Harvester Restaurants’ couponing success

I missed this case study first time around, but since I seem to be thinking a lot about mobile and retail at the moment, I thought it worth sharing.

Harvester is a chain of family-friendly restaurants with 200 outlets across the UK. They’re open seven days a week and offer grills, sauces and sides, as well as a brunch menu and vegetarian options at very competitive prices. I haven’t been to Harvester restaurant in almost 30 years, so I can’t comment on the quality of the food but I have friends who enjoy it.

To attract new customers and to build repeat business, they rely on regular offers and you’ll see their website shows the latest offers and the latest menus. When the Apple Passbook arrived on the scene, mobile advertising firm, Millennial Media, teamed up with mobile couponing firm, Eagle Eye, to create a campaign to drive customers to store.

According to Gavin Stirrat, MD EMEA for Millennial Media, they served display adverts to iPhone 5 users and those who had upgraded to iOS 6, with a skew towards families. When you clicked the banner, you reached a landing page communicating the offer - £5 off when you spend £30 or more -  and the call-to-action to add this to your Passbook. Eagle Eye then pushed the individually coded coupon to their smartphone. No additional customer details were required making the process as seamless as possible.

Once the voucher was loaded into Passbook, you could redeem the voucher in the restaurant via the restaurant’s existing Chip & Pin terminal. In this way, it was possible to measure redemption rates and ROI. The campaign ran for two weeks and in that time, 16,000 vouchers were issued and around 700 were redeemed offering a 4.4% redemption rate. As the offer was for a minimum spend of £30, it drove at least £21,000 in revenue. And remember, this was just marketed to a subset of iOS customers who had iPhone 5 or iOS 6 so they had the improved Passbook functionality.

It seems that even iPhone 5 customers like a bargain…

More on Millennial Media’s site here and here. Press release on Eagle Eye’s site here.

Further reading on how digital can drive customer engagement, footfall and loyalty in the High Street from Eagle Eye’s Andy Smith in British Retail Consortium’s Winter 2012 publication. (It’s one of those magazine reader thingies so it won’t work on a tiny mobile screen).

Mobile coupons: People are the weakest link

I’ve just been reading an article over on Monty Munford’s blog by Rob Thurner about the ‘three things that need to happen before mobile couponing kicks off’. They’re both friends of mine but as a veteran of the mobile couponing business, I feel I should add a comment.

Some of you already know that I have many years experience at the coal face of retail. For those of you who don’t know, I spent the best part of 10 years working in fashion retail and working my way up from sales assistant to store manager in the early years of my working life. I’ve worked my way from the wilds of Worcester High Street to the bling of the West End and Knightsbridge. There’s not much I haven’t seen from store openings to store closings to being held at knifepoint for refusing someone a refund on something they’d clearly stolen. Yes, really. I was also lucky enough to work at the world’s first mobile couponing start-up, ZagMe, where we sent text messages to shoppers at Lakeside and Bluewater shopping malls. I think I know a bit about how this couponing and retail thing works.

Couponing in the UK is nothing like at the obsession levels that you’ll see in the US. They have shows over there about ‘Extreme Couponing’. I kid you not. We still like a bargain here, but we’re not quite as bothered about it. But it’s still big business and seems to be made for mobile. Well you’d think…

Like many things, usability isn’t quite there yet. But there are workarounds. Back in ZagMe days, we sent coupons via text message. We couldn’t event concatenate the message (that means combine two messages as one). Some phones could only store 10 text messages at the time. Can you believe it?! We’re talking 2000 and 2001. Yes, that long ago. Mobile couponing is not new. The ZagMe texts we sent had a code in them which was generated based on your age, gender, retailer and time of sending. That meant you might see a different code to your friend who received the same message so it looked like they were uniquely generated codes. Now of course, it is entirely possible to put a unique code into a SMS. If you want to. But it really depends on why you’re sending the coupon in the first place and how it’s financed. Since most coupons and discounts are funded out of margin, it doesn’t usually matter whether or not the coupon is shared or replicated. Indeed, that can just reduce the costs for the retailer that they’re getting free distribution. So chances are, you don’t need a unique code necessarily, you just need a way to manage the coupon or discount.

The way to do that is to set up a discount barcode for the specific promotion and have it reside by the side of all of your tills. You’ll need to train your staff properly so they know what to scan and when. And in the text message, email or whatever other coupon format you want to use, you make sure you put in any limitations on the offer – this usually means the date. Don’t have an open-ended offer. And if there are terms and conditions, make sure those are available for both the customer (perhaps via a link to click in the message) and the store staff (at POS and included in the training for example), so there’s no question about when the offer runs out. As it happens, I still have an Ann Summers coupon lurking on my hard drive offering me £5 off any purchase. There is no expiry date. It’s just a gif file. Maybe I should try redeeming it….

In his article, Rob goes on to explain about keyed entry, scanning and NFC as redemption methods. These are all coming. Some retailers who are further ahead have already embraced them. And as each retailer reviews their EPOS systems, they’re going to be thinking about mobile, tablets and offer redemption as part of the new system so we’ll see more. But these systems don’t get replaced every year like mobile phones or school shoes. They’re in place for many years and replacing them isn’t easy and it’s expensive as they impact on the whole supply chain.

But there’s no need to miss out on mobile commerce via couponing for non-food retailers*. You don’t have to wait until you implement your fancy new EPOS systems. Think about workarounds. Think about how secure your couponing needs to be (in which case, you can turn to Eagle Eye for a solution). SMS can still work here and it doesn’t have to be complicated. Or particularly techie for that matter. You just need to think about the customer experience and how you’d like that to be and then work out how to achieve it. And I suspect that eight, if not nine, times out of ten, you won’t need to have something particularly complex.

However, you choose to implement your discount offer – be that on mobile, email or pigeon post – please remember to communicate to your staff. It is no good having the fanciest mobile couponing system in place if your staff have no clue what to do when a customer turns up wanting their £5 off. Your people will be the weakest link if they haven’t been brought up to speed.

*caveat – grocery retail is a lot more complicated than other sectors of retail and the couponing rules are different.

Is mobile couponing finally hitting the mainstream?

It seems like a lifetime ago since I had my first exposure to mobile couponing back in 2000 at ZagMe. Yes, it’s some twelve years ago since I helped invent location based sms couponing with fellow mobilist, Russell Buckley. I’ve seen many coupon projects come and go and I’ve seen many location based services come and go, but finally, we appear to be at the point where this thing is hitting the mainstream. And yet again, we have Apple to thank for it.

May of you will know that I do not worship at the altar of Apple but there’s no denying that they have changed our mobile world forever. And may well be changing the world of mobile couponing forever too with the introduction of Passbook. This is an app that helps you keep track of your mobile coupons, tickets and gift cards. With the added bonus of being location-aware (optional), it can nudge you when you’re near an outlet where you can use said coupons if that company’s app has that feature included. I don’t have a working iPhone so I haven’t tested this myself, but from the description here, it still sounds a bit clunky. But I have no doubt that the clunks will be evened out pretty quickly as there’s more take-up and developers work out how to get the best from the service.

This is first to market in the US, but the UK is catching up. We’re not as coupon obsessed in the UK as the US (where they have a TV show dedicated to the topic), but we do still like a bargain – Groupon and its ilk have been a success here and SalesGossip is also gaining traction. Meanwhile, Harvester has teamed up with Eagle Eye and Millennial Media to be the first UK company to use Passbook for their couponing.

Helen Worrall, Marketing Manager, Harvester said: “We are excited to be amongst the first in line to use this new way to distribute mobile vouchers to Apple Passbook users, offering our customers a better and more convenient experience. Not only does it provide us with a new way of engaging the iOS 6 iPhone users, but the benefit having one central point to digitally distribute and redeem vouchers in real-time means we have more control and visibility over our marketing campaign performance.”

I’m interested to see how this one plays out (you can try out the campaign for yourself if you go to http://tinyurl.com/harvesterPB from your iPhone) and I will be watching to see how the campaign fares as well as keeping an eye out as to how other retailers take on the challenge of digital couponing beyond the iPhone.

Dare I say it? Is this the year of mobile couponing?

Give me just a little more time

And my love will surely grow.. Yes, that’s the lyric to a song from the 70s by The Chairmen of the Board. But it’s how I feel about so many location-based, time-based, relevant-for-me advertising.

Like a lot of people, I’ve signed up to my localised Groupon, Living Social and other services and it feels like I’m being bombarded by time-based deals. I’ve also recently signed up to Moshogo, which tells me about events going on my local area. A useful service in theory. But they’re all making the same fundamental mistake. They’re not giving me enough time.

With Moshogo, I receive a daily mobile-optimised email of what’s on today in my local area. And it’s really comprehensive and well put together. But by the time I read the email – even if it’s first thing in the morning, it’s simply too late. I don’t have time to get myself organised and friends organised to go and do something that starts in an hour’s time – no matter how amazing and how relevant it is for me. I probably need a selection of what’s on highlights twice a week and then I click through to the site for more. Or maybe I need to have the choice to hone the selection even further so it’s truly personalised.

Like a lot of folks, I do love a bargain. So in theory, Groupon style deals should work for me. But it doesn’t. With Groupon and its clones, it’s the same. I’m worn out with being shouted at as to what to buy right now. I’m just not that impulsive when it comes to shopping and making decisions about what to buy and what not to buy. I don’t think I ever was. And I’m sure I’m not alone in this.

Back in the mists of mobile time at the start of the century, I worked at a start-up called ZagMe where we sent text message coupons to shoppers at Lakeside and Bluewater shopping malls (the two largest in Europe at the time). These text messages were offer-based and sent while shoppers were actually out shopping. (Yes, I know. We were at least 10 years ahead of our time. We learned that one the hard way). We experimented a lot with timing of offers. And we learned two key things.

Firstly, the offers we sent as people arrived at the shopping mall were the ones most likely to be redeemed.

Secondly, time-based offers had to give the shoppers enough time to redeem the coupon without them having to charge across the shopping centre to meet the deadline of the offer. So offers that were time-limited to an hour were a no-no, but offers that could be redeemed any time that day were more successful.

So Groupon, Living Social, and those of their ilk. Please, give me just a little more time.

How not to do mobile marketing... Subway style

A friend just alerted me to this review of Subway's latest mobile marketing effort in the US. It's a tale of how not to do mobile couponing essentially. I suggest you give it a good read, but the upshot is that the coupons are only available in a few locations, namely Buffalo, NY and Seattle, WA markets. I can understand starting with some kind of pilot scheme, it makes sense to iron out any issues with a smaller set of customers before going national.

Anyway, back to the campaign. It's supported by the My Subway Mobile website and with flyers in store locations (where the offer is valid). The author of the article, Jay Holcomb, tells us about his experience:

"... despite my sincerest efforts, I had a very difficult time at both Subway locations where I tried to redeem my code that allows for a free sub upon creating account. Each location had the campaign flyers at the cash register, but the problem was to be found in the employees themselves: they had no idea about the campaign! I pointed it out to a total of four employees in these two locations, and no one had ever heard of it before."

A campaign is only as good as it's weakest link and clearly, in Subway's case, the staff were the weakest link. Or was it that staff training was the weakest link. There's no point dumping a load of flyers on your shop counter with the latest offer if you don't brief your team properly. That's something we learned very quickly back in ZagMe days and we spent a lot of time working with store staff and their teams bringing them up to speed with the latest offers and how it all worked.

Mobile marketing isn't just about the technology. The technology is only a small part of it. Your people, your brand, your service all play a part in it too.

You have been warned... don't make the same mistake!