With smartphone penetration reaching 77 percent, according to a recent comScore report, product and service providers, technology companies and startups are all battling for their pieces of the mobile pie. They are paying attention to the latest mobile marketing trends, from mobile wallets to location-based marketing.
Mobile Search Growing
Mobile search is growing quickly while desktop search is falling off. According to Kevin Buerger, executive vice president, managing director, U.S, for Jellyfish, mobile search now comprises 60 to 70 percent of search, with desktop dropping to less than half. People always have their smartphones with them, so they can search whenever it occurs to them, be it consumers looking for a place to eat, consumers "showrooming" while at a retail store, mobile workers looking up product or service specs or municipal workers searching when they see an opportunity.
"You see it across every industry," Buerger said, pointing to municipal executives using smartphones to search for and then order park benches, waste receptacles and other community needs, with mobile searches up strongly for both. "Mobile search is the beginning of the conversation."
Payment Buttons Come to Mobile Apps
Popular mobile apps like Facebook and Twitter are looking to add payment buttons to enable consumers to pay straight from the app rather than requiring them to go to another site to purchase a product or service. According to comScore, Facebook is the top app, with a 73.3 percent reach, followed by Facebook Messenger at 59.5 percent.
Amazon has such a feature, making it easy for people to find an item and pay for it without leaving the site, Buerger said. "It brings commerce to what people consider to be safe places, so they transact more."
With that in mind, Buerger said companies are better off working to boost their social media presence rather than spending resources developing their own apps, which "people tend to use once and then forget."
Location, Location, Location
Various companies are pursuing location-based marketing strategies, pushing out mobile ads to customers and prospects as they come within a defined proximity to a physical store location.
"Location-based marketing is the intersection of people, places and the media," said Asif Kahn, founder and president of the Location Based Marketing Association. The LBMA has worked with restaurants and Groupon to provide digital coupons when drivers come within a pre-determined distance of the establishments. These and other location-based offers play on the impatience of the typical consumer, according to Kahn.
Some businesses are starting to layer in different location-based data to refine their mobile marketing strategies, said Jeff Allyn, chief revenue officer at LocationSmart. Companies will typically examine such data closely to determine customer patterns in order to determine their most effective marketing strategies.
Some companies are using location-based marketing to target customers when they are at a competitor’s location, such as a furniture retailer sending a discount offer to a prospect when the person is at a competitor’s location.
Mobile Wallets Evolving
Mobile wallets are continuing to grow in number, but several experts predict a shakeout in the near future, with consumers opting for mobile wallets that can be used at multiple locations and that offer a combination of loyalty, rewards, gamification and geolocation features.
The most recent development was the launch of Android Pay in mid-September, a direct competitor to Apple Pay, which launched late last year. The issue with each is that they don’t work on the competitor’s devices, so Android users are limited to Android Pay and iPhone users are limited to Apple Pay.
Both are also limited to the relatively small number of point-of-sale terminals that accept them. When Apple Pay first launched, it could only be used at an estimated one million of some 20 million POS terminals. That number has grown as merchants update their POS devices to read chip-based cards to comply with new industry standards that shift the liability to merchants from card issuers. The new standards go into effect Oct. 1.
New POS terminals include the ability to accept Apple Pay and Android Pay, but merchants can elect to keep this feature turned off and eliminate the associated fees. Small merchants may choose to accept the fraud liability rather than incur the expense of upgrading. But the trend is toward a much wider adoption of mobile payments.
Jack Connors, Google head of commerce partnerships, expects mobile wallets to hit the tipping point in a couple of years.
Javelin Strategy & Research estimates there were $3.1 billion in mobile transactions in 2013, a figure that is expected to grow to $53.1 billion in 2019. Though the number is growing quickly, it still pales in comparison to the estimated $4 trillion in total transactions.
Phillip J. Britt's work has appeared on technology, financial services and business websites and publications including BAI, Telephony, Connected Planet, Independent Banker, insideARM.com, Bank Systems & Technology, Mobile Marketing & Technology, Loyalty 360, CRM Magazine, KM World and Information Today.