There are a number of technological aspects that will develop over the next few years, some of which are behind-the-scenes technologies that consumers aren’t aware of, and some of which will directly affect and interface with the consumer. Because new technology is usually an enabling factor for commerce and innovation, any new technologies that come along must be examined from every angle: in essence, marketers need to look at each technology to find the problems that each new technology can solve.
For example, mobile phones
Having access to MMS picture messaging was not an obvious answer to many marketing problems. An unimaginative marketer may have decided to simple broadcast txt or small graphical advertisements.
But an imaginative marketer realises that each customer can be sent a unique QR/2D barcode to act as an on-screen loyalty card or coupon identifier. Telstra in Australia as well as vendors in Japan, Europe, UK and the US encourage these barcodes in many ways for vouchers, payment or rewards. read more.
[Unlike the emerging NFC options outlined below, most camera-equipped phones are already compatible to handle QR barcodes].
Coming Soon – Mobile NFC technology…
In terms of indirect uses for customer loyalty, the mobile phone presents marketers with a quick, cheap, and ever-present channel of communication that more often than not leads directly to the targeted consumer within seconds of broadcasting a message. It’s an excellent communication channel that allows consumers to send requests, receive information and transaction confirmations, receive coupons and vouchers, and even to make micro-payments (through premium rate numbers and text messages). In terms of direct uses for customer loyalty,
the mobile phone can take the place of the loyalty card, whether by means of on-screen identity numbers and bar codes or the simple use of a mobile phone number.
A number of the latest mobile phones now have both Barcode Readers as well as NFC (near field communications) chips built into them. HFC enables very close range (usually up to 4cm) wireless communication with other NFC devices (such as POS terminals or in-store kiosks). This effectively allows each consumer’s mobile phone handset to become a unique identifier, not only for payments and identity checks but also to replace loyalty cards and key fobs.
The applications for NFC technology embedded in mobile phones are growing rapidly as consumer awareness and acceptance of the technology grows. Apart from obvious applications such as contactless payments and transport or event ticketing, other uses already include:
1. Smart posters
This technology means that consumers can pick up promotional offers and mobile content (e.g. coupons, voice messages, sounds, video clips, wallpapers, ring tones, special offers, and so on) by simply holding their phone up against a promotional wall poster or billboard;
2. Loyalty card surrogacy
This means that consumers can opt to use their 2D Barcode, Tag or NFC-enabled mobile phone as their loyalty programme identifier instead of carrying a separate plastic card or keyfob – and if this is done with enough loyalty programmes, the problem of ‘plastic fatigue’ could become a thing of the past;
3. Contactless couponing
This means that consumers can automatically pick up personalised coupons or offers from kiosks and offer boards on the way into a retail store, just by holding their phone up as they walk in;
4. Peer-to-peer sharing
This enables the quick and easy sharing of promotional coupons and media content with other consumers, in cases where sharing of the coupon among friends and family in an almost viral way is desirable (for example, an open-to-all offer such as a ‘buy one, get one free’).
The Time Has Come…
A report by Impaq Group put forward some convincing arguments to suggest that the time has come for the mobile phone to replace the loyalty card. Over 30% of consumers never remember to carry their loyalty cards or have lost them. But the customer-facing elements of a good loyalty programme (i.e. clear rules, an acceptable currency, simple redemption, relevant rewards, achievable results, and flexibility) are not bound to any particular medium, so the mobile phone can stand in for loyalty cards without affecting the operation of the programme.
In practical terms it would be a relatively simple matter for almost any modern mobile phone handset to display a customer’s identifying bar code (or other machine readable image) on-screen, either as wallpaper or as a saved image or MMS message. The consumer then only needs to show their phone at the check-out to identify themselves. And it certainly would encourage interactivity, leading to additional engagement in the programme. Members could be reminded before Happy Hour promotions or other member events. They could have their points balance available at all times, encouraging them to redeem them more regularly.
In addition, catching the consumer when their interest is at its peak (e.g. being able to hold a mobile phone next to an advertisement poster to book event tickets) means that the transaction is decided upon and completed while the consumer’s desire is high. The ticket seller could then use a simple text message to remind the consumer when the event is near, and either give instructions on how to print tickets at a kiosk or deliver a uniquely coded ticket to the mobile phone for presentation upon arrival at the event.
Using customer feedback to increase loyalty…
At the same time, improved communications and CRM systems that provide cross-enterprise customer information will make it possible to enter into much more meaningful dialogue with customers while, at the same time, making it much easier for customers to respond. In order to make the transition from mass marketing to individual communication with customers, and to begin accurately anticipating customer response rates, a truly integrated customer segmentation and dialogue application (e.g. on the internet) could allow marketers to increase the accuracy of segmentation, and to develop more cost-effective campaigns for cross-selling, up-selling, customer profitability, and customer loyalty.
This kind of customer feedback should be a key part of any customer satisfaction and loyalty initiative. After all, a loyalty programme’s purpose is to collect data that helps a company respond better than its competitors to the consumer’s needs and desires, and to provide the kind of service and product offering that just can’t be matched.
This article is an edited extract from the 36 chapters of detailed coverage in ‘The Loyalty Guide III’, which is The Wise Marketer’s latest 920 page global guide to customer loyalty programmes, techniques, practices and theory. The report is available now, worldwide, for £1150 (approx. US$1995 or Euro 1495).
See TheLoyaltyGuide.com for the free executive summary, downloadable chapter samples, table of contents, online searching, and online ordering.
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