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Within reach: The ultimate guide to mobile proximity marketing for retailers

Within reach: The ultimate guide to mobile proximity marketing for retailers

Mobile proximity marketing is a powerful way to share messages with consumers as they’re in the mindset to make a purchase. These strategies leverage the consumer’s location to provide messages based on deals in their area, which can drive interest and encourage product interaction. The technology needed for this varies, but often, it’s much more affordable and easier to implement than most retailers realize.

Most major retailers already use some form of proximity marketing, whether they’re offering rewards through beacon-based programs or the ability to interact with displays via RFID embedded chips. Using a combination of mobile proximity marketing strategies sets retailers up for the best results through flexibility. It helps regardless of whether retailers want to guide consumers to specific products, better understand buying behaviors, or maximize their sales.

Types of Mobile Proximity Marketing Systems

Mobile proximity marketing is a very general term that can refer to many different strategies. The type of technology involved, messages sent, and other features can also vary. Here is a breakdown of the four types of mobile proximity marketing systems that brands may choose to leverage.  

Type Pros Cons
Bluetooth

The system requires a Bluetooth broadcaster, as well as a cell phone with Bluetooth enabled to transmit content, data, and images.

  • Works with a wide range of cell phone types and screen sizes
  • Is independent of the location’s existing IT infrastructure
  • Is mostly affordable, as broadcasting depends on small, low-cost beacons
  • Many consumers default to turning off Bluetooth due to concerns over battery life or security.
  • ROI calculations are challenging, as it’s difficult to tell what messages drive the most sales until after the campaign.
Near Field Communication

NFC uses RFID chip embedded tags to enable communications between the tag and the devices that come in very close proximity with it. NFC’s most common use is in simplifying payments for the consumer, but can work with marketing as well.  

  • Leverages “pull” marketing, in that the consumer chooses to interact with the tag using their phone to discover more information
  • Works with tags and consumer cell phones alone, meaning retailers do not have to incorporate anything into their existing IOT infrastructure
  • NFC can be expensive to implement, and it can be difficult to determine the overall ROI.
  • Not all smartphones are NFC-enabled, meaning that retailers could miss many opportunities to reach the consumer.
  • It’s typically a “single-use” strategy designed to perform one action or deliver a single message.  
WiFi

WiFi-based systems are very similar to Bluetooth systems, in how messages are transmitted and received. But that information travels over general WiFi, rather than relying on low-energy Bluetooth.

  • The main benefit of WiFi is data. It can gather information based on the electronic devices it connects with and follows through the store so that retailers can get a better idea of foot traffic flow and consumer shopping behaviors.
  • It can reach a wide range of devices as it detects signals emitted from both Bluetooth- and WiFi-enabled devices.
  • It typically works throughout an entire location with WiFi and for a short-range outside.  
  • This type of system needs far more equipment than simple Bluetooth beacons and requires incorporation into the location’s existing IT infrastructure.
  • Push notifications can be disruptive to consumers, and cause them to turn off phone WiFi to avoid them.
  • If store WiFi goes down, the system goes down with it and can result in a loss of valuable data.  
Geofencing

This system allows messages to reach users in a specific, geographical area.

  • Geofencing can work when a consumer is near a store, rather than simply inside it, which encourages them to enter in the first place.
  • Geofencing can provide real-time analytics of consumer traffic flow through the store.
  • It is not a standalone process and must be used with another method of mobile proximity marketing to work effectively.
  • Geofencing parameters may be too broad for a business’ needs.

Retailers rarely choose one single form of mobile proximity marketing. In most cases, they leverage several, and many of these systems complement each other well.

Best Practices in Mobile Proximity Marketing

Mobile proximity marketing is powerful because it allows brands to reach consumers during crucial shopping moments. It can also reinforce brand affinity and prime consumers for sale throughout their purchase journey. When embarking on a mobile marketing campaign, retailers and brands should:

Be specific

Mobile proximity marketing is designed to drive interest in products based on their availability nearby. As such, messages should center on deals available by location or on certain items, rather than just standard marketing messages. This drives individuals to seek out these specific products, which can increase sales. Generic marketing messages are less impactful as they don’t encourage a consumer to take a specific action, which is a crucial part of mobile marketing.

Gamify the program

Gamification—or the process of turning a mundane event into a fun activity—is a great method for driving engagement with products. Allowing consumers to use their phones to discover the hidden features of an advertisement or seek out products in the store can increase the likelihood that they will continue to use the app. This means brands can gain more attention for their advertising as well as a longer retention rate for the app.

Incentivize interaction

A major part of gamification is the reward for participation. There must be something that marks the consumer’s accomplishment as they participate. This is where mobile reward programs can provide an opportunity. Consumers in these programs can collect points that they can save and redeem for branded merchandise, gift cards, and more. These incentives provide the added benefit of creating a sense of product value without the need to offer a discount.

Leverage mobile video

Mobile video is the most engaging medium for shoppers. Users of mobile are three times more likely to view a video when shopping than desktop or laptop users. Brands should look to incorporate video which can be viewed seamlessly within an app, or in other words, vertical video. Video in this format allows consumers to view video content without changing their phone’s position, making it ideal while consumers are shopping or on-the-go.

Use multiple programs

As many mobile proximity marketing campaigns require user permission, it’s critical that retailers and brands take advantage of as many as possible. A mobile phone user may have their Bluetooth disabled, but are still likely to have their WiFi enabled. By using multiple proximity-based strategies, brands can gain the attention of a larger audience.

Mobile proximity marketing is a particularly strong opportunity for brands in highly competitive categories. This is especially true for those in the cosmetics industry, like Rimmel London. When Rimmel wanted to gain greater attention in the shopping aisle, the beauty brand chose to partner with Shopkick to reach its active audience. They set up a campaign which included proximity messaging that offered pre-shopping advertising to familiarize consumers with products before and during the shopping journey. Then, they rolled out options in-store where consumers could seek out specific products, scan UPCs, and receive kicks for participating. By contacting Shopkick, Rimmel London managed to pull 14% of the market share from competitors and saw a 5:1 ROI.

Of course, brands can only enjoy these benefits if they choose to partner with the right mobile app providers. That means reviewing a few key metrics and options of all available programs to garner the best results.

Selecting a Mobile Proximity Marketing Partner

Retailers and brands have the option to create proprietary apps. However, there are limitations to these features, one being the audience. If a consumer is already following a retailer or brand, it’s likely because they’re already loyal. While rewarding pre-existing loyalty is wise, it doesn’t serve to grow the brand or retailer’s audience. Companies must supplement their proprietary programs with third-party app providers to reach new users.

Third-party app providers help companies reach new audiences who may not have considered their products before. They also take the expense out of a mobile app program as these providers handle the development, app retention, marketing, and innovations that drive consumer use. Before partnering with a third-party app, brands should take into account the app provider’s:  

Reputation:

Companies will share the reputation of any app provider with whom they partner. As a result, they must ensure the reputation of these apps is above reproach, in that they use consumer information fairly and correctly and provide strong security.

Active users:

Companies may focus on apps with a high number of downloads as well as retention rates, but often, consumers will download an app never to use it again. Active user metrics allow companies to better understand how much activity that app gains from its user base.

Features:

Companies should partner with apps that offer features consumers want the most. The ability to gain rewards and enjoy exclusive content are major drivers of an app's success. Also, features like rewarded video—where consumers receive an incentive for viewing content to the end—appeals to consumers as it allows them to gain something in exchange for a minimal time investment.

Prior campaign success:

App providers should be able to show a history of success for brands within a niche. They should offer clear figures relating to return on investment, sales lift, and market share growth as just a few examples. Metrics of prior campaigns allow brands to see the kind of results they can expect from a mobile app campaign with that provider.

User demographics:

Brands and retailers want to be able to reach household decision-makers, but they also want those decision-makers to be the prime audience for their products. Partnering with an app with a diverse mix of users allows brands to target the best possible sales prospects to create a successful campaign.

It’s important to target a wide range of mediums such as apps that provide rewards, voice interaction, and augmented reality. Multiple partnerships make it easier to cost-effectively take advantage of innovations in mobile technology.

Retailers and brands should consider offering their own mobile proximity marketing programs, but also supplement those programs with third-party apps that provide additional features. This strategy allows brands to provide the widest range of services while engaging a broad audience of consumers in the shopping aisle.

Shopkick assists our partners in their mobile proximity marketing campaigns by providing an intuitive app with an active user base where they can advertise their products and reach out to traveling consumers. To see some of our past results, review our success stories.