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Extending and Enhancing Closed-Loop Marketing via the Mobile Channel

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Increasingly, organizations are using customer data and behavior to direct and refine marketing strategy and tactics, creating a closed-loop system between their marketing message and their customers that continuously evolves.

According to a recent report from Aberdeen, "The CMO Strategic Agenda: Automating Closed-Loop Marketing," 88 percent of best-in-class companies have adopted this full-circle or "closed-loop" marketing approach, and they have procured technology to help automate the process.

As these companies look for ways to expand their closed-loop automation efforts, the mobile channel—with increased adoption of technologies like SMS (short message service, or text) and MMS (multimedia messaging service)—stand out as a new frontier.

While mobile marketing can be invasive on its own, integration with the larger marketing campaign mix and proper tracking of customer response can ensure that customers are drawn in, rather than turned off, by mobile messages.

The mobile medium has achieved staying power as a gateway for marketers to reach customers in motion. For example, SMS can serve as the initial point of contact with customers, with the intention to drive the customer somewhere (to a store, kiosk, Web site, etc.).


Also, because the mobile medium is not as cluttered as others, such as email, its response rate has been higher. According to the Nielsen Company's March 2008 Mobile Advertising Report, half (51 percent) of all data users who recalled seeing mobile ads in a 30-day period responded in some way, and 26 percent responded by SMS message.

Neolane conducted a survey of North American direct marketers which found that four out of five marketers plan to incorporate at least one additional emerging marketing channel by the end of 2008—most likely SMS or MMS. However, fewer than half were confident that their current tools could effectively manage emerging marketing channels, or coordinate campaigns across emerging and traditional channels.

To truly execute on a closed-loop approach in which all customer responses can be incorporated into future marketing messaging, and to ensure that each message reaches prospects at the right time via the right channel, mobile marketing data must be incorporated into existing marketing and customer relationship management (CRM) tools.

Enterprise marketing management systems will play an important role in companies looking to effectively add mobile CRM to their arsenal. Marketers must have the technological infrastructure to automatically ensure they know enough about who they communicate with. Continuous monitoring and response mechanisms are necessary to best understand the implicit and explicit actions or behaviors of your customers across all channels, including mobile.

Ideally, such a system would provide data on a granular level: "How did each and every customer respond, and what does that mean for the way in which I will market to them next?" Sending a compelling text message or directing customers or prospects to a WAP (wireless application protocol) site won't get you very far unless you understand how they responded and you automatically know what to do for your next point of contact—whether an email, another text message, or, more traditionally, a direct mail piece.

European marketers, who have been evolving the mobile channel for years, have discovered that mobile communication has got to be either highly relevant or highly important to be effective. Accordingly, organizations need to funnel customer data derived from different databases, from numerous data capture systems, and from various channels, including mobile, into one central data mart in order to determine the preferences and interests of customers.

For example, to stay relevant and embrace the digital age, EMI Music had to figure out who, exactly, was downloading its artists' music, and how to maximize communications with those consumers on the right channel to strengthen relationships and drive more revenue. The company used an enterprise marketing management system to pull data from across multiple channels, including direct, email, and mobile, to determine the appropriate audience for sending SMS messages for alerts about upcoming events, new ringtones, and screensavers.

EMI Music also plans to leverage this comprehensive customer information when it rolls out MMS campaigns that offer access to artist photos, video clips, and music downloads on 3G wireless devices.

By engaging the customer across all channels, including mobile, EMI Music's digital revenues have soared and the company is on track to meet its goal of ensuring that 25 percent of overall revenue comes from music downloads by 2010.

Mobile marketing has the potential to expand the closed-loop marketing vision for many companies. It is a new channel that opens up dramatic new opportunities to engage customers 24x7. However, as noted, mobile marketing can't operate in a silo: Mobile efforts have to feed traditional marketing efforts.

To go beyond the hype and leverage the potential of mobile marketing, marketers need to have the infrastructure in place to bridge the gap between mobile channels and traditional channels and effectively interact with each customer at any point in time.


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Stephan Dietrich is president of Neolane Inc. (www.neolane.com). He is responsible for driving its corporate vision, worldwide marketing strategy, and international business development.

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