Back in January, Marketing Land defined some major mobile trends considering mobile-as-a-channel:
“Mobile will also play an increasingly important role in the evolution and user behaviour of social networks both new and existing”.
And within those trends, we saw Mobile Wallets becoming a reality. One of the most relevant facts of mobile wallets, was that on top of the high usage for payments the growth of mobile wallet marketing, specially in the retail, travel and accommodation industries, alongside with the integration of location-based marketing tools such as beacons technology.
Business 2 Community reported in July that “44% of consumers would like brands to deliver deals and coupons to their mobile devices“ building an even more momentum for the mobile wallet marketing. Also in July, and after the successful launch in the US, we saw the Apple Pay debuted in the UK, making its presence at 250,000 locations all over the country and supported by major apps like Five Guys, Zara, YPlan and MyCheck in the restaurant industry.
In the second half of the year, on September 10th, Google “fought back” and released Android Pay in the US, already accepting American Express, Discover, MasterCard and Visa, their second mobile wallet attempt. Despite not being yet a native App brought several relevant functionalities and also allows storing gift cards, loyalty card and special offers. According to PYMNTS, “Android Pay is compatible with roughly 70% of the Android phones currently in the U.S. “ and, with Android occupying 51.6% of the US smartphone market, you never know how will this mobile wallet battle turn out to be.
It wasn’t long before Apple came back to the spotlight. A few weeks later, on October 1st, Apple launched its new operating system iOS 9. Among new devices such iPhone 6S and a new Surface Pro competitor (iPad Pro), this new update brought a makeover from Passbook App to Apple Wallet, a new loyalty program and EAN 128 codes for digital passes. Dunkin´ Donuts, Walgreens Balance Rewards, MyPanera, among others brands are already supporting these new iOS 9 features.
Right after the launch of Apple’s new iOS, Android Pay pushed a new loyalty program which allows its users to buy cheaper Cokes after the purchase of full price Cokes at vending machines. According to PYMNTS, “the move has been widely applauded by mobile watchers, who note that Google is going the extra mile to help users build habits around phone use but giving them an easy and literally rewarding way to build the habit.”.
Apple continued expanding Apple Pay with the launch in Canada and Australia in November. Jennifer Bailey, Apple’s vice-president for Apple Pay mention to CBC “the company is starting with American Express in Canada and Australia because it’s both the card issuer and the payment-network operator so co-ordination is easier“, meaning that Visa and Mastercard users still have to wait for compatibility. However, back to 2014 and according to the Nilson Report, Amex users accounted only for just 5% of Canadian spending and 17% in Australia, so the outcome is still being figured out.
For Apple next countries will be Spain, Hong Kong and Singapore during 2016, while for Google the next target is Australia.
With all these launches and features upgrades, Passworks have been evolving as well. Using Passworks platform it is now possible to create passes with EAN 128 code with an alternative code for iOS 8 users and also to deliver mobile passes through CSV file, Email and SMS, which makes it possible for brands with different types of CRM to create mobile content. Another obstacle that usually stands in the way of brands’ campaigns is the POS implementation and technology compatibility issue, due to the fact that most of scanners only read a certain type of code, which made it impossible to create marketing campaigns that couldn’t be redeem. Henceforth, Passworks team developed an App called Passworks Scanner, available for both Android and iOS that enables Passworks’ users to use this app to redeem the passes and monitoring the campaign. Also, Passworks developed its own wallet app, which enables Android users to experience the same Apple’s Wallet usability. Finally (wow, it was a full year!), Passworks is having a work-in-progress makeover, which means that during these next few months, there is going to be a lot of improvements, as seen by the new already implemented design.
With the emergence of this new mobile wallet ecosystem, leaded by Apple Pay, Google Wallet, Android Pay, Samsung Pay and PayPal Wallet, this means a great opportunity for brands to invest because not only it is increasing exponentially the visibility among users but because it is starting to change other markets, such as banking, and become mainstream.
According to Business Insider, “Apple announced a number of forthcoming changes to Apple Pay, including synchronization with rewards cards”, which means that marketing is even more embedded on these interactions and that these digital channels provide a relevant experience for consumers and opportunity for brands.
There is a great concentration on the mobile business, whether in payments, marketing or advertising. 2015 is not yet over and the numbers showed by EConsultancy are already showing a “10% increase in paid search advertising spend compared with last year, with all growth coming from ads on mobile devices”. Nevertheless, the outcome is always dependent from brands’ marketing strategies, context and how well do they really know their consumers’ behaviors and engage with them. More and more there is no way to escape the premise that “mobile can no longer be viewed as a separate channel”.
The bottom line is that brands must put the consumer at the center of their digital strategy because location-based mobile marketing drives multi-channel conversions, offline actions and consumer engagement, as can see on the Warehouse’s case study: “Since moving our coupons to wallet, we’ve seen significantly increased top-of-mind visibility among consumers, and we expect to achieve seven-figure sales results from our investment in 2015”.
The unique features of iBeacon truly offer the ability to revolutionise retailers’ in-store experience, by allowing a better understand of customers’ path, real-time interaction with their customers, which represents a huge potential to engage in new products and offers to increase sales. But automatically there are two questions that arise.
The first question is what is an iBeacon and how it works? Beacons are Bluetooth Low Energy (BLE) devices, that work as small indoor positioning systems, to send information to nearby smart devices. In the case of a smartphone that information is delivered via the brand’s App or through Passbook, and then displayed as a push-notification on a pre-subscribed user’s screen.
This enables retailers to send-up-to date, contextualized and relevant information to a customer depending on their exact location in the store and based on their behaviour.
For example, imagine you’re in a department store that sells a vast range of products, each time you walk past each section and are near that particular beacon you’ll might get a different message on your phone, be it promoting a new line of clothes or a discount on French wine etc.
The second question that needs to be asked by the retailers is ‘What can Beacons offer to my customers?’ The answer to this question is very simple; Facilitate and improve their in-store shopping experience. iBeacons offer a cost-effective way to efficiently engage with customers on a platform they are familiar with, their smartphone.
These days, the smartphone goes everywhere with the customer and it’s already integrated into their shopping habits, particularly as many major retail brands offer an App to browse and buy all their products. According to a research carried out by Swirl, 85% of those who own a mobile shopping App use it whilst shopping in a store. Furthermore, 65% of them said they consult their smartphone whilst in a store to find out about products and offers. This means, that through the smartphone, retailers already have a ready-made platform to attract their customers’ attention, and a push notification from an iBeacon is one of the best ways to do that.
The benefits of this technology for both retailer and customer are endless, and the possibility to create more interaction between the two is one that can even bring more trust and build the relationship, whilst allowing the retailer to reap the rewards of offering them better service.
Finding the right equilibrium to make the best use of iBeacons is crucial. In the case of normal push-notifications, the balance of sending the right amount to users is a difficult thing for brands to gauge. However, with real-time location-based push-notifications, retailers can send information to customers at a time when they actually want to find out more about product offers, and best of all, since they are already in-store means they are in the perfect place to act on those messages and buy products.
iBeacon can also work side-by-side with a store’s existing technology, to give retailers a way to better understand their customer’s behaviours, tastes and needs, whilst offering them a more personal shopping experience.
For example, when iBeacons’ push-notifications are used in conjunction with the store’s App and existing CRM platforms, retailers have the ability to tailor the messages they send out to specific customer group.
How it works is that when the customer’s smartphone receives the information from the iBeacon, prompting the App to send a push notifications, the store’s system can also be notified who it is that has entered the store. Automatically, the staff working at that time will, have access to important information, such as purchase history or what tastes and prefer products that customer has. Likewise the message sent out by the iBeacon, could be totally personalized and can be sent only to a particular group of shoppers and thereby maximise the exposure of certain products to the right target group.
Summarising, iBeacons represent a neat and effective way for retailers to better understand and get closer to their customers by enabling them to easier access contextualized and relevant offers, and thereby increasing sales.
Very soon we will see more machine-to-machine (M2M) communications between connected devices, allowing technology to create more efficiency and further improving our lives. iBeacons provide an insight in to the near future of that interconnected world of the Internet of Things (IoT).
Retail stores, airports and sporting events to name a few have already demonstrated why there is so much hype about the potential of ibeacons and the innovative ways it’s enhancing our mobile experiences, including more relevant, personalised marketing efforts and more effective ways of communicating with the public at events.
Apple’s release of their iBeacon functionality paved the way for a new way of looking a Bluetooth Low Energy (BLE) and unleashed the premise of using beacons in conjunction with smartphones, especially for digital wallets.
iBeacons are a great example of how IoT will function with cheap, low energy devices interacting with smartphones or tablets to bring ordinary objects or locations to life, intrinsically linking the digital and physical worlds together. Furthermore, the easy accessibility of obtaining information from a beacon makes them ideal for use alongside smartphones, with a simple but effective push-notification being the preferred current method of relaying info or sending coupons.
Large companies from Major League Baseball to Virgin Airlines have led the way in adopting beacons, but it’s in retail that many are predicting it to have the most influence, especially in customer spending with Juniper Research suggesting there will be over 1bn mobile coupon users by 2019, highlighting the importance of digital wallets such as Apple’s Passbook or Google Wallet in the mobile marketing sphere.
The current use cases of ibeacons is just the tip of the iceberg in its own future potential and that of the IoT which will create a world linked by internet-connected devices, which in turn will create more productivity for all.
