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In The News
Making a Business Case for Mobile Marketing

April 13,2010

Published by Chief Marketer
Written by Bryce Marshall


Mobile marketing creates opportunities for timely and intimate consumer experiences, but is often poorly understood. And unlike online tactics like search, email, and social marketing, few brands have dollars set aside for mobile development, meaning business cases and ROI models must be cemented upfront. The good news is consumers are already mobile. Hundreds of millions of North American consumers are engaged with their mobile devices.

Many marketers are overwhelmed by the technologies and terminology that fall under "mobile." However, the foundational components of mobile marketing are straightforward, support core marketing and communications programs, and deliver clear and measurable outcomes.

Here are a few tips for making a mobile business case:

The Foundation

1. Text Messaging (SMS)
There are more than 300 million mobile subscribers in North America, representing approximately 90% of all adults. Virtually every mobile device supports SMS. Studies indicate day-to-day use of SMS has quickly migrated into older age groups, with as much as 50% penetration among boomers. After voice, SMS is the most ubiquitous mobile technology. Any ROI metric looks better when the potential audience is 300 million consumers.

2. E-mail and Social Media
The number of consumers with feature phones or smartphones accessing personal or business e-mail accounts, and monitoring Facebook statuses and tweets, is growing quickly. E-mail and social media must be understood as components of mobile marketing. Considering how engrained e-mail and social media are within online marketing, the incremental costs to adjust for mobile-friendly content delivery should be very tolerable and seen as the lowest hanging fruit

3. Mobile Web
Twenty percent of mobile subscribers have both the device and data plan needed to access the mobile Web. The small number of subscribers with the ability to access the mobile Web creates challenging ROI metrics. The potential audience diminishes while development and infrastructure costs increase. The mobile Web, however, is vital to more interactive experiences and provides access to greater information on-demand, all while supporting SMS and mobile e-mail tactics. The mobile Web is a lynchpin of effective mobile marketing.

4. Device-specific apps
Many marketers envy the buzz around other brands' iPhone apps. But marketers looking to create apps must be cautious. The ROI of apps is inherently challenging. Among the 20% of all mobile subscribers with smartphones, only a fraction own iPhones. To deliver meaningful app experiences to all smartphone users, marketers must create several apps (Android, Blackberry, Symbian and Palm) and make a large investment. Marketers that focus on iPhone users only rely on a small relative audience of potential consumers to balance their investment.

5. Mobile Advertising
Paid search and banner advertising are growing mobile marketplaces. It is necessary to understand the potential audience is those with mobile Web access. In contrast to traditional online search, mobile search is implicitly urgent. The consumer is ready to take action; they need information and direction now. Mobile search ads can include results for local stores, access to driving directions, or a simple click-to-call to convert interest into a sale.

The Examples

1. Customer service, care and support
The business objective is to replace high-cost, reactive customer service experiences with lower-cost, more proactive experiences. Examples include extending online assets and automated services to mobile devices for maximum cost efficiency and on-demand access.

The broad reach and low operational cost of SMS provides a logical starting point for proving ROI. SMS programs can tap into back-end business systems or Web applications to make important information available on-demand, or through automated notifications. Examples include account balances, shipping status, appointment reminders, store locations, and more.

Mobile web sites are ideal for providing consumers with self-help services like FAQs or help tickets. Apps are suited to high-value experiences such as live chat or intelligent automated response programs.

2. Acquisition, sales, and purchase influence
Mobile users demonstrate shorter buying cycles. They want actionable content like reviews, discounts and directions now. For mobile users, convenience trumps all. Deliver actionable content and convenience, and revenue will follow.

SMS and mobile search are good starting points. The two tactics are well suited for driving foot traffic with precise timing of scheduled messaging (SMS) or relevant, location-based lead-generation (mobile search).

Mobile Web content can add more interactive substance necessary for some purchase decisions. For instance, existing online content like product reviews, feature highlights, or promotional videos can be re-purposed for mobile access to shoppers in store. The content can influence purchase decisions for large ticket items, technology, and fashion goods, or help fill a larger cart. Device-specific app investments are more costly, but support robust mCommerce, making a new line item in the channel revenue reports.

3. Branding is perception and experience
Mobile devices are relatively small, but mobile experiences can have a huge impact on consumer brand perception. Why? Consumers appreciate valuable, relevant content delivered when and where it is most needed. Leave the consumer saying "that was easy," "that was helpful," or "that was convenient" and the brand experience is held in high esteem. Valuable mobile experiences become addictive, and the foundation of brand loyalty and advocacy.

The Math

Budgets for mobile marketing are elusive. How can marketers get started? Attack the opportunities that, by the math, are best suited to deliver positive ROI.

1. Invest in foundational mobile components first such as SMS, e-mail, and select mobile Web experiences
2. Identify the low-hanging fruit in consumer use cases that best map to business objectives
3. Convert initial wins into investment capital, funding more sophisticated solutions and creative exploration

Bryce Marshall is the Director of Strategic Services for Knotice. Bryce works with new and existing clients to define strategies and plans for more powerful and profitable application of direct digital marketing programs. Contact Bryce at bmarshall@knotice.com. For more information about Knotice visit www.knotice.com or their blog http://lunchpail.knotice.com.


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