Today, marketers have several methods and tools to engage with their customers and focus on relationship building. Mobile marketing combined with social media allow companies to send out customised content to customers. With social media marketing incorporated into their marketing strategies, businesses are set to allocate a budget for mobile marketing. Many companies are already making use of mobile marketing, using sms campaigns and mobile websites. However, very few have a system in place to measure their Return on Investment (or ROI).

According to an April 2011 survey by King Fish Media, many marketers are still in the planning stages of devising a mobile strategy. A majority of marketers did not have a tracking system for mobile advertising even though they are aware of the importance of tracking ROI.  Below are some statistics from the report.

Can mobile commerce result in positive ROI?

Mobile marketing can transform a business’ profitability. For example, Intuit, an accounting software company increased its sales by 30% through its mobile tax products in 2010. eBay has an iPhone app through which it generated over $400 million sales in 2010. Pandora, the Internet radio service, reports that one in ten smartphone users use the service on their phones, getting the company a big chunk of the market share in its niche.

Currently, mobile marketing is more about engaging the customer rather than focusing on mobile commerce.  Another example is McDonald’s recent interactive billboard campaign in Sweden where they integrated mobile technology with a digital billboard.  The campaign aimed to get people to participate in the game without downloading any apps. Their phone picked up the participant’s location, letting them join the game via a website URL. If they played it for 30 seconds without losing, they won a coupon for the nearest McDonald’s. While it is not clear what the campaign’s ROI was, taking the cost of the campaign into account and the possibility of participants simply redeeming their coupons without buying any other products.

It is important to understand that social media ROI goes beyond monetary returns as it is also a return on customer engagement. It is possible to track how much time consumers spend to interact with the brand, customer loyalty and the chances of referrals from them.  According to the King Fish Media report mentioned earlier, a majority of marketers are tracking their website visitors from mobile devices using Google Analytics. They find that only about 8% of these visitors come from mobile devices and about 10% use mobile apps offered by the company.

Designing a measurable marketing campaign

The happy trend is that people are responsive to mobile marketing campaigns.  Companies that offer incentives can measure the response to calculate ROI. These incentives could be in the form of coupon redemption, sales inside the store, number of people registering for alert reminders and so forth. Coupon redemptions are an effective way to measure and track response. A company called Eagle Claw Fishing Equipment encouraged its customers to text a keyword to make them eligible for an SMS coupon. Within four days of the campaign they experienced a 23% increase in their sales as they could track these redemptions.  It is a question of designing the mobile marketing campaign in such a way that it can be measured – making it easy to track and measure ROI.

Businesses leveraging mobile marketing strategies are using location-based campaigns to connect to their prospective customers, taking promotions directly to them based on their geographic location. Consumers have become quite savvy at using their smartphones, mobile phones and other handheld devices to research and find what they want online and while technology brings plenty of benefits, it also has its shortcomings.

When it comes to mobile devices there is an increasing concern over the tracking device in the phone. The iPhone, BlackBerry and Android phones have a location device embedded in the phone used by satellites to identify the coordinates of the phone’s location.  Location tracking has several advantages, for instance it can help the police or emergency services reach the owner of the phone quickly in case of emergency.  On the other hand, there are applications that make use of the user’s location to display information such as movie show times, restaurants in the area and other things the user might be interested in.  Sites such as Foursquare and Facebook offer their check-in feature based on location tracking.

It is in these situations that the lack of privacy and safety is highlighted as the information collected by these apps could easily fall into the wrong hands. As consumers download and enjoy their favorite mobile apps, it is difficult to determine who else can access their location information.  Even though devices, apps and sites have privacy policies on how they will use the information they collect, there is a good chance that it could leak. The obvious thing to do is to be wary about what we put out on the web.

Location tracking by Google and Apple was recently in the news and raised privacy and safety concerns with smartphone users.  The unencrypted data collected by these companies are stored on iPhones and iPads for over a year and synced to their personal computers. Even though Google and Apple both deny that any individual tracking data is collected, mobile marketers will adopt a wait-and-watch policy.

Location based marketing may be an effective way to reach consumers however, the fact that marketers can customise ads to consumers’ location may make consumers feel as if they are watched all the time.  What is your take on mobile location tracking? Share your views in the comments section.

Mobile marketing is fast becoming one of the most effective ways to reach an audience that marketers may not be able to reach with traditional marketing methods. One might assume that most marketers would already have some long-term strategies in place to leverage this mobile platform but that is not the case. Many companies are still getting accustomed to this innovative marketing method.

Do you need a mobile marketing strategy?

Millions of mobile devices are sold every year and this makes it a great way for businesses to connect customers with their brands. Handheld devices like the iPad, iPhone, BlackBerry and Android phones make it possible to stay connected 24 hours a day. For businesses, this means the opportunity to engage with their customers exist 24 x 7. People use their mobile phones to access the Internet and download apps and businesses can take advantage of this and build their mobile marketing strategy around it.  Mobile marketing can come in different forms depending on the nature of your business. The predominant platforms are mobile websites (.mobi sites) and apps.

Your mobile marketing strategy would depend on your business. If you have an e-commerce business, you might consider offering an app or .mobi site so that customers can interact with you and easily buy from you. If you do not sell online, or if your purchase process is lengthy and complex, you will need to think of ways to keep your existing and potential customers engaged so that you can maintain healthy online client relationships.   This can be done by offering value-added content rather than hard-hitting sales messages. Consider generating a QR code that customers can use to access various types of content.   At the end of the day, your customers must perceive value and usability in what you offer and mobile marketing provides a great opportunity to build and enhance customer relationships.