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Permissions and strong customer relationships critical for SoLoMo marketing to succeed, research shows

Study by data analysis firm GI Insight reveals vast majority of consumers demand companies lay groundwork before embarking on Social Local Mobile campaigns

Leicester, February 2014 - New research on Social Local Mobile (SoLoMo) marketing by customer insight company GI Insight reveals that 70% of UK consumers are only happy to receive location-based commercial messages via their mobile phone if they have given prior permission for the company sending the communications to contact them.

The study, based on a survey of more than 1,000 consumers, also shows that 58% of consumers are only open to receiving localised marketing messages on their mobiles or smartphones if they have a strong existing relationship with the brand sending them, such as membership in a loyalty scheme, while 80% are not happy for 'any old company' to send them such communications.

The most surprising finding of the research was that, despite initial enthusiasm for Foursquare, Facebook Deals and other SoLoMo-related social media initiatives, consumers are not at all favourable towards location-based marketing through social networks, with just 22% saying that receiving promotions via these sites would increase their likelihood of actually taking up an offer.

Instead, 59% of consumers say they are much more likely to take up localised offers sent to their mobile - whether by email, text or special app - if they belong to the sending company's loyalty scheme. What's more, 59% also maintain that even if they have an established connection with a company, they will not act on location-based mobile messages if they are not individualised offers that reflect an understanding of their needs and preferences.

The research report, Harnessing the power of SoLoMo, examines how receptive and responsive consumers would be to mobile messages from companies based on their current location - such as an offer of discount or a free item for visiting a shop or restaurant in an area they have just arrived at. The survey was representative of the UK by age, gender and social class and the report includes sections on gender differences, age group breakdowns and regional variations.

Andy Wood, GI Insight's managing director, notes: "These findings throw up some real red flags for brands, and some of them are surprising. For instance, not everyone is happy to be marketed to via mobile, and less than a quarter of the consumers we surveyed say that they would act on localised messages sent to their smartphones via a social networking site.

"Permissions are crucial to even get a message read and having a longstanding relationship with a brand - such as belonging to the loyalty scheme - is the real key driver behind consumer take-up of SoLoMo offers, according to the research. Consumers also demand that such localised mobile messages offer personalised, individual promotions based on what the brand knows about them. These relationships have to be built through other channels and informed by data painstakingly gathered and analysed - before any location-based marketing is even considered. SoLoMo cannot simply be a matter of casting the net out to a location and seeing if the consumer bites.

"Whilst SoLoMo can offer a unique opportunity for companies to gain a competitive edge, the research makes it crystal clear that it is not going to develop into the be-all and end-all of one-to-one marketing. It is evident that a significant proportion of consumers will never be comfortable accepting location-based marketing on their mobiles and that, for others, it is but one touch point among a range of channels that brands need to use to engage them."

For further information please contact: Kerry Lloyd Jones at [email protected] or Rhianne Muir at [email protected]; or call 020 7402 0510

Or for a copy of the report, go to: http://www.gi-solutionsgroup.com/gi-insight-knowledge-centre/gi-white-paper

About GI Insight
GI Insight specialises in database marketing and loyalty schemes, having created and managed more retail loyalty programmes than anyone else in the UK. The Leicester-based company offers a full range of database marketing services including consultancy, database design/build/host, data capture, analysis, segmentation, profiling, campaign execution and measurement, available as a whole or on a 'pick and mix' basis. The analysis and interpretation of your sales and customer data enables you to influence customer behaviour. This knowledge helps you to reliably increase profitability by:

  • Getting more new customers (acquisition)
  • Getting existing customers to:
    • Spend more often
    • Spend more per transaction
  • Reducing Customer Attrition (retention)
  • Move customer from low to high margin purchases

For more information, please visit http://www.gi-solutionsgroup.com/gi-insight

Source: RealWire

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