Category Archives: mobile commerce

#mcommerce- how to use QR codes effectively to connect online with offline

Online and offline are merging. We engage with prospects and customers in different ways during the lifecycle of their relationship with a brand: in the search and prospect phase, at the point of purchase (or initial conversion) or during the after-sales and support cycle.

One way to easily get to grips with the different ways you can interact with audience is to break down the user journey.

For the initial stages, the get in touch and get engaged phases, you need to have a strategy in place to get visitors back to your site to re-engage with them, especially if the initial contact was in an offline situation.

There are many ways of doing this but a good strategy is to become pragmatic and ensure you can run a campaign that takes hours to implement, instead of days.

Enter the QR code

QR codes are becoming very popular, even though they might still need further development to generate the results marketers expect.

There are a few that argue there isn’t a role for QR codes in engaging potential customers,but until other means of technology are established I think the use of QR codes in driving visitors to your website is one that has real benefit in linking offline and online.

As they are easy to generate, there has been a proliferation of QR codes everywhere, but not all of them are as effective as others. Here are a few pointers to keep in mind to ensure effective ROI when using QR codes:

1. Think surrounding

Take the physical surrounding into consideration when you plan your campaign offering. What do you know about the setting the person will be in? Where are they and what will they be doing?

Using a QR code on a billboard on a busy high street may be a good idea but placing it in an elevator with bad Wi-Fi or 3G connections will not work. Think about the external environment that your target audiences are in and whether taking out their phones and scanning a code is physically possible or convenient for them.

Avoid mistakes like this. This banner placed above the entrance to Manchester town hall cannot be scanned without a ladder..

2. Think mobility

You know that they are going to access your content from a mobile device. Make sure that your content and process is mobile enabled, and that it is easy to move along the conversion funnel to avoid drop offs.

Navigation and user experience is important. Our research last year showed that 35% of consumers think mobile sites are often missing important functionality.

You do not want to run a campaign that is geared to the mobile and then the content is limited in the mobile channel, especially if you are using QR codes for mobile commerce.

3. Think personalisation

Personalise the content for each unique visitor. Use the preferences of the visitor, where they are (geography) and the context, then share your offering based on that.

This is where it can become a lot more engaging for potential customers. For example, if you are using QR codes for an event, maybe you can adapt the offering based on when the person accesses the site and tie it with product or service offerings that are useful at that time of the day.

A great example is Turquoise Cottage, a popular night spot in New Delhi, India, which has cleverly used QR codes to promote drinks offers and a taxi service:

You have to help the visitor here, so knowing your target audience and how they want to interact is key to success. Personalising the landing page is a key element (which I have blogged about previously.

4. Think social

Can you use public social networks to run competitions and extend the user journey?

Check-in and location based services can add a lot to a campaign and the possibility to interact with the user over time. A word of caution here is to not make it dependent on having a login as that can limit the number of participants in the campaign.

One of the best examples that I have seen that ties together all of the above elements, is Tesco’s use of QR codes in South Korea. Get inspired!


Why retailers need to embrace mobile internet in stores


It’s natural that some retailers will feel threatened by the growing use of mobile in store, but the answer is to embrace this trend and use it to enhance the in-store experience. 

Retailers can do this by providing apps and mobile optimised sites, but also by offering wi-fi to customers.

According to an On Device Research (ODR) survey of mobile users, 60% of respondents have used the mobile internet while in stores, while 78% would use free wi-fi in stores if offered it.

The use of smartphones by consumers is growing, and many are now using them to compare prices, and search the web for product reviews.

So how can retailers adapt and use this customer behaviour to their advantage?

Mobile use in retail stores

There are now plenty of surveys which show the growth of mobile usage in retail stores:

  • An iModerate survey found that more than half of smartphone owners are using the internet in stores, with price comparison, checking store locations, and hunting for discounts the most common reasons.
  • Our Mobile Planet data sees 24% of UK smartphone owners taking their phones shopping with them in order to compare prices and inform themselves about products.
  • A Toluna/Econsultancy survey from May last year found that 19% of 2,000 online respondents had used their mobiles to compare prices and look at product reviews while out shopping.

Why do consumers use mobile in store?

There are two main reasons:

Price comparison

This is usually the main purpose of using mobile in stores, which makes perfect sense. The state of the economy means that customers are more price sensitive than ever, and mobile is the perfect tool for the job.

What’s more, there are often huge savings to be made. If I’m looking at a TV in an electrical retailer, it’s quite possible I could save £100 by checking for the same product on Amazon.

Looking for reviews

This is another common reason to reach for the smartphone when in store, and this is a behaviour that high street retailers should encourage.

Checking for a review of a product is a sure sign of purchase intent. It means they like the look of a product, and are perhaps just seeking some reassurance.

The threat for retailers

The problem for retailers is that, whatever the quality of service in store and the range of products on offer, shoppers always have the option of checking prices on their mobile phones and heading online, or to another high street retailer to make the purchase.

This ‘unbundling of the shopping experience’, and the threat from online retailers is described in detail here by Ashley Friedlein.

There are a number of mobile apps and websites that enable in store shoppers to check and compare product prices, but Amazon’s mobile products represent possibly the biggest single threat to offline retailers.

Using the barcode scanner on the app, customers can easily check the products they are looking at in store on Amazon’s site.

Since Amazon is often cheaper, with a variety of delivery options, this can pose a real threat.

How can offline and multichannel retailers meet this challenge?

Don’t block internet access

I’ve seen a few stories around, which are difficult to substantiate, about retailers attempting to put obstacles in the way of customers with smartphones.

This could be counter-productive, and is certainly not the kind of tactic a forward-thinking retailer should be using.

Offer reviews at the point of sale

Retailers with reviews and ratings on their websites can easily bring this information into stores to help push products.

If a digital camera is recommended for the casual photographer, and has an average review score of five stars from 35 reviews, why not use this information?

I like the recommendations that can often be found in bookshops and wine merchants, which have been written by staff. They can help customers decide what to buy, and also have a personal touch that can appear more trustworthy.

In the same vein, retailers could combine online opinions with staff recommendations and other third party reviews.

Make sure you have a mobile site or app

If customers are going to pick up their phones and look for reviews, persuade them to use your site for this. Promote it in store. 

If you can provide the reviews they need, then customers won’t have to use competitors’ sites where they might find a better deal.

Better still, provide them with a link on the store shelf where they can find reviews, or maybe a QR code or barcode to scan and view further information.

Comet provides a great example of this with its recent barcode scanning app. The purpose of the barcode scanner is not necessarily to allow price comparison while in competitors’ stores, though I’m sure Comet won’t mind if customers are doing this.

Instead, the main purpose is to make it easier for customers to see enhanced information on products on the shopfloor.

Comet promotes this in store, and the site and app have some very comprehensive product pages replete with reviews and expert buyer’s guides, allowing customers to access this information when they need to see it.

Better still, it means they don’t have to visit Amazon to find out.

It works too. Mobile now accounts for 10% of Comet’s traffic, and the retailer enjoys an advantage in this area over multichannel rival Currys/PC World.

Mobile vouchers

For retailers that offer voucher codes online, allowing these codes to be redeemed in-store is one way to increase footfall, and maybe do some cross-selling when they arrive.

In conjunction with wi-fi, retailers could even target customers when they are using their mobiles in store.

NFC / mobile payments

NFC technology is yet to capture the public imagination, but it does give consumers another payment option for those times when they suddenly realise they have forgotten to get cash out and they are already at the cash register with their shopping.

Make sure they can access the information they need

This is where wi-fi comes in. It’s about making the mobile experience easier for customers. Instead of relying on variable 3G connections, providing internet access means they can browse reviews, scan QR codes, and use AR apps like Blippar to their heart’s content.

Let’s say a customer wants to see a review. If their 3G signal is poor and they can’t find what they want, will they still buy that camera?

Providing wi-fi means that they can easily access the information, while it also allows them to download your own app.

Wi-fi and efficient customer targeting

Wi-fi in store also provides a way to capture customer details and target them with offers. In fact, customers would be willing to receive some offers in return for the convenience of decent wi-fi.

Tesco recently introduced this in its larger stores. It does require a slightly clunky registration process which involves entering clubcard numbers, but the retailer is then armed with your purchase history. If Tesco can sweeten this process with a discount or two, it may well be worth the effort. 

According to the ODR survey embedded below, 74% of respondents would be happy for the retailer to send a text or email with promotions.

They’re in store, when better to sell them breakfast cereal or push a promotion? 

House of Fraser recently ran a promotion in conjunction with O2, using free wi-fi, which aimed to drive incremental sales in the run up to Christmas. John Lewis recently added wi-fi to its stores.

In an excellent guest post from last year, Dave Wieneke looked at how mobile can be used to enhance the in-store experience for consumers, as well as providing retailers with some precision tools to target the mobile customer.

A blend of location and personalisation can make life easier for customers, while allowing retailers to target customers with relevant offers and recommendations.

One great example of this came from the French Casino supermarket chain. Its iPhone app allows users to compile shopping lists before heading to the store, where they can use their mobile to scan and pay for items in store.

This is useful for the customer, but also provides the retailer with a wealth of information of the customer’s preferences and shopping habits.

Combine this with technology like Tesco’s in-store ‘sat nav’ app and you have the ability to target customers in real time, according to their location.

Let’s say the customer is entering the dairy aisle. They bought a particular brand of butter last week, and there’s an offer on that this week. It’s just five yards away.

Customers already have the smartphone and tablet technology in their bags and pockets that makes this possible, it’s just a question of adapting to this and making it easier by providing wi-fi.

Mobile isn’t going away, and the retailers that adapt to this trend quickly and use it to improve the customer experience will have a big advantage over their competitors.  


Android Market Growth…watch out Tim Cook

Is tap-and-pay transit the key to m-commerce adoption?

Digital marketplace eBay reported its third quarter earnings on Wednesday, trumpeting revenues of $3 billion–a 32 percent year-over-year increase. eBay CEO John Donahoe credited the jump to the company’s fast-growing mobile commerce efforts: “We expect eBay mobile commerce to generate almost $5 billion in merchandise volume this year and PayPal mobile to exceed $3.5 billion in payment volume,” Donahoe saidin a prepared statement. “Mobile is one way online and offline shopping are blending into a single commerce environment. We are focused on enabling commerce, helping consumers shop anytime, anywhere, and being the commerce partner of choice for retailers of all sizes.”

But mobile commerce is about more than just buying stuff. That was the central theme of American Express group president of enterprise growth Dan Schulman’s keynote speech at last week’s CTIA Enterprise & Applications 2011 conference. Schulman outlined an m-commerce model encompassing retail transactions as well as mobile coupons, offers, loyalty programs and related marketing tools. “There’s no longer a difference between online commerce and offline–with my smartphone, I can have exactly the same information overlay in front of me as on the desktop,” he said, noting that consumers can now access product information, pricing comparison data, recommendations and special offers. At the same time, Schulman said, merchants and marketers can leverage mobile devices to deliver and track more customized offers to consumers who opt in for in-store promotions.

“Mobile payments are not about tapping phones at the point of sale,” Schulman said, plainly referring to nascent tap-and-pay initiatives like Google (NASDAQ:GOOG) Wallet and Isis. “That’s interesting, and it may be good for consumers, but it’s going to take some time to be compelling if that’s all mobile payments are about.”

As if in response, Google significantly expanded its Google Wallet initiative this week, making it clear that retail purchases are just one facet of much larger ambitions. In addition to using their Nexus S Android smartphones to make purchases at 300,000-plus MasterCard PayPass-enabled merchant terminals, consumers may now redeem coupons and/or earn rewards points at select U.S. retailer partners including American Eagle Outfitters, The Container Store, Foot Locker, Guess, Jamba Juice, Macy’s, OfficeMax and Toys”R”Us, with no paper coupons or loyalty cards necessary. In addition, Google Wallet’s Featured Offers tab now boasts exclusive discounts from American Eagle, The Container Store, Macy’s and Jamba Juice. Google is also working with Chevron, D’Agostino, Faber News Now, Gristedes Supermarkets and Pinkberry to equip their stores to accept Google Wallet transactions as well.

No less significant, Google Wallet is moving beyond the retail segment altogether: Google is partnering with the state of New Jersey to enable tap-and-pay rail and bus transit purchases at select locations. NJ Transit is the first public transportation agency to announce support for Google Wallet–commuters may leverage the application to buy tickets at New York Penn Station ticket vending machines and ticket windows as well as Newark Liberty International Airport Rail Station (AirTrain). NJ Transit will also offer Google Wallet ticketing on bus routes 6, 43, 80, 81, 87 and 120, and on some buses on the 126 line. (NJ Transit adds that its public-private partnership with Google was developed at no cost to the agency.)

If you live in a large metropolitan area, chances are you rely on public transit at least a few times each month, if not more often–it’s easy to envision how much simpler life could be knowing you could hop on a subway or train and pay your way via smartphone regardless of whether there’s cash or an active fare card in your wallet. Google knows it, too: “Transit is the fastest way to accelerate adoption and reach usage density in major urban centers by habituating the behavior of tapping and paying with phones,” said Google vice president of commerce Stephanie Tilenius in a statement. eBay may be the first prominent company singing the praises of m-commerce in its quarterly earnings, but it won’t be the last.


The Complete Guide to Freemium


The idea of offering your product or a version of it for free has been a source of much debate.

Pricing is always tricky. Unfortunately, many entrepreneurs don’t give it enough thought. They will often copy the pricing strategy of similar products, base their decisions on pompous statements made by “experts” or rely on broken rationale (we worked hard so we should charge $X).

Free is even trickier and with so many opinions about it, we thought it would be refreshing to take a critical approach and dive deep into why some companies are very successful at employing the model while other companies fail. We’ve looked into economics academic papers, behavioral psychology books and strategies that worked for companies to come up with the key concepts below.

The Law of Marginal Cost

Pricing plays a huge part in competing for customers. Here’s an economic law that holds almost as much truth as the law of gravity: in a perfectly competitive market, the long-term product price (aka “market clearing price”) will be the marginal cost of production.

Guess what? Because of declining hosting and bandwidth costs, for most Internet products the marginal cost today is practically … zero.

In other words, if the cost to serve a customer (support aside) is zero, the long-term price of the product in the market will be zero (because of competitive pressure).

An Experience Good

At the core of the “Free” models are the products or services being offered to the customer. Most Internet products or services fall into the definition of an Experience Good: a product that needs a period of use before the customer can determine the value they can derive from it.

A good example is Dropbox. Consider Drew Houston’s words: “The fact was that Dropbox was offering a product that people didn’t know they needed until they tried.”

There are plenty of academics who looked into the pricing of Experience Goods. In 1983, the Economist Carl Shapiro wrote a fascinating paper about this subject. His conclusion was that since customers tend to underestimate the value of a product, the optimal pricing for an experience good is a low introductory price which is then increased when the customer realizes the value of the product.

In some cases, a customer might overestimate the value of the product. In that case, the optimal pricing strategy is to charge as much in the beginning or to lock in customers with long-term contracts.

This is why customers are reluctant to buy when someone asks them to prepay for a service or product or sign a long-term contract.

Hence, the introductory price is a signaling mechanism. The conclusion?  A low entrance price signals that you are confident that your product will create value for the customer.

The Psychology of Free

Much has been written about the Psychology of Free. Two books that looked specifically into the subject are “Free” by Chris Anderson and “Predictably Irrational” by Dan Ariely. Putting it simply, Free is an emotional hot button that immediately reduces the mental barriers for the customer. Free makes people think that they have “nothing to lose” since many ignore time as an investment.

From this perspective, free is a huge accelerator of adoption. The flip side of this is that after using the product for free, it is very hard to get the customer to start paying for it. This phenomenon was broad enough to get its own name: “The penny gap”—the hardest part is to get your customer to pay you the first penny. This is why it is so critical to choose your premium features wisely.

Decision Factors

If all that is true, it seems like Free (or Freemium) is the answer. Well…. not so fast. The decision is definitely not easy. Here’s a basic framework to help you make a more informed decision. A word of caution though: for every complex problem there’s a simple solution … and it’s wrong. The framework is helpful as a thinking tool but there’s no magic formula.

Here’s a set of questions that you’ll need to ask yourself:

  1. How big do I want my company to be? If you are looking to build a lifestyle business that’ll make you $8,000 a month and you have a good product, you can probably do without Freemium. If you want to build a dominant company that has a substantial market share, Freemium can help you accelerate adoption.
  2. What is the value of the free users? Across all successful Freemium companies, there is a way of making money or saving money from the free users. Either by saving on marketing costs (Dropbox) or by making money from ads or data (Pandora, Evernote, Mint) or both. If you cannot turn your free users into savings in marketing costs or revenues from third parties—figure out how!
  3. What is the cost to serve free users?  This is a critical aspect of the model. If you spend a lot of money and/or time servicing free users, you are going to lose a lot of money. The cost of servicing free users must be lower than the dollar value they provide.
  4. How big is my market? “The easiest way to get 1 million people paying is to get 1 billion people using,” says Phil Libin, the CEO of Evernote. Free adds another conversion step on your way to revenues. You need a big market to have enough people who will be paying you at the end of the day.
  5. Is there value to one customer from other customers using the product? This will determine how many new users the free users will refer. There are three levels of value:
  1. Inherent value – You can use Skype only if the person you talk with also uses Skype. You can share a Dropbox folder only with other Dropbox users. In this case, Freemium can be a powerful strategy.
  2. Added value – You wouldn’t want to be the only user of LinkedIn. You derive value from other people using it. In this case, Freemium can help you gain traction if you use an effective invitation mechanism.
  3. No value – You don’t care if someone is using Evernote or not. The only reason for one person to tell another about the product or service is if they think it is awesome.

The Types of “Free”

One of the key factors in making Freemium work is the structure of the offering. What is it that you offer for free vs. charge? There are different types of free strategies. Let’s take a look at the popular ones:

  1. True Freemium – Give a version of the product for free and charge a fee for the other versions. There are two ways to go about this:
  1. Value based – The most successful type of Freemium strategy. The more a customer uses the product, the more value she derives, the higher the switching costs are, and at some point she’ll hit a usage limit and convert to a paying customer. Evernote and Dropbox are beautiful examples of this.
  2. Characteristic based – For example offering the product for free for one user (so it is based on company size for instance). Let’s think about a B2B application. If I’m a freelancer, I will use the application forever and I will never have to upgrade. If I’m a 3-person company, I can’t add more users and try the application for real and hence might not get to the point where I see the value in using it.
  3. Free Product for a Cross Subsidy  – Give one product for free and charge for complementary products.
  4. Time Based Free Trial – Give a free trial for X days and start charging once the trial ends. The issue here is figuring out what X is. On one hand you want to create a sense of urgency, on the other hand you need the customer to see the value in the system.

Open Source as a Free model

Lately I’ve seen many entrepreneurs confuse Open Source with Free so I thought it would be helpful to make the distinction. An open source model can definitely accelerate the distribution of your product and is a viable free model. It has two main advantages. You might get developers to contribute to your product (see WordPress). By doing that you can accelerate the development of your product. The other advantage is that you give customers peace of mind as they have control over the source code. You can then make money from selling pro features or value added services. There’s a critical distinction here and that is that your code is out there and anyone can start a company to commercialize this code. Bear in mind that it is very hard (often impossible) to reverse a decision to open-source.
The Last Bit And The Secret To Success

There are many factors to consider when you are evaluating whether to use the Freemium model or not. However, there’s one last secret that I didn’t share with you. During the study, while looking at the successful Freemium companies, a pattern emerged. They all had phenomenal products. All of these decision factors are useless if the product or service you are offering is nothing short of amazing. If your product is not creating great value for its users, no tactic in the world will make Freemium work for you.


McDonald’s firms up mobile strategy to drive in-store traffic

Fast food giant McDonald’s is making a bigger play in the mobile space with the launch of a new application that drives consumers to the nearest location and illustrates the company’s commitment to offer improved nutritional choices.

The mobile app is part of a national marketing initiative that includes a long-term plan, which features ongoing menu evolution and nutrition awareness communication. The app is available for free download in Apple’s App Store.

McDonald’s is the world’s largest burger chain, serving nearly 47 million customers daily.

Food for thought
The McDonald’s app features a restaurant locator and nutrition information.

Hungry consumers can search for the nearest McDonald’s location by entering their ZIP code.

Customers can also search restaurants by state.

After finding the closest location, consumers can browse a map and find directions on how to get there, view employment opportunities, send comments, view a calendar of events and email the manager.

Customers can also see the location’s hours.

Additionally, the app lets consumers view nutrition information.

Customers can browse nutritional information by category such as sandwiches, french fries, breakfast or any of the McDonald’s McCafe drinks.

There, consumers can browse calorie, protein, total fat and carbohydrate information, amongst others.

The McDonalds iPhone app

Consumers can find the nearest location

Mobile jobs
The app also features a careers tab for consumers interested in applying for a job at the company.

Interested applicants can view a video that highlights McDonald’s employees and how potential employees can grow with the company.

Consumers can also search available positions via the app.

Source: Selects BlueCava Device Identification Technology to Enhance Mobile Targeting Capabilities and Combat Lead Fraud, a marketing communications firm headquartered in Tempe, Arizona, and BlueCava (, the leading provider of advanced technology that enables businesses to identify and profile the devices used by their customers, today announced a strategic partnership to embed BlueCava’s Device Identification technology into its newest mobile lead generation platform.’s new platform offers a Cost-per-Lead (CPL) format through which advertisers and publishers converge to buy and sell live inquiries via the mobile web. BlueCava’s Device Identification Platform is a patented technology that identifies internet-connected computing devices and creates a permanent, unique fingerprint for each. Embedding device fingerprinting capabilities into MobileLeads’ lead generation platform will enable clients to benefit from more sophisticated mobile ad targeting and a way to significantly prevent lead fraud.

“Our clients rely on’s lead generation platform to generate targeted, real-time inquiries from consumers browsing the mobile web. We saw a huge advantage in offering our advertisers a technology that will help to not only verify every high-quality lead, but also to enhance audience targeting in each mobile campaign they deploy,” said JT Benton, Chief Executive Officer at

“ was wise to arm its clients with BlueCava’s device ID technology,” said Jim Misuraca, Vice President of Channel & Partner Sales at BlueCava. “Having access to both real-time and historical data about devices participating in any touch point of a mobile ad campaign helps advertisers quickly identify trends and more accurately spot anomalies.”