Alcone Marketing Group – Consumer Lab

The Consumer Lab is the consumer insights and brand strategy group at Alcone Marketing Group, a consumer activation company.

SMS Text CRM: Retailers Come Calling, Literally, for the Holidays

Mobile Phones Become
Part of the Mix to Reach
Tech-Savvy Consumers

Wall Street Journal

On top of their usual blitz of holiday ads in newspapers, on TV and on the Web, a variety of retailers are testing a new marketing medium this year: the mobile phone.

Shoppers who sign up with Nordstrom or Wal-Mart, for example, will receive text messages with information on discounted merchandise and special sales. Best Buy is offering gift suggestions on its mobile Web site. J.C. Penney is going further, offering to make wake-up calls to early-bird shoppers eager to get a head start on Black Friday, the traditional kickoff to the frenzied holiday retail season. (This year, many J.C. Penney stores will open at 4 a.m. on the day after Thanksgiving.)

[J.C. Penney offers customers who sign up for texts a bonus: a Black Friday wake-up call.]
J.C. Penney offers customers who sign up for texts a bonus: a Black Friday wake-up call.

Between a weak housing market, a credit crunch and rising gas prices, retailers are bracing for what could be an unpredictable holiday season. The National Retail Federation, a Washington-based trade group, expects holiday spending to rise 4% to $474.5 billion this year, but that’s down from an increase of 4.6% last year. In a sign of the tough economic environment, J.C. Penney yesterday announced that its third-quarter earnings had dropped 9% from a year earlier, and the company lowered its target for the fourth quarter.

Companies have begun using mobile phones to market everything from electronics to cars to apparel and footwear, says Derek Handley, chief executive of mobile ad agency The Hyperfactory. Some retailers, such as Nordstrom, want to relay information only through text, while others, including J.C. Penney, are using mobile Web sites to try to engage consumers.

A major challenge for marketers is deciphering how much cellphone advertising consumers will tolerate. J.C. Penney and others say they target only consumers who sign up to receive the messages, and even then are careful not to bombard them. Typically, the retailers send out text messages from once every few weeks to a few times a week.

Retailers are adding cellphones to their marketing playbooks at a time when the effectiveness of television ads is being questioned, as more viewers change the channel or fast-forward through the commercials. Still, traditional advertising dwarfs digital advertising of all kinds. According to eMarketer, companies spent $2.8 billion on mobile advertising this year, compared with $21.4 billion for advertising online.

Marketers say they are encouraged by studies showing that about 80% of Americans use cellphones, and about 60% of those people text message, according to Forrester Research.

“Kids may be the early adopters, but they’re teaching their parents,” said Mike Boylson, chief marketing officer for J.C. Penney. “We knew we needed some experience in this space. We didn’t want to get caught flat-footed,” he said.

According to TNS Media Intelligence, J.C. Penney spent $463.5 million in marketing in 2006. The bulk of that is still spent on TV, print and other media, according to the company, with about 5% devoted to digital marketing, including a sliver dedicated to mobile marketing.

Nordstrom‘s mobile campaign focuses on the store’s department known as BP., which caters to young women. The company has been sending text messages since Nov. 2; recent texts include notice of a sale of V-necks, crewnecks, turtlenecks and cardigans for less than $40 and an alert about the start of the retailer’s twice-a-year sale.

J.C. Penney added mobile marketing to its holiday campaign based on the response it got from a back-to-school mobile-marketing effort this year. Aimed at teenagers and preteens, or “tweens,” it included video clips, wallpaper for cellphones, ring tones, style advice and text-message alerts on new products. Mr. Boylson declined to say how many consumers signed up or entered the mobile Web site.

For its holiday campaign, J.C. Penney created a mobile Web site that will launch Monday, along with its text-message system. On the site, consumers will find a gallery that will eventually include images of 64 different gifts, including items such as a video camera, satin pumps and a GPS navigation system; consumers can email images of gifts they like to themselves or friends.

They also can download wallpaper, Christmas-themed ring tones and songs including “All That I Want” by The Weepies, which is featured in the company’s TV ad.

Price!Points

Advertisements

Filed under: 1

3 Responses

  1. Its been pleasure for me to read this post. I really like this.

  2. […] solutions that keep shoppers in line and happy — to mobile ad promotions that help “ring in the Holidays,” and digital innovators that help us enjoy ”social shopping” to find what we […]

  3. […] management solutions that keep shoppers in line and happy — to mobile ad promotions that help “ring in the Holidays,” and digital innovators that help us enjoy ”social shopping” to find what we need — in […]

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

Categories

Blog Stats

  • 370,699 hits
%d bloggers like this: