2012 with all its unknowns is looming. Let’s take a look at three tops trends that will affect promotion marketing, including mobile apps, the demand for more consumer data in exchange for discounts, and segmenting that data to better target and customize promotions.
Mobile apps go mainstream. Smartphone users are becoming increasingly comfortable using their devices for a variety of purposes. And roughly two-thirds of iPhone and Android device owners use mobile applications multiple times per day—indicative of the vast potential that mobile phones offer to marketers.
Next year, expect shopping applications particularly to become more practical for the consumer and anticipate double-digit growth in shopping app downloads. Consumers are demanding apps that fit seamlessly into their purchasing habits, versus those that are difficult to use, have only peripheral benefits or are not rewarding enough. New mobile technologies will make possible: intuitive mobile couponing, the electronification of paper-based processes (like rebate submissions) and easy mobile commerce interfaces. These areas should see significant improvements in 2012 as consumers continue to show more trust in using their mobile devices to shop.
Also, expect consumers’ primary demands of mobile shopping apps to be: finding deals, comparison shopping, getting coupons in store and simplifying the shopping experience.
However, retailers should be warned: as mobile apps simplify the ability to find and locate deals, more and more customers will show up ready and educated on how to take advantage of them.
Smart marketers will demand more for discounts. Companies have delivered on consumers’ voracious deal-seeking demands that have grown out of the struggling economic situation. But as more shoppers take advantage of deals, margins of the sponsoring businesses are getting taxed. Now smart marketers are going to begin asking for more from their customers in return for these deep discounts.
In 2012 marketers must use promotions as the catalysts for long-term engagement and ROI, versus just temporary sales lift. Deep discounts will migrate from instant deals to redemption-based models, and will require consumers to engage with a brand for a period of time.
The consumer redemption requirements to get a deep discount could be as simple as a Facebook “Like” or an email opt-in, or more detailed like participating in shopping preference surveys. This will give marketers the opportunity to collect critical consumer data, and provide new touch points for ongoing interaction. Plus, consumers hungry for deals seem willing to go that extra step: according to 2011 Parago research, more than 70% of consumers are willing to opt-in for additional emails when redeeming a reward.
Over the last few years this has worked well on Twitter and Facebook, where brands require customers to engage online to receive exclusive discounts. Research from Empathica shows that six in 10 consumers follow at least one brand via a social network and 40% do so to search for deals.
Next year, this linking of promotions to information gathering will expand more concertedly beyond social networks and become a strategy to reach all deal finders, on and offline.
Better segmentation for customized promotions. It is mission critical for retailers and manufacturers to find ways to both satiate deal-seeking consumer demands and prevent brand erosion. Gone are the days of massive “everything to everyone” promotions that generate flash-in-the-pan results. Instead, promotions will become more targeted, ensuring that they speak directly to a brand’s loyal base of customers, or a particular demographic that is poised for growth. This will not only protect the brand’s reputation and value, but will foster more loyal customers.
With the growth in redemption-based and cash-back incentives, marketers will be able to target specific buyer profiles with promotions. Need to target the wedding market? Give a deep incentive with a copy of a wedding certificate. Looking to market to college students? Offer free merchandise with purchase with a valid college ID. Marketers will offer better and more attractive promotions by simply segmenting their target customer, and crafting promotions around their buying types.
Promotional segmentation will help retailers and manufacturers compete on price while also appealing to target demographics and defining brand attributes.
Theresa Wabler is director of marketing at Parago, a provider of rewards-based incentive solutions. She can be reached at [email protected].
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