Retailers increase mobile marketing, loyalty initiatives
July 15, 2013

Many small and medium-sized businesses institute a mobile marketing campaign to align their advertising initiatives with mobile credit card processing and loyalty and gift card programs. According to a recent study, three-in-four mobile device users have come across an ad while utilizing their gadget within the past month. With an increase in the number of SMBs and larger retailers investing in mobile marketing solutions, the advertising strategy is set to drive merchant sales. 

Retailers identify sales opportunity
A new study from Mintel, a market intelligence provider, examined how often mobile Web users are exposed to online advertising campaigns. The study noted 76 percent of portable device owners have seen a digital ad. One reason is an increase in online marketing spending from SMBs and larger retailers. The study stated between 2010 to 2012, total mobile ad sales rose from $6 million to $3.4 billion, with a compound annual growth rate of 138 percent. Retailers are set to continue purchasing mobile marketing ads to reach local customers, with the study estimating local digital advertisement sales will increase from 2012's $1 billion to $2 billion in 2014. 

With more consumers owning a smartphone and/or tablet, retailers are investing in mobile digital marketing initiatives to take advantage of the advertising opportunity. By reaching customers on a daily basis through their portable device, SMBs can strive to increase sales and generate additional revenue. According to the study, more consumers between the ages of 18 and 34 said they viewed an online ad through their mobile gadget than members of older generations. 

Yet, SMBs and larger retailers also increased their use of digital coupons, with loyalty programs getting a boost as well. Approximately 18 percent of portable device users redeemed a mobile coupon between 2010 and 2012. The mobile marketing initiatives were found to drive sales, and SMBs should consider aligning digital advertising campaigns with loyalty programs to improve customer involvement. 

Billy Hulkower, senior analyst for technology and media at Mintel, said the growth in merchant spending on mobile ads reveals the increasing prevalence of portable electronics in the retail sales environment. 

"Typically, nascent markets related to technology show slowing growth each year," Hulkower said. "However, in the case of mobile ads, consumers will still be acquiring their first smartphones and tablets through 2015, suggesting that sales growth deceleration will not occur at the same pace that would be seen for a hardware market - instead, sales may accelerate further as the audience for mobile media expands."

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