Consumer brands used to follow a handful of fairly simple strategies to connect with their customers. But today’s consumers are being increasingly bombarded by a dizzying amount of information on different screens vying for their attention. How can brands rise above the noise, especially in mobile? One way brands can try to engage with their customer is through branded apps. In 2014, mobile users spent 86% of their time on mobile in apps as opposed to on the mobile web. So it makes sense that brands should try to connect directly with customers with their own mobile app.
But what kind of apps? Interestingly, some of the world’s biggest brands have relied on old-fashioned marketing and promotion principles to innovate and develop the most successful app strategies in mobile.
Two great examples are Nike, using their Nike+ app and Starbucks with their mobile wallet payment system. In addition, there are new third-party apps such as Ibotta that leverage a similar combination of old-school promotion with new-school engagement to enable large offline brands to reach their customers in new ways on mobile.
Nike is one of the most valuable and recognizable consumer brands, with the “Swoosh” logo and the “Just do it” slogan known around the world. The Nike brand stands for one thing: inspiring people to lead athletic lives. But to Nike, their brand also stands for innovation. Nike proved this in 2006 when they first developed the Nike+ for iPod, a run tracker sensor and software that preceded the iPhone.
Since then, Nike has released the mobile apps Nike+ for running, NikeFuel, and Nike+ Training Club, with features that help athletes track their efforts, set goals, tailor their workouts, and share their performance with friends and peers.
None of these apps are about selling shoes, at least not directly. They are about inspiring people to do more as athletes and enhancing their workouts. This reinforces Nike’s brand as an organic part of their experience. Nike understands that brand-building in today’s age is no longer about sponsoring “hero” athletes like Michael Jordan and Tiger Woods, it is about connecting with the customers and enabling them to pursue their own goals and tell their own stories.
This is why Nike has emphasized social interaction and community building around the shared passion of athletics. When you set a great time on a challenging run, it’s very tempting to share the proof with your peers on Facebook and elsewhere.
The result is that the Nike+ user base has grown to over 28 million people. The benefit for Nike is not just that they have found a way to make their brand a leader in the new age of mobile, but also that they have achieved a greater degree of customer intimacy. With passionate athletes using the apps on a regular basis, Nike gains detailed, high frequency information about their customers. Nike can use this information to drive engagement, and ultimately, profit.
Validating this aspect of Nike’s app strategy, competitor Under Armour recently acquired fitness apps MyFitnessPal and Endomondo. While Under Armour is sure to benefit from the same user intimacy, by acquiring existing companies rather than innovating on their own branded app, they won’t likely achieve the brand value that Nike has built in mobile.
Starbucks -- Rewards + Convenience = The Killer Mobile Payment App
Another mobile app getting a lot of buzz these days is Apple’s mobile wallet, Apple Pay. The ability to pay for things instantly with your mobile phone without needing to swipe a card seems like the way of the future. Fitting that the world’s biggest, most imaginative tech company would be leading in this space. But are they? You might be surprised to know that the most successful mobile wallet app in the world is the one built by Starbucks!
Today, the luxury latte giant processes over 7 million mobile payments a week, more than 16% of its total sales volume. That’s pretty amazing. How did Starbucks achieve this? They’re not a technology company! Starbucks assembled a brilliant technology team who figured out how to make a simple 2D barcode on the phone that could be scanned by the existing POS system found at every Starbucks. Then, Starbucks combined the convenience of the mobile wallet with their existing, hugely popular loyalty program, My Starbucks Rewards. The result was that habitual users could do two things – pay and get rewards – instantly.
If Starbucks had tried to get their customers to use a mobile payment app on a stand-alone basis, it may not have been as successful. But Starbucks understood the value of its loyalty program, a classic old-fashioned promotion strategy. By using the mobile wallet to make rewards that much easier to get, they are driving customer engagement and loyalty to a greater degree than ever before. What’s next for Starbucks? Howard Schultz, the CEO, believes they could “white label” their mobile wallet technology to other major retailers, which might even give Apple a run for their money.
Ibotta – Brand Engagement in a Mobile Coupon App
Even when brands have a successful mobile app of their own, there are other third-party apps that can help them find new, powerful ways to connect with their customers on mobile. One such company is Ibotta, which combines the old-school promotion strategy of coupons with an inventive mobile platform. One feature that makes Ibotta easy to use is that you don’t even need to take your phone shopping. You can activate the coupons at your convenience, and then simply take a picture of your receipt to show that you bought the designated items. Ibotta then gives you a credit that can be converted to cash.
But an additional benefit to the brand is that Ibotta requires the customer to take some kind of action or engagement about the item – taking a poll or posting a social media like, for example – to activate the coupon. In this way, Ibotta drives the kind of discovery and engagement that can be very difficult for consumer packaged good brands to achieve in mobile.
The fast-evolving world of mobile can sometimes seem like a scary new universe with its own laws, and established brands may believe they have to re-think everything they know about how to get the most out of mobile’s capabilities. But brands can achieve spectacular success on mobile by asking the fundamental questions– who is my customer and what value does she get from my product— and find a way to use the power of apps to increase that value. As we have seen with Nike, Starbucks and Ibotta, traditional strategies like brand building, loyalty programs, and couponing can be deployed in innovative apps that can enable offline brands to not just keep up, but to thrive in the brave new world of mobile.
