Magazine Article | June 25, 2012

VARs' Guide To Loyalty/Mobile Marketing

By Business Solutions magazine

Significant Trends

Think M-V-P: Mobile, Value, Personalization — “Merchants need to take loyalty up a notch through mobile messaging, making rewards and marketing messages more personalized and immediate. Merchants can also improve value options by moving from random discounts to rewards options that include intangible experience or service-based rewards as well.” Teddi Davis, VP of marketing, ProfitStreams.

Loyalty Is Evolving — “With the rapid adoption of mobile and social technologies, loyalty programs are undergoing fundamental changes. Initially, loyalty programs were adding text messaging and ‘like’ buttons to their systems; now, we’re seeing these technologies taking over the role of the traditional loyalty card itself. Mobile-based programs now allow users to run a smartphone application tailored to the venue or even use their mobile numbers as their loyalty card itself. Social-based programs allow customers to become brand advocates for their favorite businesses, and ‘gamification’ allows them to earn badges and special recognition as virtual loyalty rewards.” Travis Priest, VP of loyalty, Mercury Payment Systems.

Pitfalls To Avoid

Customers Need Marketing Help — “It’s important to realize that the clients being pitched on the technology aren’t necessarily experienced at marketing themselves. I’ve seen installations of marketing solutions that are technically perfect yet still fail, as the end user doesn’t understand what or how to execute on the data and customer list they’ve compiled. In my view, this is not a reason to avoid loyalty and mobile marketing solutions — it introduces the opportunity to offer consultative service, either through the VAR’s own resources or through partnership with a local marketing firm.” David Gosman, CEO, pcAmerica

Support Multiple Mobile Phones — “Not doing so limits the number of consumers that can take advantage of the mobile marketing program, and hence the program’s success.” Steven Lane, americas marcom leader, Honeywell Scanning and Mobility Help Build

Compelling Loyalty Programs — “VARs should work with their merchants to design programs with a mix of rewards that help them stand out. Discounts alone are not the basis for more mutually satisfying customer relationships.” Teddi Davis, VP of marketing, ProfitStreams

Sales Advice

The Time To Sell To Retailers Is Now — “I think nonhospitality retailers are about to more broadly begin implementing loyalty programs, thanks to the rapidly developing mobile and social marketing offerings. While loyalty is a feature often asked about, small retailers typically don’t have the resources needed to do it well. Some of the new services and incentives becoming available will likely create more real demand for loyalty instead of window shopping.” Dana Bargell, director of marketing, SBS/Keystroke POS

Expand Your Vocabulary — “To successfully sell these new loyalty programs, POS VARs will need to expand their vocabularies to include a few of the latest trends in digital marketing. VARs must be able to help merchants solve their main marketing problems, namely the lack of coherent analytics, inability to directly engage their customer base, and difficulty in measuring performance across a variety of digital and analog media. The VARs who can integrate these solutions into their sales presentations will ultimately find greater long-term success with their merchant customers.” Travis Priest, VP of loyalty, Mercury Payment Systems

Why Sell Loyalty Solutions?

Boost Your Trusted Advisor Status — “Loyalty/mobile marketing can mitigate top-line revenue caused by the slow economy. Mobile marketing campaigns built around a loyalty database of repeat customers can be far more profitable than a ‘Groupon approach,’ which gives away a lot of margin to new customers, often without generating repeat business. Put another way, marketing campaigns built around repeat customers is the ‘gift that keeps on giving,’ both for the retailer and the VAR, as they reinforce the VAR’s status as a trusted advisor.” Steven Lane, americas marcom leader, Honeywell Scanning and Mobility

Easily Upsell Existing Customers — “Though well-known, it is easy to forget how much easier it is to retain customers than to find new ones. VARs will find this an easy sell with appropriate positioning. The trick is to leverage loyalty and mobile for customer retention and to differentiate with a mix of discounts and experience rewards.” Teddi Davis, VP of marketing, ProfitStreams

Earn More Recurring Revenue — “Many of these solutions offer strong residual revenue opportunities to VARs, helping ‘recession-proof’ their operation.” Travis Priest, VP of loyalty, Mercury Payment Systems