I’ve written before about how CPG manufacturers and retailers need to redesign their approach to in-store marketing because they’re wasting millions of dollars. But many of them just don’t get it. And I understand. People running large corporations often hesitate to embrace innovation for a variety of both personal and business reasons even when CEO’s are looking for innovative leaders now more than ever before and nearly 75% say their marketing leaders lack business credibility. But consumers are changing their shopping habits at the speed of… well, Moore’s Law. Thus, it’s easy to conclude the innovators that are going to change the way companies market to shoppers will likely come from outside the industry.
So I guess it wasn’t surprising that I stumbled upon a cool new mobile technology in a small local coffee shop. Yola’s Café had partnered with tech upstart SnowShoe to offer a paperless loyalty program. Smartphone customers simply download the Yola’s Café app instead of using a punch card. Then each time they buy a cup of coffee (or other loyalty promotional item… try their Belgian waffles!), they place their smartphone on the SnowShoeStamp next to the register. The stamp authenticates the customer’s purchase and manages everything in a paperless digital environment.
“Well, that’s interesting”, you might say, “Nice, mobile loyalty program.” But I started wondering about applications beyond that so I chased down Claus Moberg, CEO of SnowShoe to hear more about what he was up to. The key innovation the SnowShoeStamp provides is a purchase authentication platform outside of the store P.O.S. system. This is potentially huge. Not only can it provide a real-time, digital authentication program for retailers like Yola’s Café and companies like Groupon and Living Social (currently when you use your Groupon, the store has to cross out your code in a binder supplied by Groupon) it also saves the expense of technology integration with wildly variable retail P.O.S. systems and enables smartphone apps for all kinds of consumer applications; applications like real time social media postings when consumers make purchases or earn rewards, incentives pushed to consumer smartphones to incent other purchases or to drive traffic to during slow times. I think SnowShoe is going to be big. And I think companies like Catalina Marketing or CPG manufacturers ought to be jumping on the bandwagon.
2011 ended with almost half of all U.S. mobile subscribers using a smartphone and the number is expected to easily surpass 100 million in 2012. Use of a smartphone for retail surged 87% last year and the trajectory is still headed steeply up. Consumers are using their smartphones in-store to take product pictures, text family and friends for advice, scan barcodes, find coupons, research product features and several other activities. Yet, many traditional CPGs and retailers see these behaviors as a threat instead of an opportunity.
Earlier this year I attended the Shopper Insights in Action conference sponsored by IIR USA. Many companies shared how they have been turning insights into action to drive better results. Well, here’s an insight: change is only going to accelerate. Some people are saying marketing is dead. And a lot of the really innovative shopper marketing stuff is coming from outside the industry. If CPGs and retailers aren’t going to step up and redesign their approach, someone else will. Likely, it’ll be the entrepreneurs and innovators of small business.