June 3, 2011 in Trends
In case you haven’t already, you’ll start hearing about NFC and mobile wallets a lot. Google Wallet just launched, and other big players (Apple, PayPal, mobile operators, Mint?) are soon to join the party. Payments are being revolutionised from various angles, from retailer solutions (Square) to e-receipt management (Slice). Once these technologies become mainstream, consumers will be able to pay for their common purchases using a mobile phone, which will keep track of all receipts, loyalty schemes, and coupons. In turn, retailers will be able to easily collect and use individual customers’ purchase data. There’s a big reason why this will be a hit – an e-wallet will let people save money (that would be the perception at least . While it’s not clear how long it will take for this innovation to cross the chasm and reach early majority, it can’t hurt to think about potential marketing implications.
Loyalty programs 2.0
While customer loyalty has always been important, an e-wallet that tracks and lets you analyse all your purchases gives the concept a whole new dynamic. Loyal Cafe Nero customers know they go there quite often and spend something around £3 on their coffee every time. With e-wallet, they’ll discover that they’ve spent £434.21 at Cafe Nero last year, and will think hard and often whether the experience is worth this much money. In turn, Cafe Nero will have to find new ways to motivate loyalty, as “buy 9 get 1 free” stamp collection mechanic will suddenly be exposed as lame 10% discount. Loyalty programs will have to offer clear and substantial value, as customers will know very well what they are (not) getting for their continued patronage.
Active targeted coupons
E-wallets will mean a revolution for coupons as well. Forget untargeted, low-redemption attempts at segmenting customers on their price elasticity. E-wallets will enable precise targeting while removing redemption barriers such as forgetfulness or need for a physical coupon. Not only that, a clever app will actively promote redemption, by highlighting available coupons as you walk into your favourite store, and perhaps directing you straight to the correct aisle. With all the data about your purchase history and offer redemption habits, coupons won’t need to be one-size-fits-all. If you tend to ignore 10% off coupons, maybe you’ll be offered 15% off next time. Or if you always buy whatever has the deepest discount without any longer-term loyalty, perhaps you’ll stop getting interesting offers. With all the customer purchase data at marketers’ fingertips (or rather processed by clever algorithms), winning in the coupon game will require ingenuity and balls. I mean art
Will 2012 be the year of payment revolution? What else might change in marketing with mobile wallets? Share your thoughts in the comments below.