Customer loyalty program has reached a new level. What 02 in the Uk have done is show the power of mobile over email - the way Groupon sends their offers. Offers coming by mobile are seeing a huge response rate. This is an enlightening interview and I can see it happening in Ireland very soon.
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Daily Deal Program Deepens Loyalty for UK Mobile Network
OCTOBER 7, 2011
Shaun Gregory
Managing Director
02 Media
Shaun Gregory handles the advertising business at UK-based Telefónica 02, a branch of broadband and telecommunications provider Telefónica Europe. He spoke with eMarketer’s Lauren McKay following 02’s announcement of a mobile daily deal program that is said to rival programs from Groupon and UK mobile operator Orange.
eMarketer: 02 Media recently launched Priority Moments, a daily deal program offered exclusively through mobile. How does this program compare to the Groupon model?
Shaun Gregory: Priority Moments is built on a 2008 customer loyalty program in the UK called 02 Priority. That loyalty program, which started out by offering discount tickets for concerts at The 02—previously called Millennium Dome—to our mobile and broadband customers, has become one of the best recognized and most successful loyalty programs in the UK. Since its inception, about 10 million of our 22 million UK customers have opted in. Players like Groupon don’t have that customer base.
“Because it’s based off an app that recognizes location, Priority Moments offers our customers unique experiences in their preferred location that can then be redeemed in-store with the mobile device.”
Whereas Groupon offers more bargain-type deals, Priority Moments focuses more on experiences, such as a VIP fashion event or a free restaurant course.
We give customers the opportunity to store offers and access them via mobile when they are ready to have that Priority Moment. They can also share the offers with friends. Because we have rich data about our customers, both through their mobile and broadband usage and their loyalty program activity, we can create highly personalized deals. We expect it to scale quickly.
eMarketer: How does Priority Moments boost loyalty?
Gregory: It boosts loyalty because it can save customers over £100 in times of austerity in the UK. That’s the main driver. It’s also giving customers the opportunity to pull offers, rather than receive push messages.
We focus on driving brand consideration among our customers who opt in to receive deals. There’s a big difference between customers who have made a purchase decision and those who are pondering or considering a purchase. With 02 More, our location-based targeting program, it’s all about driving consideration.
eMarketer: 02 has pioneered a number of location-based campaigns for UK brands. What has been successful and why?
Gregory: We started deploying location-based solutions nearly a year ago. Now more than half of our campaigns involve location elements because it delivers a great customer experience. We’ve worked with mobile marketing company Placecast to develop sophisticated geo-fencing technology.
Our first campaign was with Starbucks and we offered O2 customers 50% off discounts on the Starbucks VIA Ready Brew product. The offers were delivered by SMS messages to subscribers who had expressed an interest in food and beverage deals. After the offers were sent out, the redemption rate was 14% and then an additional 23% of customers said that they would redeem in the future. So, well over a third of our customers either redeemed or said they are going to redeem. The recall was 93%, which is an important metric.
Response rates are very good because you’re delivering on relevancy. We did a location-driven mobile coupon campaign for Fitness First, a chain of gyms in the UK. We pushed messages for free gym trials to the consumer’s nearest club. The campaign generated a response rate of 8.6%, which totaled close to 9,000 leads and ultimately led to 700 new members. If they really think it through, there are so many things marketers can do with location—it’s not only where the customer is but also the mood they are in.
“If they really think it through, there are so many things marketers can do with location—it’s not only where the customer is but also the mood they are in.”
And once a customer gives you permission, if you can deliver something relevant in the right environment at the time that they want it, that’s very unique. A good customer experience goes beyond just a good customer experience on the device. It’s making sure that the retailer and the point-of-sale staff are fully briefed, so they know about the campaign and can make sure it’s executed properly.
