The clichéd adage “you don’t sell products; you sell feelings,” has never been more difficult to contest than in today’s digital age. Money has gradually become less physical and more digital, spurring new waves of products and services that reveal significant implications in daily life. Now, with the absence of physical [credit or debit] cards, marketing will have to evolve. The question is: “what do we do about our increasingly mobile consumer?
The key to layout successful mobile integration through a marketing and/or digital strategy is to understand how companies engage with consumers on-the-go. To understand how to engage with consumers on-the-go, we must consider the proliferation of the digital wallet, moreover, in-app mobile payments.
There is reason to believe that mobile app commerce will prevail over ‘tap’ commerce (NFC systems) as merchants denounce chip reading devices and result in the death of the card terminal. Chinese consumers serve as an example of the embracement of in-app mobile payments with apps such as AliPay, a payment platform by parent company Alibaba, with 450 million active users. In-app mobile payments waive the use of card reading devices and resolve to in-app commerce instead. From department stores to street food vendors, Chinese merchants have paved mobile payments to outdo NFC stations and exemplify that when there is no desire for a supplier to have a product met with the users’ needlessness of the product, it eventually unravels the elimination of that product.
The upsurge of mobile payments in the U.S. and Europe was delayed because businesses lacked the capabilities to install proper payment functions within mobile apps. Commercial and retail apps were mostly used for searching, gazing, or ‘favoriting’ an item to be purchased at a later point in time. Companies with mobile apps will lean towards integrating payment options, as opposed to being redirected to a website; conversion on a mobile device is six times more likely with an in-app mobile payment suite vs. redirecting to a mobile optimized website. As mobile apps progress, businesses are more prone to include payment functions in their digital platforms and consumers are more inclined to use them. The increase in sales is driving businesses to quickly shift to a better mobile approach.
Apace with vital marketing principles, companies must visualize their target audience and how they interact with the good and/or service the firm delivers. By being user-centric, businesses can complement daily activities of the consumer. Shopping patterns like time of purchase, repeat purchases, and recommended items can be monitored on mobile app data analytics. Starbucks’ Mobile Order and Pay continues to drive growth and contribute to sales marketing decisions given the plethora of data the app feeds the company. With more personalized recommendations using smart technology (also used by companies like Netflix and Amazon), Starbucks could potentially increase each sale amount by as much as 50% through additional purchase items. Companies like Dunkin Donuts, Five Guys and Taco Bell are also profiting from this notion. It is also important to consider that the mobile platform is a design led channel.
App design is an integral component for boosting sales levels within mobile payments. In other words, sales are dependent on [app] design. When designing for the best checkout process, the goal is conversion. Mobile users are typically time-starved and generally in motion. Consumers on mobile could dislike choice as opposed to a desktop environment, mainly due to the small screen, but also because of the nature of the expeditive purchasing process. The objective is to make it as easy as possible so that when consumers use the app they end up purchasing, hence the rationalization of [app] design’s impact on sales. The reason mobile commerce fundamentally differs from e-commerce is because the way consumers engage with their mobile devices is different from the way they interact with traditional e-commerce, desktop devices. Furthermore, the mobile consumer is generally on-the-go in contrast to the desktop consumer. In another dimension of app design, within the realm of mobile platforms, social media is scattered atop sales and marketing tactics. Mobile apps that are social can leverage consumer buy-in, e.g. rewards that can be shared on Facebook. Overall, the mobile app must improve the customer experience in some way; mobile payment is a simple technology investment that does not do anything for the end consumer over using cards, or even cash for that matter.Consumers need quid pro quo for using a mobile app. In the case of Starbucks, this means cutting and eliminating [wait] lines, the ability to order ahead, and fruition of the embedded loyalty program.
As we move towards a cashless future and the threat of card security faintly looms, mobile payments continue to proliferate. Mobile payments will continue to disrupt the business landscape, but also foster the opportunity for agile companies to outperform their competitors. By combining convenience with rewards, the mobile payments trailblazer, Starbucks Coffee Company, is showing today’s retailers how to appeal to the modern consumer. Companies that assimilate into the Digital Revolution by featuring mobile payments at the center of their digital strategy will profit and prosper from meeting the consumer where they are today.
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