Webinar deck: Mobile Enabling Retail Marketing

Mobile Enabling Retail Marketing An overview of retail mobile marketing $1 off Ghirardelli concepts, strategies, tactics and Squares Gift Sets technologies with industry & iLoop Mobile Expires 10/25/10 case studies. Prepared by: Michael Ahearn, VP Strategic Marketing2221621217-2090-04 michael.ahearn@iloopmobile.com

About iLoop Mobile• Leading technology and services making it fast and easy to create, manage and analyze mobile McDonalds: Enjoy one marketing campaigns and content delivery FREE Small McCafe. initiatives worldwide Code 34d83w Exp.1/6/10 Help:mmcoupons.com Opt-out: Reply• Award winning iLoop Mobile Platform is a self- MCDONALD STOP service SaaS solution with open APIs for creating state-of-the-art SMS campaigns, mobile sites, mobile coupons, mobile-enabled Web sites and other mobile marketing initiatives• Industry leader in mobile marketing strategy, managed service campaign delivery and professional services• Customers include Fortune 500 brands, agencies, media companies, and other tier-one companies

Why Mobile Marketing for Retail?Marketing objectives mobile can achieve: • Customer acquisition with database build • Improved customer service • Generate retail and Web traffic • Promotional communications • Consumer awareness • Cross selling and up-selling • Customer loyalty and trust with brand • Lead generation and prospecting affinity • Increased interactivity with • Customer retention customers or audience • Viral marketing/word of mouth • Increased use of traditional & Web marketing channels • Product sales & content monetizationMobile is the most effective direct marketing that exists.

Shoppers: Requested In-Store Mobile CapabilitiesPlease rate how useful the different pieces of information wouldbe to you when you are shopping in a store (% very helpful)Feb 2010 Communispace In Store Mobile Experience Survey

In-store Mobile PromotionsEnticing call to action on in-store signage, shelftalkers and on the product itself Why Mobile for In-store • Reach interested customers • Immediate incentive to participate • Increase sales conversions • Ability to integrate with POS system • Customer loyalty programs • Customer info & service capabilities Call to Action Examples: • Text-to-Win sweepstakes • Text for a discount/coupons • Text for valued alerts • Text for VIP treatment • Text for in-store help • Product information Ace Hardware Aisle 411. In-store mobile service gives promo info and helps find products in the store via IVR and sends coupons and product promos via SMS.

Retail SMS Interactivity • Simplify food and wine pairings with in-store mobile “wine guide” • Text the desired food type, cuisine, specific dish or main ingredient to 411511 (ex. CASSOULET to 411511) • Data sent to food pairing database for reply SMS • 3 wine pairing choices are sent back via SMS • Helps shoppers with immediate advice, overcoming “wine choice overload” when dealing with store shelves • Promoted in retail stores with shelf talkers and neck hangers on product itself • Simple yet effective example of using SMS to achieve brand marketing objectives

Mobile Integrates With Other ChannelsMobile call to action can be integrated into ALL marketing channels

Mobile Enabled Point of SaleMobile is can provide customer service or execute sales

Mobile Incentive Marketing for Retail8

Basic SMS Promotional Messaging• Mandee used in-store signage in 119 stores to present the call to action to win a $500 shopping spree• Instantly redeemable mobile Print Opt-in coupon was also sent for 20% off MANDEE any single item purchased that day• Entry into the sweeps also offered opt-in to Mandee Mobile Alerts subscription for exclusive weekly SMS messages on events, promos, and special offers• Subscription opt-in is also available via Web form capturing customer profile data• Simple “show the message” redemption with trained in-store associates Web Opt-in

Scaled Deployment of SMS CampaignsDirect marketing programs for hundreds ofsmall businesses nationwide are reporting:• Average conversion rates 15-20% and as high as 30%• ROI as high as $20 return for every $1 spent• Increases in opt-in databases have reached 23%• At least 2x redemption rates as compared to other media channels• Fraction of the cost of the overall shared mail campaign–mobile easily pays for itself• Between 250-1,200 opt-ins in first few McDonalds Thanks You Enjoy one FREE Small months–one retailer had 900 in first two McCafe coffee. Valid 1 weeks week. Help: moneymailer.com• Spike sales during slow weekdays and Opt-out: Reply STOP on promotional holidays MCDONALD Msg&DataRatesMayApply.• Reported 4% increase in incremental sales

Multimedia Messaging (MMS)• Multimedia Messaging Service (MMS) is a rich media messaging service that allows mobile users to send and receive messages that can include graphics, animations, slide shows, photos, audio, video, and unlimited text (no 160 character SMS limit)• It can it provide marketers with increased ad effectiveness over SMS• Unlike the Mobile Web, this media resides on the user’s mobile phone• Today, available on most mobile phones but some handset/carrier support variations which may require WAP offload• MMA has established ad standards for MMS• So far, most US MMS ad campaigns in the US have been carrier-specific, but MMS marketing on an interoperable cross carrier short code is here

Mobile CRM & Segmented Messaging12

Customer Acquisition with CRM• Get more data than keyword based opt-in carrier metrics• Opt-in to mobile “coupon clubs” via online Web form or mobile site• User selectable coupon offers• All preference and profile data is captured for CRM database build, analysis, targeted messaging, and use in other marketing channels (email, print, direct marketing etc.)• Tell-a-friend viral component Web Opt-in Mobile Site Opt-in

SMS Dynamic Messaging & CRM Integration• Use CRM databases for dynamic messaging—insert names, use profile data and preferences to personalize messaging and create rule sets that increase relevance and conversion• Integrate mobile campaigns with Hello John, The San Message existing or external CRM databases, Francisco Macy’s components data feeds and content management stores have 20% off all sourced from Kenneth Cole shoes existing CRM systems and suits until Sunday. database and Txt STOP to stop.Txt dynamically HELP 4 help. Msg & integrated into• Integrate with your existing reporting Data Rates May Apply. the message systems—send data from the mobile platform to external reports and view reports in your reporting systems

Smart Messaging: Database Integration“Everyone receives the same offer” mobile promos orcoupons can have unknown relevance when delivered• Smart Messaging integrates with data sources such as news, weather, finance, CRM consumer profile, inventory etc. instantly adding relevance• Smart alerts can know: ! Who the customer is ! Where they are ! What’s happening around them The heat wave ! When they want something continues here in LA! ! Why they need or want it Cool off at lunch with an ice cold root beer Advantages to Smart Messaging: float, free with every Galaxy Meal purchase ! Personalization and point-of-need relevance at any AstroBurger increases participation location. Code:34ru3 ! Time and place relevance increases Exp: 7/12/10 participation ! Contextually relevant messaging increases acquisition, conversion and loyalty

Smart Messaging: User FlowText STORE + your zip code to 44264 toreceive a SMS coupon every month for SMS Only Coupon:20% off your favorite fashions Contextually relevant coupon is delivered based on keyword + It’s a scorcher in Miami database referencing Freezing in NY today? Database today! Keep cool with with Keep warm with with a unique redemption STORE + your breezy late summer code. sweater. 20% off wool zip code to 44264 Weather skirts. 20% off at any all sweaters at any store. Code t239r Exp. store. Code 34r39r Exp. Stock Market 10/31/11 10/31/11 Location Look Up Product Inventory Past Consumer Purchases Any Other Event or Data Sets Consumer Profile Data Contextually relevant coupon STORE + 10507 delivered based on keyword/ Sends coupon for sweaters zip referenced against based on cold weather Database receives weather database reading for opt-in zip code 62407 keyword opt-in and Store 33128 Here’s something By Weather delivers a coupon special for you to based on external celebrate your birthday. events or information Come into Dressbarn in the database and get 20% off any Miami item. Code f5mt Exp. 5/31/11 By Consumer Profile Data Messages sent based on stored customer profile data with Text opt-in for either single coupon unique redemption code. or to opt-in to couponing alert group

Mobile Coupon Redemption17

Couponing LandscapeThe Value of Couponing• 57% of consumers would not have bought an item if they didn’t have a coupon• The average amount spent is 77% more with coupon than without (study figures: $216 with, $122 without)• Customers are more likely to purchase from the retailer again if they use a coupon (91% with, 85% without) Source: Compete, Inc.Mobile coupons are one of the fastest growing, most effective and easy toimplement solutions available to marketers.• Segmented database build and targeted message delivery• Detailed customer transaction data capture• 10x redemption ratesSource: www.promotionalcodes.org.uk/15311/mobile-advertising-and-the-rise-of-coupons | www.fastcodesign.com Infographic of theDay by Tiffany Farrant (Borrell Associates Report, ComScore, Airwide Solutions, Compete, MarketingCharts.com, MySkyNet, JuniperResearch, MMA)

Mobile Couponing Value Proposition Mobile coupons can capture key customer transactional data using nothing more than a customer’s mobile phone number.• Easy-to-implement, affordable and effective marketing campaigns• Highly targetable, relevant messaging to diverse customer groups• Captures and leverages transactional data for new marketing offers and messaging $1 off Ghirardelli Squares Gift Sets Expires 10/25/10• Marketing campaigns are directly linked to top line revenue• Builds an ongoing, segmented customer database 2221621217-2090-04• Up-to-the-minute measurable results using advanced analytics• Access and add mobile redemption data to your RFM measurements to better influence customer index scoring and up-sell/cross-sell potential• Set the stage for improved customer segmentation, modeling and life time value measure—target and deliver the right offer based on past purchase data

Retail Objectives for Mobile Incentives & CouponsAchieve Your Marketing Objectives• Drive traffic to stores, Websites and events• Motivate purchase with easy to redeem discounts• Build loyalty and maintain existing customers• Build brand/service awareness• Encourage product adoption• Promote sell-through

Mobile Coupon Tactical Benefits• No paper coupons to remember or carry…coupons are saved on phone and tied to customer’s phone number• Offers saved automatically to customer’s account which is tied to their phone number—customer’s phone number is their redemption code• SMS + pin pad terminal redemption works on ALL phones (not just smart phones or apps) Ghiradelli Coupon Get $1 off the deluxe Ghiradelli Chocolate• Coupons are always on customers’ person, always available Square Sets. Exp:9/30/10 for redemption Msg & Data Rates May Apply• Increases checkout efficiency over paper and eliminates misuse/fraud• No new hardware required, simple integration with existing POS PIN pads, optical scanners and loyalty cards offering an easy to deploy closed loop system• Redemption is trackable and ROI is highly measurable with digital reporting and analytics

Retailer Perspective: Mobile Coupon RedemptionNO check out slow-downNO new hardware (scanners, servers, PIN pads or readers)NO bad user experience and resulting lost revenue Create OfferNO limited user phone reach Refine Deliver New Targeting Coupon Hardware Fraud Offer POSYES minimize cashier involvement Settlement Redemption No IntegrationYES leverage existing retail technology systems Proprietary SolutionsYES maximize shopper participation and reach (older phones too!)YES integrate with discount card programs

POS Mobile Coupon Redemption SolvedRedemption Options Available• Standard payment terminal pads using mobile phone number• Register hot keys or on-screen “virtual” payment terminal• Integration with discount card account• Scan with optical barcode scanner Point of Sale Redemption for Mobile Coupons Mobile Redemption Solution The mobile POS redemption solution aggregates POS hardware redemption Settlement systems so a simple SMS coupon or mobile barcode coupon can be redeemed on virtually any POS system.

Full Cycle Mobile Coupon Redemption 1 6 2 5 3 4

Location Aware Messaging25

Location Based Services Growth• High Growth: LBS adoption will accelerate across the globe: total addressable global market for GPS navigation and LBS will rise by 51% (CAGR) to $13.4 billion in 2014, from $1.6 billion in 2009• LBS search and advertising will be fastest growing segment in LBS, rising from $207.3 million to $5.9 billion in 2014• By 2014 there will be 780 million unique global users of LBS search and advertising with 15.6 billion click throughs• North America (U.S. and Canada) will account for 32.4% of the world market share for GPS navigation and LBS spend in 2014• North America will lead the growth in LBS search and advertising, with 136% rise (CAGR) reaching $2 billion by 2014 IE Market Research “3Q 2010 Global GPS Navigation and Location Based Services Forecast”

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LBS Geo-Fencing: The North FaceNorth Face Geo-Fenced SMS Campaign• 1,000 geo-fences created in New York, San Francisco, Seattle and Boston• Urban areas had half mile perimeters, suburban areas up to a mile around the stores• SMS messages about offers and seasonal product arrivals• Uses multiple LBS technologies: GPS, carrier provided user location info, cell tower triangulation & hybrid• User opts-in to campaign to receive messages• Maximum of 3 texts per week for any user• Opt-out rate is low at 6% Location Based Geo-Targeting: Placecast, LocAid et al…

mCommerce: Retail Sales via Mobile31

The Approaching Tsunami of mCommerce• In the U.S., mCommerce sales are expected to more than triple to upward of $7 billion by 2014 from about $2 billion today• Approx. 50% of smart phone owners say they have already, or soon will, use their phones to do mobile shopping• Annual global revenues from mobile devices for Amazon totaled $1 billion in 2010• Ebay expects its 2010 mobile commerce revenue to top $1.5 billion—an item is sold on Ebay Mobile every 2 seconds• In 2015, shoppers around the world are expected to spend about $119 billion on goods and services purchased via mobile phones

mCommerce Marketing Spend by Sector/AgePercentage of 2011 mCommerce spend by product category and age group

mCommerce Single Transaction Customer sees an The scan initiates a advertisement for Getitcard/Scanbuy Phillips in traditional landing page that media (e.g billboard ) includes product info and decides to “Scan and a payment window ´n Buy” or text to buy the shaver The buyer enters their payment card details and Save 15% on the new Philips 7000 address sent shaver. Scan ´n Buy now or Bancore handles the by URL or text PHILIPS to 87812. transaction and email informs merchant with required information

mCommerce Simple Payment Solutions

mCommerce Cast Study: Steve MaddenSteve Madden Mobile Site• Full mCommerce environment for shoe purchases• Uses familiar Web design and interface for mobile site• Not an app, this has the full reach of mobile Internet (mobile Web browsing has nearly 30% use penetration across all mobile users)• Include “You Might Like” engine to make buying experience even betterResults*• 10.5% of total Web traffic for Steve Madden is coming from mobile• 250% increase in traffic from 5/10-10/10• Percentage of total Web traffic that is mobile is trending upwards fast: April 2010 4.4%, May 7.9%, June 8.6%, July 9.5%, October 10.5%• 880,000 visits in 6 months totaling 6.25 million minutes• Average time on site 7 minutes• In 6 months 7,856 products sold on mobile site for $520,866 in revenue with average order at $83.70*Source: Mobile Marketer 10/27/10

Making mCommerce SocialSteve Madden Mobile Site Evolution• Social marketing enablement added to mCommerce functionality• Uses Facebook “Like” functionality that is pasted to users Facebook wall• Enables viral product marketing tactics• Includes “You Might Like” engine to make buying experience even better• The addition of the social elements Increased traffic 30% in 24 hours• Using Metrics: shoes that get the most “likes” get special promotions focusing marketing on higher performing products to increase revenue• To drive people to use “Like” in mobile site, Steve Madden promotes functionality in their own Facebook page

Large Retailers: Target mCommerce Site

mCommerce Best Practices• It is all about the 60 second transaction!• Create the right-sized product catalog for mobile• If you have large catalogs use groups and categories• Combine with mobile coupons or promos• Keep the UI simple with “one-click to buy”

The Future: Near Field Communications (NFC)For the future of mobile retail in US…look to Japan and NFC • The mWallet for payment • Content and information delivery • Frictionless opt-in CASE STUDY: McDONALD’S JAPAN • May 2008, McDonald’s introduced NFC-based coupons—users download coupons through a mobile application and touch a reader/ writer at the point of sale to instantly redeem their coupons, as well as pay for the purchase, and receive loyalty points • Promotions are planned according to each individuals purchase history; profile data and contextual factors like time of the day, or what the weather is like ALL JAPANESE MOBILE USERS • Investment: large backend infrastructure and putting NFC reader/ writers into 3,800 branches with a dedicated mobile marketing joint venture with NTT DoCoMo • Stats: 16 million registered users (>12% percent of the Japanese population), >100 million mobile page views per month, and in less than 2 years, the number of coupons now exceeds 4.5 millionSource: Christopher Billich www.mobithinking.com 40

Social Networks and Mobile Mobile Web is growing faster than desktop did. Social sites serve up more than HALF of all page views on the mobile Web (USA) The number of people accessing the mobile Web is expected to overtake the PC as the most popular way to get on the Web within 5 years. Linking rewards programs to mobile social networks Source: How Interactive Marketers Can Reach US Mobile Social Network Users, Forrester, December, 2009

Mobile for Social 2011Growth of Mobile Social Networking• Up over 350% in 2010 (Nielsen)• Users that access Facebook on their phones are twice as active• 35 million mobile Facebook users accounts for 15% of all mobile users and half of all mobile Internet users• Average Foursquare user checks in 3-4 times a dayGrowing But Still an Infant• Twitter has only 7% penetration amongst all SMS users—it’s a great start but may be leveling out• While Foursquare has great user engagement numbers (users check in 3-4 times/day), there are only 5 million users globally, with 60% in the U.S. which is only 1% of U.S. mobile subscribers• Only 4% of online adults have used social location-based applications• “Check-in” apps seem to be a niche marketing play at the moment in terms of reach

Leading Industry Resources• Companies That Can Help You ! Advertisers ! Marketing Agencies ! Direct Marketers ! Solutions & Service Providers e.g. iLoop Mobile• Industry Portals ! Mobile Marketing Resources (open community) http://mmresources.net ! Mobile Marketer: www.mobilemarketer.com ! Mobile Commerce Daily: www.mobilecommercedaily.com ! Mobile Thinking: www.mobithinking.com• Trade Associations & Industry Enablers ! Mobile Marketing Association: www.mmaglobal.com ! Direct Marketing Association: Mobile Marketing Council http://www.the-dma.org/segment/mobile ! US Short Codes Administration www.usshortcodes.com

Thank YouGO MOBILE!Visit www.iloopmobile.com to learn how we can help you mobileenhance your marketing.Contact sales@iloopmobile.com (408) 907-3360 and we’ll help youget started. http://twitter.com/iloopmobile http://www.facebook.com/group.php?gid=71337661648 http://www.linkedin.com/company/iloop-mobile http://www.youtube.com/user/iLoopMobile

Webinar deck: Mobile Enabling Retail Marketing

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