Location-based mobile apps effective in driving luxury consumers in-store
August 17, 2011, taken from Luxury Daily, written by Kayla Hutzler
Location-based mobile applications allow luxury brands to highly target their global consumers and offer them real-time offers and information.
Luxury brands can use location-based apps to break down their global audiences, and deliver relevant product information in particular areas. These types of mobile apps are arguably the best way to drive mobile consumers in-store.
“A location-based feature is a prime, low-cost channel to enable engagement and conversion,” said Shanthala Balagopal, product marketing manager at Velti, San Fransisco.
“Providing consumers with real-time offers that can be redeemed [in-store] immediately helps drive sales and increase loyalty,” she said.
“By filling an unexpected need, it delights the customer and nudges faster conversion.”
Mobile apps offer brands a direct channel to loyal consumers once the branded app is downloaded.
Therefore, brands should use their apps to help drive sales both in-store and online.
By incorporating a location-based feature, brands can communicate even more effectively with luxury consumers by breaking them down from a global audience to multiple, regional groups.
A regional group allows the brands to offer more real-time information and relevant product pushes based on the local season and trends.
Luxury brands can also use location-based apps to offer real-time, in-store offers or rewards to drive consumers to their nearby stores instead of just to a mobile site.
In addition, 78 percent of retail consumers use location-based apps on their phone, and 29 percent use them multiple times a day, according to a recent survey by JiWire.
Also, location-based feature reports provide brands with valuable insights about their customers.
“With real-time performance reports, campaign optimizations becomes easier and turn-around time is reduced, thereby increasing revenues,” Ms. Balagopal said.
Don’t push it
However, there are a few obstacles that brands may encounter when creating location-based apps, according to Ms. Balagopal.
As with any app, a brand must first convince a consumer to download it and allow for push notifications.
To achieve this, brands should ensure that a user’s first experience with the app is enjoyable and as stress-free as possible.
After this, a brand should only send highly-targeted, relevant push notifications that will be useful to the consumres.
In addition, a brand cannot send too many push notifications or the user will disable notifications or disregard them as spam.
Also, some brands may find that their consumers are having problems connecting to the app when they are in the store. This can be a major problem for the location-based apps that offer a floor map for local stores.
To overcome this, brands should place WiFi in every store.
Some brands are already using location-based mobile apps to engage with affluent consumers.
For example, the Four Seasons has an app that curates experiences around the hotel for customers at its Beverly Wilshire location in Beverly Hills, CA.
In addition, German automaker BMW used a location-based ad campaign and mobile app that allowed users to search for a specific model and find the closest one to their homes.
“Location-based apps are an effective way to drive discovery and conversions in-store,” Ms. Balagopal said.
“However, delighting the customer upon activation will be critical for retaining and converting the customer,” she said.
Kayla Hutzler, editorial assistant on Luxury Daily, New York
Kayla Hutzler is an editorial assistant on Luxury Daily. Her beats are automotive, consumer electronics, consumer packaged goods, financial services, media/publishing, software and technology, telecommunications, travel and hospitality, real estate, retail and sports. Reach her at email@example.com.