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Go Mobile To Boost Sales

[ 0 ] Mar. 25, 2013 | SBO Editor

By Alan Chung

According to the January report from the National Federation of Independent Business, economic optimism among small business owners is at a near record low.  But innovative mobile marketing solutions are helping merchants boost sales and confidence levels.

Research shows that mobile marketing is now far more effective than traditional marketing tactics.  Businesses have the ability to send messages directly to customer devices via push notifications and SMS.  These messages get read by 97% of recipients, on average, compared to the 4% of people who open promotional email messages. And mobile coupons get redeemed 5-20% of the time, compared to just 1% for paper alternatives.

Mobile technology has also changed the landscape of customer loyalty programs.  Instead of passé paper punch and plastic cards, mobile platforms offer small businesses a dynamic way to engage customers and drive sales.  A University of Chicago study found that customers accelerate their purchase frequency by 20% when they’re close to earning a reward, and they buy 20% more product in less time when motivated by a reward. Mobile apps help consumers track their loyalty status in real-time, which is key to creating customer motivation.  According to an ACI Worldwide survey, 78% of loyalty members say that easy access to membership and reward information would increase their desire to shop at a store.

As a case in point, JazzKats Coffee Bar in Portland, Oregon, launched a mobile loyalty program via smartphones in 2011.  It allowed the business to offer multiple incentive programs simultaneously and because customers could easily see how close they were to earning a reward, visit frequency improved from once every nine days to once every four days.  And customers that participated in all three programs generated five times more monthly revenue than customers in one program.

Added business value

In addition to driving sales, mobile loyalty provides small businesses with:

Customer insight. Most mobile programs synch purchasing data into a web-based merchant portal.  This allows business owners to view program analytics that illustrate store activity, summarize customer behavior and display private customer feedback. Not only can this information help merchants assess their program ROI, it is essential for providing tailored and meaningful rewards that keep customers coming back.

Flexibility. Not all businesses fit the “buy 10 get one free” model of traditional loyalty programs.  Depending on the specific needs of the business, mobile-based loyalty programs can utilize points, punches or a combination of both.  Merchants can choose whether customers earn rewards by purchasing a designated number of items or based on actual dollars spent. Businesses can even create tiered perk programs that enable cross-promotion or deliver special treatment for the most valuable customers.  Newark Boost Mobile, for example, offers a bonus to VIP loyalty members by allowing them to earn rewards 20% faster than other members.  When a customer has earned enough points, they can cash them in for deals like 20% off an accessory or $5 off a monthly payment.

Advanced loyalty programs aren’t just for chain stores with big marketing budgets.  Mobile technology is affordable and loyalty programs can be implemented for a little as $50 a month.  With an uncertain economic forecast, mobile marketing is key for small businesses that want bigger profits in 2013.

About the Author

Alan Chung is CEO of Perka <http://getperka.com/> , a mobile loyalty program that helps small merchants and their regular customers support one another. The company’s unique system gives customers the satisfaction of being recognized with increasing tiers of perks, and in turn provides real, meaningful intelligence to merchants.  Perka is based in Portland, Oregon, and New York City.

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Category: Features