little teeny detail about mobile marketing was not mentioned for the first hour+ of the discussion.

As if startled awake, Steve Bagdasarian from Hill Holiday picked up the ball and ran with it, nailing  several important factors one after another that only mobile advertising can offer brands. He spoke of “marketing to context” and how mobile allows even a small campaign to yield very large results and learnings. He spoke of “completing the user experience cycle” and how the “where factor” adds a powerful new element for brands.

Finally, just as it seemed things might heat up and the true power of mobile fleshed out, the moderated session ended, and the floor was opened to audience questions.

A Murmur Of Energy

Astounded that it had taken until nearly the end of the evening for the fact that most mobile devices know where they are and can deliver contextually-relevant messaging to come up, I raised my hand and was called on first. I asked about Mobile Proof Of Presence and “checkin” transactions linked to marketing messages. I asked for each panelist to comment further and expand on the potential they saw regarding Location as a mobile differentiator.  A murmur of energy swept through the crowd.

Again, Steve Bagdasarian from Hill Holiday lead the way. He was genuinely fired up and called mobile Location Based Services (LBS) “the future”. Steve described standard banner ad click-though measurement as “not suitable” for mobile and even tied in brick and mortar “here and now” campaigns as key. He even mentioned New England-beloved Dunkin Donuts as a willing participant in some tests his agency was running.

Will Nann from Crisp jumped in and added that he thought measurement was key and Brenna from Mullen asserted that “time and place marketing” and “learned purchase behaviors” would be very important. Yes!

Brett from Digitas (remember, he first used the “L” word), asserted that mobile could “use all the elements” and would emerge as powerful, as long as tracking could work across all platforms.

Another question was asked and the discussion spun off into tablets, Nokia hurriedly handed out two new N8 smartphones via the business card drawing, and the program ended.

Conclusions: Agencies Remain Cautious

It was an interesting event, don’t get me wrong, but I was left with the distinct impression that, even when confronted with a room full of mobile industry insiders clamoring for evidence of some optimism, agencies remain cautious and, unless prodded, will not push mobile on their clients, at least until reach is better understood and confusion caused by fragmentation reduced. This implied “all or nothing” trigger point felt, to me, more like a convenient excuse, than a real client-side-generated requirement.

Hill Holiday stood out as the most-willing to “go for it” and the resulting impression was not, at least to me, one of foolhardiness. It was, in fact, the opposite.

Test Small, Learn Big: What Can Be Done

To get ahead, in my opinion, agencies need to embrace the idea of “test small, learn big” and those out there with solutions for forward-thinking brands should describe them to the brand’s agency of record as a low-risk  trial. Or they should pull the “end around” and find a cheerleader at the brand to demand that the agency address the measurable mobile opportunity with, at least, a small foray.

Mobile solutions that offer low-risk pilots and can generate demonstrated revenue lift (without causing confusion) will open the doors to more and will win early. Dashboards that allow the agencies to view/understand metrics, own them, and pass these on to their clients/brands are essential, as the agencies need to made to feel they are in charge of the results and pass them on at their pace, in synergy with other non-mobile campaign results. Agencies that bring these platforms to their brands will be seen as innovators, but the platforms must first win over the agency and be prepared to let them be seen as the winners.

Even if on a small (initial) scale, trials of these mobile marketing tools can show the brand real numbers and label the agency as forward thinking and not afraid of mobile, even during this “fuzzy front end”. The time is now and those with numbers generated over time (even if small now, on a user percentage basis) will be well-positioned to win when the user numbers catch up. The brands whose agencies push this strategy now, will beat their competitors whose agencies fail to act boldly and try some of these new, exciting tools.

Just DO It (and log the metrics)

Doing versus talking about all the reasons not to do is essential, especially in the face of mounting evidence that mobile usage and search is taking off, while at-home desktop search is falling (+247% vs -15%). While the percentages of those who engage with branded businesses via the location-enablement of their phones are still small, this opportunity to learn is big. If a consumer is out and about and searching for something, brands need to be ready to show them WHERE to locate that item and buy it, right then, in that crucial mobile-only moment. And their agencies should be telling them the best way to do it.

Are the agencies hurting mobile? I think the answer is no, but they certainly can do more to encourage trials and not link mobile marketing to unrealistic requirements like 100% defragmentation and total, complete reach, with uniform tracking across every device or platform.

Agencies also need to take the time to educate their employees on the basics of mobile marketing and LBS. This is crucial. It was clear to me that some top people at the agencies represented at this event were not fully versed in how these tools really work and the potential value of the metrics that can be generated. They need to educate themselves.

The Shotgun AND The Rifle

Most of all, in my opinion, agencies must discard the notion that mobile campaigns that provide tracking dashboards and ways to demonstrate ROI will expose the inadequacies of the other more standard media buys that do not. There will always be a place for the shotgun approach in marketing. Mobile, using the power of location, is the highly accurate rifle shot.

Where Can I Buy These Cupcakes? They Were Awesome!

All in all, it was a good evening. I was relieved that the topic of location and the unique differentiating abilities of mobile platforms was discussed, even if it was tacked on at the end of the evening and initiated by an audience question. Clearly, we in the industry need to make it easier for agencies to focus on the full half of the glass, but agencies also need to put aside the convenient excuse that they will only let their brands dive in when every single element of mobile marketing is known and understood.

As the Mad Men TV show teaches us, the basic premise of advertising has been around for a long time. Mobile, on the other hand, offers us new and different and untested potential and there is a degree of “try it” needed if brands are to be exposed to the full potential of tracking incremental sales tied to specific mobile campaigns.

Thanks again Mobile Monday for the event and to Nokia for sponsoring it. By the way, where did you get those little red velvet gourmet cupcakes? I wish I could use my phone to find the brand that makes them and then navigate to the authorized retailer near me right now that sell them. I wish the agency that handles their media would call me and hire me to help. Wouldn’t that be sweet!

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Wilson Kerr (@WLLK) is a former Tele Atlas exec and started Location Based Strategy, LLC in 2007 to help clients harness the power of location. Contact him today to learn more.