Data holds the key to smart mobile commerce: Interview with SAS

By Chris Lee

We continue our focus on mobile marketing with a look at how increased personalisation can help build deeper relationships between brands and their audiences. In the UK alone there are nearly 88 million mobile phone subscriptions, so more mobiles than there are people. Smartphone sales have long outpaced the personal computer and these devices have become indispensable elements of our day-to-day lives.

According to Alex Fovargue, retail specialist at analytics firm SAS UK & Ireland, this smartphone saturation – combined with consumer mobile behaviour – provides a unique opportunity for retailers to connect with each customer’s personal habits, desires and preferences.

“The frequency with which consumers use mobiles to search for and receive information, the fact they are always on and always to hand, and their GPS location-based capabilities, make smartphones a goldmine for information and communication opportunities,” he told NMK.

Personalisation is critical to the success of the mobile channel, Fovargue believes. Recent research conducted by SAS and retail analysts Conlumino found that around 50 per cent of consumers said they were more likely to use a retailer if its offers were personalised.

“With personalisation, retailers can ensure that services, offers and information are matched to the user, improving their experience as well as increasing up-sell and cross-sell opportunities,” he added. “Data is crucial to this process, ensuring that customers are accurately and swiftly segmented by their demographic data and buying decisions. The smartphone is businesses’ natural ally; in both gathering this information and delivering it back to the customer at the right time.”

Consumers embrace direct communications

The days of consumers eyeing up promotional material with suspicion are long gone, according to Fovargue. SAS’ research found that almost 40 per cent of consumers now actively opt-in to receive marketing material from retailers. This reflects a shift towards consumers embracing the benefits of direct communication.

“The success of retailers’ mobile applications and social channels shows an appetite for increased engagement and communication with brands,” Fovargue argued. “In addition, the report found that nearly a third of consumers are likely to respond to relevant in-store offers, highlighting the increasing importance of location and the potential for mobile services.”

Smartphone users offer gold mine of data

According to a recent Google study, 97 per cent of smartphone owners use their phones at home, 85 per cent use them on the go, and 72 per cent in-store. As NMK recently reported, this has helped the rise of so-called ‘showrooming’, where people use their mobiles in store to research or complete purchases.

“This always-connected culture offers retailers unprecedented potential to create instant wins, by connecting with customers right when they are making a purchasing decision,” Fovargue said. “[Google’s] study reveals that a third of consumers would be likely to take advantage of an offer if they received it via their mobile device while standing in store. The potential impact of around 30 per cent of more than half the population immediately taking up offers would have a substantial impact on retailers’ profit margins.”

The crucial element for businesses is ensuring that their communications are accurate, insightful, personalised and timely, Fovargue advises. The information gathered from mobile data, coupled with customer details and a wealth of other data sources, can transform businesses’ digital marketing and the relationships they build with the customer.

Use location-based data to personalise marketing

Mobile data allows brands to go beyond basic demographics and generic segmentation, Fovargue added. By combining geo-location data with data generated through loyalty schemes, retailers can use data analytics to provide real-time, specific, individualised discounts and incentives. This kind of personalisation can make a real difference to average order values and can increase loyalty, he believes.

Fovargue described how, after using SAS predictive modelling, card maker Hallmark discovered that a good predictor of a customer visiting a Hallmark store was if they had visited one recently. Combining this detailed information with predictive modelling and data mining meant Hallmark could customise its direct marketing campaigns to time offers more effectively.

“In today’s retail market, in order to achieve superior growth retailers need to do two things: retain their existing customers at the same time as attracting new ones from rivals. This battle for market share, or share of wallet, is particularly pronounced as organic growth is thin on the ground,” Fovargue argued. “Engendering customer loyalty is key and mobile opens up the next level for loyalty schemes in the UK. As technology evolves, retailers can use data and analytics to get even closer to consumers through rich, personalised and relevant offers.”

Smartphones and tablets have rapidly become the device of choice for UK consumers. The opportunities these always-connected devices are creating allow retailers and businesses to have unprecedented insight and never-before-seen access to consumers, right at the point of purchase, Fovargue concluded.

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