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Consumers are Checking In to Retail Stores

In my previous blog I pointed out that that retailers were not adopting strategies for check in location based marketing. In the blog prior to that I quoted Comstat research that shows that in the first 3 months of this year 16.7 million people check into locations using Foursquare and similar applications, representing 7.1% of the total mobile population. I don’t know what the statistics are for New Zealand, but I suspect the numbers are somewhere between 5 and 7% of the NZ mobile user population.

Comstat also came up with some interesting statistics about the demographics of those users.

Firstly a lot of people think this is technology for men, that they are the geeks, but of course women love to shop, they are social shoppers and as the graph shows, there are in fact more women than men checking in!

The predominant age group should be no surprise, we would expect 18-44 year olds to be the most tech savvy and of course having disposable income for Smartphones which are the predominant mobile used for check ins. Again from Comstat for the first 3 months of this year in the USA Android pipped Apple at 36.6% to 33.7$ of devices used for checking in.

The largest group of users were in full time employment 46.6% and the second largest at 23.3% were full time students.

Just as a footnote to my blog on Group Deals and Bricks and Mortar Business there was an interesting story in eMarketer a couple of days ago. The story contained statistics that from research by Cooper Murphy Copywriters in July this year, 82% of Groupon users expressed dissatisfaction with the level of repeat business they generated from their campaigns and 49% would not use them again. This is interesting when many companies use daily deal type promotions to introduce new customers to their stores.

Of course you know where I am going with this series and that is that Location or Proximity Based Marketing offers far more compelling tools for retailers and other destination businesses to entice people into their premises. Obviously a fundamental component of that is not just how to get them to come to you, but how to get them there when you want them and to have them purchase or consume products or services that achieve your goals. For a retailer that might be those same products you were quitting on a daily deal, but like the Auckland superette owner who has been selling milk at 10 cents below cost as a loss leader, part of the strategy behind that is the opportunity to merchandise other products those same people will buy with a healthy profit margin. If you have an aged stock problem, location based marketing can get people into your store and while they enjoy the low price of your distressed inventory, put something at eye level in from of them that increases the profit of your sale. Cherry pickers do not make you profit.

Likewise if you have a cafe or restaurant, don’t just offer a free coffee with $5 worth of food. Offer it only at times when your business is empty and not to the people who were coming in anyway, they are dealt with using your normal loyalty program. Of course loyalty marketing is also very important and fits into location, but you’re going to have to come back to a future blog for that.

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August 11, 2011 Posted by | Android, Auckland, Business Intelligence, Check Ins, competition, Distribution, foursquare, iphone, lbs, location based services, map tools, Mapping Applications, Marketing, Mobile maps, new zealand, proximity based marketing, Retail, Retail Profit, ROI, Sales, software, Uncategorized | , , , , , , , , , , , , , , , , , , , , , , , | Leave a comment

Retailers are not flocking to take advantage of free check in marketing services

I did some research looking for New Zealand business success stories with check in marketing. I really struggled to find any. I went and visited a number of businesses in retail and hospitality and most of them didn’t know what foursquare was. One gentleman in a cafe told me he knew about it, but was too busy to learn how to do it. I pointed out that it was really easy, but he said he really didn’t have time and then sat down to have a coffee with one of his customers. I understand on further research that this is how he keeps a loyal clientele which is great, but he could always find a student or someone else to do it for him.

I spoke to a number of people in retail that gave me a similar story. It seems, as is often the case that most managers are too busy working on their business to work in it. This is a trap in my humble opinion. It’s common knowledge that businesses like cafe’s and restaurants to name a couple, change hands about every 18 months, a classic bell curve that starts with ambitions and energy, hard work, great service and develops cash flow. Then they get into a pattern or flow of how they do business, stop innovating, perhaps stop having fun and start telling themselves how hard business is. When they started fresh, people enjoyed the new business, new products and faces and the passion flowing from the owner and staff.

The thing is, we have an amazing opportunity to capitalise on location here. Remember the old rule of successful retail “Location, Location, Location”? Well it isn’t enough to stay fresh these days. As consumers we are spoiled for choices and sometimes we need a push to either stay loyal, or to try something new. Location Based Marketing is as simple as going to foursquare and claiming your business. To be honest, claiming your business can be a little difficult in New Zealand from a validation perspective if you are in a non residential street (where NZ Post do not deliver mail) and I have tried to contact them about this, but you should persist.

The great thing with foursquare for now is that they provide you with lots of very easy ways to set up promotion. You really don’t even have to be marketing savvy, it’s all laid out for you. Go and have a look and check  out the Manager Tools. It is so easy. If you need more help, follow this blog and we will explain how to do it.

People are checking into your store and stores near you all the time, why not give them a reason to come into yours, unless you have more customers than you can deal with. The numbers of people using check in services is growing greatly.

Have a look at the bell curve above and imagine this is your business. How long have you been in business? Have a look at your financials, now see if you can plot them on the curve. Is business growing? Are you on the rise? Have you peaked, would you like to keep the rise going? If you are reading this, maybe you have made some time to work on your business, which is great. Know someone in business who could use a little help? Tell them about this blog. There is more information coming on how to do these things.

If you are already using check in services for your business, we would love you to leave a comment. If you are part of a chain or collaborative group and are not currently doing anything in this area, or and agency wanting ideas for your client, GeoSmart would love to help point you in the right direction. We don’t create loyalty applications, but we have business partners and clients who do. We also welcome questions.

I’ll leave you with a link to an article on BusinessDay News which suggests that Location Based Marketing could be worth US$6.2 Billion within a few years. Maybe there is something to it? Would you like a slice?

August 7, 2011 Posted by | Business Tools, Check Ins, competition, Distribution, geosmart, lbs, location based services, Mapping Applications, maps, Marketing, Mobile maps, new zealand, proximity based marketing, Retail Profit, Sales, social networking, Uncategorized | , , , , , , , , , , , , , , , | Leave a comment

Group Deals and Bricks and Mortar Business

The number of one day deal sites in New Zealand grows every day. There are dozens of them and many of them now have a separate site for each region with deals for experiences, dining, accommodation, attractions and activities. This is great for bargain seekers, but doesn’t necessarily do a lot for bricks and mortar businesses.

There are scenarios where they have value, for example if a business has very large volumes of aged stock that they need to quit. It can also be useful for new businesses to make customers aware they exist. They also come at a price. The more powerful the site, the more they charge with fees being anything up to 40% of the sale of each item.

If you want to attract new customers to your bricks and mortar store, then obviously you want a coupon or something that needs to be taken to the store for redemption. Even if you are quitting aged stock, there may be advantages in getting people into your store in the hope that they will purchase other products while they are there. There are also benefits to both the customer and the retailer in not having the time, packaging  and distribution costs in delivering product to the buyer. More on this in future blogs, looking at check in applications as opposed to group deals.

A study by Rice University found that  32% of businesses surveyed who used Groupon for promotions said they were unprofitable and 40% said they would not do it again. A major issue cited in the research was cannibalising existing business. Mashable quoted a statistic that less than 20% of people who purchased deals where they had to go to a store to redeem them, returned subsequently to buy full priced product.

So the question which I will come to in upcoming blogs is how to get people into your store at quiet times and more often. I believe the answer is in locations based services such as check ins and proximity based marketing. I welcome your experience or opinion on this.

July 21, 2011 Posted by | Business Tools, Check Ins, Delivery, Distribution, lbs, location based services, proximity based marketing, Retail Profit, ROI, Uncategorized, university | , , , , , , , , , , , , | Leave a comment

Crossing the Chasm with Mobile Marketing

Location is everywhere. A large number of people now use mobile phones which are location aware through a number of technologies, most well known are GPS and GPS Assist. Some location based technologies such as car navigation are now well accepted, so the market has a general understanding of the concepts.
There is a chasm between people who use this technology regularly because they are in key industries where the applications have been adopted as a matter of course such as people in ICT and Marketing. Many bricks and mortar businesses such as retail, hospitality and tourism are only barely aware that these technologies exist.
Effective use of location or proximity based marketing solutions can have a significant impact on the profitability of many bricks and mortar companies who not only have to compete with each other, but also with Internet based retailers and wholesalers.
There are many existing applications such as Foursquare, Facebook Places, Gowalla and more which can be used by these businesses, however most business managers are unaware of the technologies, intimidated by them and to busy working in their businesses instead of on them. This presents significant opportunities for developers and the businesses themselves to take an early adopter advantage. It also displays a need for market education as to the technology and how to use it in each unique business. GeoSmart of course has web services and API’s that developers can use to create their own apps, particularly in New Zealand and Australia.

I will be exploring these issues over the coming weeks on this blog. Please bookmark or use the RSS feed if this is of interest to you.

July 4, 2011 Posted by | Australia, Australia Maps, car navigation, driving, driving directions, education, geosmart, gps, iphone, lbs, location based services, Mapping Applications, Mobile maps, navman, new zealand, proximity based marketing, satnav, software, tomtom | , , , , , , , , , , | Leave a comment

Route Optimisation for Retail Deliveries Return On Investment Part Two

In my previous blog I talked about the immediate dollar benefits of reordering your retail furniture deliveries so that you would drive the least distance, saving both time and money. I gave examples of actual returns using GeoSmart’s Route2GO Lite application which is designed for anyone to use. In other words, you don’t need to be a computer geek to be able to use it. You need to understand your business.

I gave the example of getting up to 1200% ROI on a single run and this is genuinely achievable. But there are so many more benefits to be had. Lets have a look at some of these.

First if you combine the knowledge of how long it is going to take to get from the shop or warehouse to each customer, you will be able to work out how much work the vehicle can do in the trip or in a day. This has a number of benefits. Firstly it provides clarity for sales people and the sales counter of what deliveries can be achieved in a day. Imagine if a customer came into your shop wanting to buy a bedroom suite as they have guests coming in the weekend. If you can’t guarantee delivery, your store loses the sale. That being the case, the sales person loses commission, your competitor gets your sale and the would be customer will be telling people not to visit your store, even if you have great product for a great price.

In the optimised example below, we have identified not only the driving time for each job, but based on experience, how long the driver would typically be on site unloading the truck and carrying the product into the customer’s home or premises. This is of course very important when planning the entire day.

The next thing that is really important for consumers is some sort of certainty as to when the truck will arrive with their treasured new purchase. They want the experience to be gratifying and they don’t want to be waiting around in the morning for someone who isn’t going to arrive in the afternoon.

Now you can actually provide some clarity. you wouldn’t of course tell Mrs Smith that her new bed will arrive at 9:43 AM, but it would be fair to say it should arrive between 9:30 and 10:30 or perhaps 11AM allowing you to under promise and over deliver. She may have had to take time off from work to be home for the delivery. We always hear complaints about delivery people who don’t turn up when promised and the flush of excitement can quickly turn into anger and frustration.

Deliver as promised and you don’t just have a happy customer today, you have a customer advocate who will be back at your store next time she is open to buy furniture and will be recommending you to her friends. People don’t buy furniture every day, but they may do so dozens of times during the lifetime of your business. There are loads of stories showing that people favour service ahead of price, so these repeat customers will also possibly be very profitable customers who will haggle less and make a decision more quickly because they like and trust your business.

Of course the delivery people will be much happier too. Who wants to deliver to a customer who is telling them off for not arriving on time. They are just doing their job, probably what they have been told to do. They don’t need to have their day soured by unnecessarily unhappy customers.

Because we know the order we are going to do the deliveries in, we can also produce a document that tells us how to load the truck in reverse order.

Lets face it, furniture is heavy and it makes a lot of sense to handle each item once onto the truck and once getting it off. There’s no benefit in having to move things around every time the truck stops, its inefficient, hard work and wastes time.

A list like this makes life easy for the truck driver and also for the warehouse staff, ensuring that all items get on the truck in the correct order. All it actually is, is the delivery list in reverse order. That’s what this is ultimately what this is about. It’s not rocket science, yet we do need a computer to work out the optimisation because the driver doesn’t know every one way street, no right turn, median strips where the truck can’t do a U-turn.

So now we have paid a few dollars to use this application on the web. We can see that we have enough resource to do some more deliveries if we get some more sales, which will inspire confidence in the sales staff. You get happy loyal customers who will come back and spend more with you and tell their friends to do the same. You can provide a better service than your competitors and your staff will be happy in their work knowing that their day will be less complicated and they will have happy customers.

The best part is you don’t have to take our word for it. Give us a few of your old runs in the order that you did them in and we will optimise them for you for free to prove our point. No cost, no risk, no obligation. You have nothing to lose and everything to gain. Why not contact us now?

October 1, 2010 Posted by | Delivery, driving, Freight, Furniture Delivery, geosmart, location based services, map tools, maps, Marketing, new zealand, Retail Profit, Return On Delivery, ROI, route optimisation, Route2GO, Sales, Uncategorized | , , , , , , , , , , , , , , , , , , , , , , , , , , | Leave a comment