Optism™

Note: Optism is republishing our five most popular blog posts of last year, this was number #2  for 2012 and was originally published on January 27, 2012.

Not that long ago, people bought everything from local shops. Shop owners had personal relationships with their customers. They learned through conversations with these customers what types of products and services suited them. With mass marketing, this all changed. We gained a lot in efficiency and economies of scale, but sometimes we lost that all-important human relationship. Today, we can get up close and personal again by using a mobile marketing strategy that employs permission-based techniques.

Using permission-based mobile marketing strategies such as asking people for their permission first before engaging with them on their mobile phones, provides mobile operators, marketers and their brands unprecedented access to a potential customer’s attention and an opportunity to build their trust. As marketing guru Seth Godin has made clear, attention is a scarce resource in today’s world of mass marketing overload. To make the most of this unique opportunity, you need to recognize the very “human” nature of connecting via a mobile phone. And you need to demonstrate very quickly that what you are offering – your content – is worth paying attention to.

Here at Optism, we have developed six “best practices” to help you maximize the value of your permission-based, mobile marketing initiatives by thinking human to gain attention, build trust and  drive engagement from your audience.

1. Be transparent

Permission-based mobile marketing begins with you obtaining someone’s consent to on-going communication on their mobile device. Make sure customers understand what they can expect if they opt in. Also, be very clear about how they can opt out at any time. This is no time for “small print!” Being up front and honest with your customers goes a long way in building trust and loyalty.

The more you learn about your mobile audience, the better you can tailor your messages to suit their interests. So ask what interests them instead of assuming what they like based on their actions. Be transparent by making sure people understand and are comfortable with how you are going to use their information. Reassure them that you will respect their privacy and that you will only use the information they provide in the manner you have specified. (Of course, then make sure you do just that!)

2. Don’t try to bribe people

It makes sense to reward people who opt-in to your mobile marketing program, but be creative with that reward. Don’t try to bribe people with a glitzy prize. Offering a huge “prize” as a way to collect opt-ins isn’t an effective way to begin what you want to be a long term engagement. People will opt-in solely to qualify for the contest or prize and then opt-out. You want to attract people who are genuinely interested in your product or service.

Remember, rewards also don’t have to be monetary. If you provide valuable information, advance notice of special events, compelling developments about products or services that fit the recipients’ lifestyles, they will recognize that as the reward.

3. Use simple language

With mobile, you really need to be economical with your language: messages should be short and to the point. Choose words and concepts that are easy to grasp and unambiguous. Of course you also want to be true to the voice of your brand, but demonstrate your understanding of your audience by using language that resonates for them.

Mobile is a one-to-one communication. Use the kind of natural language you would use when communicating with your friends and family. Avoid “marketing speak” and clever turns of phrase –you’re talking to an individual on their personal mobile device. Speak human and build trust.

The words really do count. We find that opt-in rates are noticeably lower when the opt-in message is long and confusing. Starting with your very first message, keep it short and simple.

4. Don’t try to do too much at once

Don’t try to collect everything in one exchange. As you would in any human interaction, count on the relationship to grow and deepen over time. Ask for something small to start, reward the person that gives it to you, and then ask for something more. Permission marketing is like dating and you don’t want to propose marriage on the first date.

Use the first conversation to collect key information like age range, gender and primary interests. In subsequent exchanges, refine your understanding of those key elements. For example, in the first exchange, you may learn that a person is keen on sports. In subsequent conversations, you can narrow that down to specific sports and then favorite teams. Each exchange should contribute to your understanding of the customer and the customer’s appreciation for what you have to offer. Conversations need to be constructed in an intelligent way. In essence, less is more.

At Optism, we have found that when completing a profile, people stop interacting after having answered three consecutive questions – typically going from a 90%, 75% and 65% completion rate for the first three questions, and then dropping to a 30% completion rate for the fourth question. Optism best-practices show that these completion rates can significantly be improved – simply by thinking human and not interrogating your audience.

5. Expect the unexpected

People don’t always act the way you expect them to, or even the way they say they will, so it pays to be ready for anything. You can run focus groups that tell you people will respond if you frame your message in a particular way, but be ready to make changes quickly if things don’t go according to plan. This goes beyond simply collecting statistical results. If you don’t have the expertise to undertake this kind of analysis, consider hiring experts who do. The insight you gain can be invaluable and greatly increase the ROI for future mobile campaigns.

6. Think local

There are no universal rules that apply to all people in all cultures. Permission mobile marketing is about reaching out to the individual, engaging at a personal level. You need to consider local customs, preferences and habits. Communities may have different preferences in terms of days of the week or time of day. In some communities, it is not acceptable to ask someone what gender they are. In order to achieve positive results with permission-based, mobile marketing, you need to be particularly sensitive to local nuances since you are reaching out to people on such a personal device.

Of course, you also need to talk to people in their language of choice. In many markets, this means that your mobile campaign must be available in multiple languages and you need to know the message recipient’s preferred language.

We believe that interactive SMS messaging – texting – is an ideal mobile marketing channel for reaching the widest possible audience. Texting also enables you to reach out to people with a natural back-and-forth, dialogue-based engagement. People carry their mobiles everywhere and they react quickly when a message is received. Using interactive messaging and adhering to our best practices, you can increase the likelihood that your permission mobile marketing campaigns gain people’s attention, build trust and increase audience engagement.

Visit Optism’s solutions for mobile operators and advertisers to see how we can help you drive results for your company.

At Optism, we would like to extend our thoughts and prayers to all of those that have been affected by Hurricane Sandy. Thank you to all of the tireless hours the emergency crews, police officers, fireman, national guard and other first responders are working to get us all back to normal.

Over this past year, we have been highlighting the developments in the mobile payments and mobile wallet space. There has been a serious lack of consumer adoption of mobile payment methods in spite of a tremendous amount of initiatives and announcements from major players like Google, Apple, PayPal, Starbucks and Square. As we reiterated in last week's blog post Mobile Payment Wars: Report from the Front Lines, there needs to be more cooperation between the players and more focus on providing value for the mobile consumer. We believe that until a viable solution comes along which provides a payment solution plus additional convenience benefits, the consumer will continue to be satisfied with the traditional payment methods of credit cards, checks or cash.

Echoing our sentiment, Marguerite Reardon wrote a post on CNET last week entitled, Mobile payments: A solution in search of a problem? She wrote, “There's been a lot of hype around mobile payments over the past year, but the No. 1 problem that the mobile payments market faces is adoption. Consumers simply don't see a reason to replace their cash or plastic with a phone. And yet one company after another is clamoring to get into the market.”

Ms. Reardon acknowledges that there are a number of compelling reasons why all of these players want a piece of the mobile payments pie. Technology companies see the growing emergence of both mobile and local to deliver targeted advertising and offers. Banks and Merchants want to stop paying credit card processing fees while the credit card companies want to protect their turf.  Meanwhile, startups flush with venture funds are poised to disrupt everything. As you listen to the announcements, they are all focused on the payment transaction rather than what could happen during the presale or post-sale, like reminding you to buy a bike pump when you buy a bike or telling you that you exceeded your cappuccino budget for the month. By switching the transaction from a ten cent piece of plastic with a magnetic strip to a powerful mobile computer containing all of users' information that is connected wirelessly to hundreds of other servers in real-time, the possibilities for the consumer should be both amazing and unbelievable.

For an example, visit the Google Wallet website. There are no pictures of people shown. Just an impersonal website focused on the following benefits; security, speed, savings and organization. Yes, we want it to be safe and fast. The savings only mention Google Offers, but what about saving on anything else?  The Organization topic sounds promising until you click on it, “Our online management center lets you view all your Google Wallet activity all in one place. Add or delete payment cards and shipping addresses. See both your online and in-store transaction history. It's all of your shopping, visualized.” That's it. No examples of how people use it. No videos from actual people or any testimonials. A missed opportunity to tell us how Google Wallet can make my life truly better or to at least inspire us with the possibilities.

Without an overarching problem or a wonderful possibility, Ms. Reardon is correct — mobile payments is a solution in search of a problem.”The market right now is not being driven by any specific or urgent consumer need,” said Aditya Khurjekar, co-founder and program direction of the mobile payment conference Money2020. “Instead it's driven by businesses looking to benefit from new consumer experiences, that are yet unproven. Ultimately, any new experience will succeed only if it is solved by working together for the common customer, and the experience is 10 times better than the current one. And that's a tall order.”

As we wrote about the potential of mobile payments and mobile wallets in March, “It should be more about helping you save time, providing convenience and hopefully, simplifying your life rather than just storing your money. It should have everything from your typical take out order at the local restaurant, to facilitating faster hotel room check-ins, to getting m-tickets for the football game that can be read at the point of entry to a stadium. It should help you reach your financial goals as well as your personal, and any other goals.”

Without a compelling solution, we believe that mobile payment adoption will continue to grow slowly. Others are forecasting a completely different future for mobile payments.  Two weeks ago, eMarketer published a forecast of mobile payment growth over the next four years. The forecasts are absolutely stunning. They believe that the annual mobile payments transactions value will increase from approximately $640 million this year to a whopping $62 billion by 2016. That is an average increase of about 230% or total growth of 9,600% over the next four years. The number of mobile payment users will increase by 6x to 48 million while average annual spending per user will increase by 20x to $1,294. To put these numbers in some context, currently about 1 out 40 Americans is spending about $7 a month using mobile payments.  Within 4 years, 1 out 6 people in the US will be spending about $100 a month using mobile payments.  $100 a month on mobile payments is not a lot of money. If your favorite lunch deli offers mobile payments, then you could spend $100 a month there easily. With compelling solutions in the marketplace, it might turn out that eMarketer is spot on with their forecast, they might even be underestimating the growth.

Maybe mobile payment adoption is slow because we are not setting our sights high enough of what mobile payments could be? Maybe mobile payments should be about wonderful possibilities rather than the realities of conducting transactions? We believe that until the mobile payment conversation turns towards the benefits for the consumer, adoption will not be there. If the conversation never turns, we will still have plenty of mobile payment solutions. Just slightly imperfect ones, and not quite as popular as they could be.