10 percent mobile coupon redemption rate

By Rimma Kats - April 1, 2010

Opt-in databases, mobile coupons and loyalty programs are at the top of the list of successful mobile marketing tactics for retail brands, according to an IHOP franchisee.

During an hour-long iLoop Mobile-sponsored Mobile Marketer webinar, IHOP presented case studies illustrating the power, reach and opportunities for success that SMS and mobile coupons provide retailers. The webinar panel was moderated by Mobile Marketer's Dan Butcher.

"SMS helped us reach out to our customers in a new way," said Ever Santana of Fabris Companies, franchise owner of two IHOP units, 17 Dunkin' Donuts, 9 Baskin-Robbins locations and one Sonic Drive-In. "We tested it initially to see if it would have a good ROI and what we found was that it's not only a great way to provide offers, but a great vehicle for communication.

"We plan to use it for other brands and increase our customer loyalty," he said. "We were also impressed by the age groups – we were getting younger groups, kids and even senior citizens.

"We've also seen a lot of additional people who came in with the coupons who aren't even members."
 
IHOP's campaign
IHOP is reaching out to consumers via an ongoing SMS marketing campaign. Consumers are encouraged to opt-in for a free short stack of pancakes.

Calls to action are publicized in Money Mailer direct mail pieces. Consumers are asked to text the keyword IHOPFREE to short code 686868.

The company hopes to add 1,500 members by the start of the summer.

Additionally, consumers can receive special event reminders to various IHOP events including Friday Clown Nite, Halloween, Easter and Christmas.

IHOP is seeing a 10 percent mobile coupon redemption rate.

"I look at cell phones and text messaging – it's the most widely used communication method," Mr. Santana said. "There's a low cost to get in, it's easy to execute, it reaches a wide variety of people and to me that was the homerun of the program.

"The offer that we chose to do, I think it is a very powerful offer," he said. "You have to start with something like that – once you get them in, you obviously have to wow them with your service."

IHOP initially sent out weekly coupons, but found that four times a month was a little excessive. It has since cut back to two messages a month.

The company extended its coupon offer earlier in the week when business was typically slower in order to get customers in mid-week.

Additionally, during some occasions IHOP would offer a free dessert, getting consumers to come in for a dinner instead of a breakfast.

IHOP is currently working with Money Mailer, which helped it with the SMS camapaign. Mr. Santana is currently working with Money Mailer on a campaign for his Dunkin Donuts franchises.

Mr. Santana will also incorporate mobile marketing for Sonic later this spring.

"SMS gave me the opportunity to get more people in the restaurant," Mr. Santana said. "I consider myself a mom-and-pop business and for anyone that wants to market themselves, [mobile's] low cost.

"I've done billboards and this is really the most cost-effective way to reach consumers," he said. "We haven't really had a large number of people that have opted out of the program – 90 percent of the people that opt-in to the program, stay in."

Successful campaigns
Money Mailer optimizes direct marketing results through integrated shared mail, one-to-one, and interactive solutions. The company worked with IHOP on its SMS campaign.

According to Money Mailer, mobile has been the best channel to extend advertiser's coupon reach.

The company works with the advertisers to build an opt-in database and runs promotional offers to entice a consumer to opt-in.

"We provide them collateral material and consult with them and make sure they're managing mobile," said Steven Gray, COO of Money Mailer. "We've seen successful mobile campaigns – we're consistently seeing conversion rates being 15-20 percent.

"Couponing is one of the number one things that consumers are looking for with their mobile phone," he said. "There is a commitment to mobile and a long-term focus to make this viable.

"At the end of the day, you are investing the opt-in database long term – that's something that we continually strive for."

Mobile marketing advantages
Michael Ahearn, vice president of marketing strategy at iLoop Mobile addressed the advantages of mobile.

There is an increasingly attractive ROI, higher level of engagement and interaction controlled by the consumer with mobile.

The mobile phone is always one, always at hand and includes a built-in mechanism.

Additionally, mobile easily integrates into existing traditional marketing channels and programs and, offers compelling campaigns with value the consumer understands.

"You can mobile-enable your traditional marketing," Mr. Ahearn said. "Mobile couponing can be very simple or very sophisticated.

"For smaller mom and pop users, there are solution providers for them," he said. "For retailers that are larger and are looking to create full systems, someone like iLoop Mobile would be a great partner."

An expanded call-to-action promotion increases membership and business can get extended customer profile data with Web site opt-in and start a database.

It is also important for businesses to know its objective and fit mobile with the overall brand and marketing strategy.

For a successful campaign, brands should begin with messaging, then build a mobile site and continue with other integrated mobile marketing initiatives.

IHOP suggests that a company should modify offers for different stores, use coupons and discounts as lead to communicate special promotions that increase loyalty, provide value to customers and recognize their needs and balance coupons with other promotions.

There are several keys to a successful mobile program, including commitment to promote campaigns, in-store POS collateral, a trained staff, use of all media for call-to-action, relevant and valuable offers, respectful message frequency and no more than 4 campaigns a month.

"I think that the system that we're currently using, it works very well for us," Mr. Santana said. "I actually encourage people to send offers to their friends, even if they aren't members.

"You obviously have to pick the right message that you want to send out and be comfortable with what you're giving away," he said.

http://www.mobilemarketer.com/cms/news/database-crm/5840.html

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