Smartphones turning marketing upside down

Because of connected mobile devices such as smartphones and tablets, shopping is becoming an iterative rather than a serial process. Consumers no longer go shopping, they always are shopping.

[Reproduced from Harvard Business Review]
The Mobile Shopping Life Cycle
[by Chuck Martin  06.11.13]          

Mobile is turning "path to purchase" on its head. One of the most time-honored marketing concepts, that notion that a customer takes a predictable journey toward a sales transaction (in its earliest definition, starting with attention to a product, then moving to interest in it, then desire for it, and finally, action), has long provided the framework for marketers to strategize how to communicate with customers and exert influence. While the steps have been debated and refined over time, and the path is often now depicted as a "sales funnel" (with a large initial audience having awareness, funneling down to successively smaller groups having familiarity, consideration, purchase, and loyalty), the basic idea has remained that a customer's commitment to a purchase intensifies at each step, and so should the marketer's investment in bringing the transaction to a successful close.

Now, because of smartphones and tablets, marketers need to fundamentally rethink things. Shopping is becoming an iterative rather than a serial process. Consumers no longer go shopping, they always are shopping.

To adapt to this transformation, marketers must begin by recognizing that, in this new world of mobile commerce, the traditional sales funnel is dead. It's being replaced by something more like a shopping life cycle, in which marketers have the opportunity to influence mobile consumer behavior and purchase decisions at various key moments.

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Marketing efforts guided by the traditional sales funnel don't work in a selling environment populated by mobile devices because, for the always-on, mobile shopper, the entire shopping and buying process is both continuous and intermittent. In the old sales funnel, the shopper moved one step at a time toward the purchase and marketers targeted them as they moved closer to making the buy. With mobile, the process is not in such an organized sequence. The steps of the mobile buying process are all happening all the time. And most importantly, mobile shoppers (m-shoppers) can be influenced when they are using their mobile devices on the go.

I like to think of the mobile shopping life cycle in terms of six key states in which customers exist relative to purchases, each of which offers moments when they can be reached and influenced because they are using various aspects of mobile. (See the exhibit below.)

The Mobile Shopping Life Cycle:

At each of these six distinct moments of the Mobile Shopping Life Cycle, marketers have the potential to steer the mobile consumer toward their product and influence shopping behaviors.

The Set-Up: The Pre-Buy. This is the mobile research phase, as consumers use smartphones and tablets before they even consider going to the store. Mobile is a pull rather than a push medium. Marketers should position information and messages about their products to be pulled by the consumer according to that person's time frame, mind-set, and location.

The Move: In Transit. This phase occurs when the consumer is on the way to a store or running an errand. With new location-based capabilities, marketers can leverage information, such as smartphone location and speed, to send highly targeted and relevant messages to consumers who have opted in to receive valuable offers. Marketers will have to create value for consumers, to provide an incentive for them to leave their location "turned on" in any given app.

The Push: On Location. This occurs at a brick-and-mortar store. In the early days of the internet, brick & mortar was a detriment to business, since online-only retailers could sell directly to consumers with fewer associated costs. With mobile, brick & mortar becomes an asset. But while some retailers are leveraging the ability to interact, most are still missing the opportunity to identify and interact with mobile shoppers while they are in the store.

The Play: Selection Process. This is when customers are near the actual product they may be considering buying. With what is known as proximity marketing, marketers can use various technologies to interact in real time with customers, with the potential even to move to real-time pricing. For example, a number of customers walking by a particular product might receive a real-time offer such as a discount on it. Based on real-time awareness of inventory, the offer could be changed or discontinued before the next group walks by. Consumers already can scan barcodes on products and receive on-the-spot price comparisons with easy-to-use but sophisticated technologies.

The Wrap: Point of Purchase. Here is yet another chance to sway the buyer. As businesses adopt more mobile self-checkout options and mobile capabilities are embedded into point-of-sales systems, offers and counteroffers can be presented to consumers during the buying and checkout process.

The Takeaway: Post-Purchase. This occurs after the purchase, as consumers exchange photos, videos, and information of their recent purchase and share them via their mobile device with friends and colleagues, soliciting and receiving feedback. The challenge for marketers is to become part of the conversation at this stage.

Mobile activity in each of these six phases will continue to expand as smartphone and tablet penetration increases and more consumers join the ranks of mobile shoppers. By recognizing the mobile shopping life cycle as it emerges, brands and marketers will be in position to adapt along with its evolution, and to master the new art of mobile influence.