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Mobile Marketing – Winning the Transactional Customer Today

I remember the first time someone pitched me the idea of mobile marketing—sending texts out to customers to convince them to come into the store. Two things stood out from that meeting. First, they gave me a stat that said there were 4.5 billion smartphones in use on the planet. Second, they showed up just shortly after I had read Seth Godin say, “What if you actually won the race to the bottom? Worse yet, what if you finished second?”

They lost me with the first statistic because it was a blatant attempt to overplay the significance of the smartphone. 4.5 billion phones? Sure, maybe that many had been produced and even sold, but to believe that 64% of the 7 billion people living on this planet were on a smartphone was just a little over-the-top. I wasn’t ready to jump to the conclusion that even 64% of Americans had smartphones. My mom and dad were still using flip phones at that time. My younger son did, too. My older son had an iPhone, but I was still on my Blackberry, barely touching the “smart” part of that phone. In an upper middle-class, tech-savvy, American family, only 50% of us had a smartphone back then*.

(There is a quick marketing lesson here. If your statistics seem too good to be true, you better justify them or don’t use them at all. Any strain to your credibility will kill the rest of your message.)

Image result for mobile marketingThere was a second statistic they gave me (by the way, I would link to these statistics if I could, but I can’t find evidence online to support them) that said 51% of smartphone users responded to coupon offers sent directly to their phones.

That number actually made sense to me. You and I have already talked about the two types of customers—Transactional and Relational.

Here’s a quick recap to jog your memory … Transactional Customers know exactly what they want and are on a hunt to find the best price. Relational Customers are looking for an expert they can trust to help them find the right item. We are both Transactional and Relational, depending on the category and product. About half the buyers will be Transactional and half will be Relational in any category, too. But Relational Customers will be more profitable to you and have more loyalty.

The 51% who responded to deals and discounts on their phone are likely to be Transactional Customers. I tend to lean more Relational. It would drive me crazy to get bombarded with texts like that all day.

That’s the key to understanding Mobile Marketing. It is a Direct Marketing offer that is most likely to be seen and used by a Transactional Customer. It isn’t a tool for Branding. It isn’t a tool for building relationships. (Transactional Customers have no loyalty to anything other than the discount or deal.) It is merely a tool for attracting the least profitable customers out there.

That doesn’t mean Mobile Marketing doesn’t have a place in your advertising toolbox. It can be incredibly effective for specific uses.

If you do have a deal-of-the-day and want to let your Transactional Customers know about it to help you move some inventory, Mobile Marketing can work well for you. If you have a restaurant and want to highlight today’s specials, Mobile Marketing can work well for that, too.

If you’re just throwing out coupons to anyone walking by your door, however, you’ll get traffic, but it won’t be that profitable and won’t have any long-term positive effect. In some cases, you’ll just be throwing money away.

Would I, as a Relational Customer, use a coupon sent via text when I walked into a store? Of course! But that’s just lost profits. I was already going in to buy something and was already willing to pay full price.

As with every form of advertising, there are pros and cons. There are ways it works and ways it doesn’t. Mobile marketing is one of those that has a specific use. If you know who you’re trying to attract and why you’re trying to attract them, then you can pick the media best suited for the task.

-Phil Wrzesinski

PS *Even today I find it impossible to believe that 4.5 billion number (and by now I’m sure they are boasting some higher number). Some might argue that for every person not on a smartphone there is some guy on Wall Street who owns three phones. Okay, I get that. But do you want to pay to reach him three times?