Mobile Marketing Strategies For Loyalty Programs

Providing mobile marketing values to loyal customers will drive business both in store and online. Loyalty programs also provide companies with easy ways to test promotions so that they can anticipate wide release conversion rates.

Partnering mobile marketing with customer loyalty programs will provide an excellent way for companies to reward their best customers with incentives. With SMS marketing, companies will provide a number of values to loyal customers who choose to opt in to the service. Businesses have already begun to find multiple ways to marry SMS and loyalty programs. Some examples include:

--Sending weekly local offers and sales event information to customers who shop at participating locations. Short codes provide a wonderful opportunity to allow customers to redeem offers. Businesses instruct customers to text a short code in order to redeem a discount or a free item.

--Providing information about exclusive offers for loyalty card customers. Businesses may send exclusive SMS coupons to their best customers according to the preference and interest information in their customer relationship database. For maximum conversion, businesses that have e-commerce capability should allow coupons to be redeemed both in-store and online.

--Introducing new items to customers, including new stores, new products and new services. When Dunkin Donuts rolled out their new lattes, a Boston location offered lattes to customers for 99 cents via SMS. Sales increased by 20 percent, and 90 percent of responders purchased an additional item. Fifty percent of respondents stated that they would return to Dunkin Donuts to purchase lattes or coffees in the future.

--Using customer response information to tailor marketing messages for a more personalized experience. Clothing retailer Gap utilized an SMS campaign in 2008 to target customers from the Midwest and from their email delivery list. The coupon offered a $10 discount on a purchase of $50 or more. Customers received information in their email accounts and had to text GAP to the provided number to collect the offer.

--Suggesting that customers turn into advocates for the business by forwarding offers or "going viral." Many customers who receive text messages are likely to forward promotions to friends. Promotions may take on a life of their own outside of the business mobile messaging opt-in list when businesses encourage customers to forward offers to people in their contact list.

According to statistics, using mobile advertising saves 500 percent over direct mail costs. Response to SMS is around 25 percent, where response to direct mail is between five and 15 percent. Research has also found that transaction averages are higher five to 10 percent higher for customers who receive SMS marketing. With statistics like these, companies can easily see the benefit of targeting mobile customers who are members of their loyalty programs. When transactions from a company's most loyal customers increase by 10 percent, companies will see significant revenue growth.