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Too many luxury brands rely solely on apps for mobile strategy

December 21, 2010

Too many apps, not enough mobile Web browsing

Luxury brands need to step up their mobile marketing strategies to get the most out of the inevitable power this platform will have in 2011, according to industry experts.

Mobile platforms have skyrocketed in the past year and will continue to do so, but most luxury brands are not taking full advantage of the opportunity. Because affluent consumers are typically the demographic that have smartphones, luxury brands should think about catering mobile strategies to fit them.

“It’s not enough to just have mobile strategy,” said Mark Beccue, Tampa, FL-based senior analyst of consumer mobility for ABI Research. “Listening to consumers is what is going to make luxury brands have a greater impact via mobile.”

“A lot of brands have had their consumers call them, or email them and tell them what they want,” he said.

“When luxury brands have trusted their consumers and done what they have asked, the results have been significant.”

Enhanced mobile strategy
Only having a mobile application is not enough for brands to raise awareness – or sales – now that virtually every luxury brand has an application.

“Too many luxury brands are relying only on a smartphone application for their mobile marketing strategy,” said Lindsay Woodworth, director of marketing at 2ergo. “Too few luxury brands and retailers are selling via the mobile Web.

“The fact is, the sooner the brand marketers embrace mobile commerce like they did ecommerce, the better,” she said.

“Robust marketing strategies focus on building mobile assets, such as mobile Web sites with commerce solutions, and then using messaging to drive traffic to this asset or directly into the physical store.”

Additionally, ABI’s Mr. Beccue said that a brand deciphers the target audience and figures out how they use mobile and how to reach them.

For instance, if a brand finds that its target demographic consists more of BlackBerry than iPhone users, it wouldn’t be wise to create an iPhone application.

Most importantly, mcommerce is easy to navigate and convenient for consumers, more notably affluent ones who may not have a lot of time to shop and find it simple to do so from their mobile devices.

“The thing is, this only works if the sites are simple,” Mr. Beccue said. “Mobile Web sites should be easy and should take as less click-throughs as possible to get to the sale.”

Why it’s important
A study by ABI said that the amount spent on mcommerce 2009 was $1.4 billion in 2009.

By the end of 2010, that number will more than double to $3.4 billion. Travel-related purchases (airline tickets, hotels, etc.) will add another $1.5 billion (see story).

While luxury brands are only slightly behind in the mobile game, the fact remains that some of their competitors are not.

Luxury retail sites like Gilt Groupe and Rue La La have applications and commerce-enabled mobile sites that offer designer products at discounted prices.

Consumers are more likely to go to a site that offers discounted deals, as well as an application or mcommerce site that is easy to navigate and fast.

“Luxury brands also need to grasp the thorny issue of discounting,” Ms. Woodworth said.

“Customers are using the mobile Web for coupons and to compare prices, so luxury brands need to decide how they are going to compete in this area,” she said. “Luxury retailers can use the mobile channel to offer access to product reviews, exclusive content, personalized recommendations, and other services beyond coupons.”

In addition, Mr. Beccue noted that new technologies are already in development to create different options for mcommerce.

“Mobile Web sites, smartphone applications, and text messaging campaigns such as SMS and couponing are what everybody recognizes as mobile marketing,” 2ergo’s Ms. Woodworth said. “But these are just tactics that should be part of a wider strategy to attract and engage mobile shoppers.

“2011 will be the year that the majority of brands understand this concept,” she said.

Final take
2ergo gives suggestions for how brands can step up their mobile strategy

Rachel Lamb is an associate reporter on Luxury Daily. Her beats are apparel and accessories, arts and entertainment, education, food and beverage, fragrance and personal care, government, healthcare, home furnishings, jewelry, legal/privacy and nonprofits. Reach her at rachel@napean.com.