The Retail Transformation Blog

Shopping Centres: where next for mobile marketing?

In the last two years, the opportunities available to shopping centre owners and their retail tenants to engage directly with their shoppers through the use of advanced mobile technologies have increased rapidly.

The combination of precise, real-time geolocation (e.g. through a combination of Wifi and Bluetooth beacons), smart targeting and “Big Data” analytics facilitating adaptive, context-aware messaging has changed the landscape for localised, effective marketing. But shopping centre owners still need to make further progress in making the most of this exciting opportunity.

Whilst the technology has advanced in leaps and bounds, the quality of delivery (in terms of the marketing content it is used to promote) still often leaves a lot to be desired.

Too often, the marketing messages and promotions pushed through the smartphone (via shopping centre apps) are generic offers that simply mirror what is available elsewhere; they are not effectively targeted at consumer groups that will find them compelling, and the choice between push messaging and simply allowing shoppers to find their own way to content that will be relevant to them is ignored. The result is often a disappointing level of customer engagement leading to a lack of retailer commitment to making the mobile platform “fly”.

However, the positive results of effective targeting through mobile devices can be staggering.

Case Study: At Elbe Park shopping centre in Dresden, Germany, the “Sparalarm” app is live. The platform, developed by Match2Blue, is managed by the local newspaper as a means to generate a new stream of promotional revenue, provides a portal for the scheme’s retailers to place real-time promotions targeted at the city centre’s shoppers.

In the launch week of the app, a compelling time-based discount was offered to selected user profiles for a few targeted products in the centre. The target shoppers received via push notification a relevant discounted offer of 50% off, reducing by 1% for every passing minute.

Whilst “end-to-end” conversion (i.e. from push notification to redemption) can typically be around 10% in systems actively using context-aware geo-located targeting, this specific promotion achieved a staggering 70% conversion, with shoppers typically achieving around 40% discount. These rates of conversion are far beyond anything promotions delivered through more “traditional” mechanisms (email, text, social media…) could hope to achieve, but currently they are seldom reached by mobile platforms where the quality of targeting and the marketing message is too often sub-standard.

So, why are these success stories currently the exception rather than the norm?

To be successful, shopping centre owners need to work hard not only to engage and sign up shoppers – in many ways, this is the easy part – but also to engage their tenants and work together over the long-term to help them make the most of the platform.

For many retailers, whilst in principle the potential benefits of targeted, localised marketing are well understood, in practice there are several real constraints slowing its adoption.

These include:

• Central control of marketing and promotional budget: Responding with effective promotions in real-time (e.g. relating to observed levels of in-store activity, or specific on-sale items that need to move faster) will often need decisions to be controlled at the store level; many retailers are not structured in this way, and the brave new dawn of mobile technology will need a new, more devolved approach.
• Lack of necessary marketing know-how (and available resource) at store-level: Another part of the same issue: local teams will need to be trained and empowered.
• Retailer’s focus on their own mobile platforms: A shopping centre app should not be seen to compete or conflict with a retailer’s own mobile proposition; whilst a retailer can use its app to engage directly with existing customers, a shopping centre owner can open the door to new customers
• Poor relationship with landlords: Effective mobile marketing in shopping centres requires a true partnership between landlord and tenant sharing information and insight; heated debates over rent renewals and service charges may not foster this environment.
• Concern over data privacy: This must be paramount in how shopping centres engage with their shoppers; maintaining a transparent, open relationship with shoppers, and developing apps where the user is in full control (e.g. through settings) is the way to go here.

Shopping centre owners need to be sensitive to these constraints and work hard to address them.

So, here is Javelin Group’s 12 point checklist of how to achieve best practice in the use of mobile marketing apps in shopping centre environments:

1. Have we accurately calibrated our geolocation technology to ensure it is giving a true representation of movement through the shopping centre?
2. Are we engaging actively with our tenants to help them get the most out of the mobile platform? (e.g. sharing best practice, sharing tips for success?, sharing case studies?)
3. Have we developed an easy-to-use platform for adding new content with the appropriate level of security, access hierarchy and quality control built in?
4. Are we ensuring an appropriate level of targeting is used in sending content to shoppers to ensure that the messages they receive remain relevant and compelling?
5. Do we allow our shoppers to share what they love about the shopping centre and the promotions through social media?
6. Are we measuring the impact of campaigns (e.g. adopting AB-testing principles)?
7. Are we adjusting future campaigns in light of the insights generated through analytics?
8. Have we explored the data being produced by our mobile platform to identify and exploit additional areas of insight? (e.g. heat-maps, store visitor conversion levels, catchment areas etc.)
9. Have we explored synergetic external partnerships which could generate incremental revenue and help fund the platform and deliver a new income stream for the centre?
10. Are we monitoring the app features that our shoppers find most useful? (e.g. wayfinding, promotions, events, local information)
11. Are we keeping one step ahead of other platforms targeting local shoppers?
12. Do we have a clear plan for evolving our mobile proposition so that it remains compelling?

If you find yourself answering yes to fewer than seven of these questions, then it suggests there is still much work to be done into making the most of your app; answer yes to seven or more questions and you are probably at or close to current industry best practice.

But of course, this area of mobile data and marketing is moving very fast, and best practice of today will tomorrow be a “hygiene factor”.

The next generation of actionable insight in this arena is already on the horizon, as businesses such as SAP, Telefonica and EE bring to market a rich seam of data from the anonymised tracking of mobile phone users.

This will add a new layer of understanding relating to the movements and profile of visitors to a shopping centre. Whilst this will revolutionise the way in which shopping centres understand such key dynamics as catchment areas, shopper profiles, competitive leakage and flow patterns, it will bring a new set of challenges as owners seek to understand the commercial actions that this deeper knowledge can help to trigger.

For further information, please contact Robin Bevan.

FIND OUT MORE about Javelin Group’s Shopping Centre Strategy service line.

*‘First published in Essential Retail