Lesson Materials

LESSON 5: Mobile Commerce, Social Commerce and Localization Technologies

Why This Lesson

New web applications, the availability of cheaper smartphones and the emergence of social networks have forever changed the way
businesses are performed. Mobile marketing is aimed often at local audiences and is the fastest growing form of online marketing,
followed closely by social marketing on social networks. Mobile local is in its infancy but it is also growing far faster than traditional
desktop marketing.

Social networks are spreading rapidly and many of them cater to a specific segment of the population. Young visitors today will grow
up and spend money and retailers stand to benefit from online communities in several important ways:

• Consumers can be a source of feedback on product design and features, marketing and advertising campaigns, etc.
• Word-of-mouth (i.e., viral marketing) is free advertising and increases the visibility of niche retailers and products.
• Increased Web site traffic, a common effect of viral marketing, inevitably brings with it more ad dollars.

These new marketing concepts are introducing more conversational marketing that encourages more engagement by allowing feedback
via blogs, wikis, online forums, chat rooms, and social networking sites. Companies are finding that these revolutionary outlets not only
generate faster and cheaper results than traditional focus groups but also foster closer relationships with customers.

TOPIC 1: The difference between traditional online marketing and the new social-mobile-local marketing platforms

The main difference between digital and traditional marketing is the medium through which an audience encounters a marketing
message. While traditional marketing uses traditional media like magazines and newspapers, digital marketing uses digital media, such
as social media or websites. Of course, traditional marketing doesn’t mean it’s old fashioned. Traditional marketing still plays an
important role in people’s lives with the ever growing need to step out of the digital world. The immersive experience of an impactful
TV commercial and the tactile nature of a print ad in a magazine are as important today as they were 20 years ago because of their
lasting effects on your memory. Subconsciously you attach yourself to their brand emotionally, meaning they will stay at the top of your
mind.

Advantages of traditional marketing include:

• Impactful and easy to understand - A visually bold billboard or a striking TV commercial is a normal part of most people’s day
to day lives. They’re easy to digest and often entertaining.
• Printed marketing materials are more permanent - If you have an advert in an issue of The New York Times it will be there
until the magazine is recycled. Which is great if the consumer is an avid collector.
• More memorable - Seeing something in real life rather than on your phone is more likely to be remembered. The anticipation
of the new Super-Bowl ads or a beautiful and impressive window display is more likely to stay in your mind than an instagram
ad you’ll probably scroll past in seconds.

The disadvantages of traditional marketing can be:

• More difficult to measure campaigns - There are ways to measure traditional marketing campaigns such as brand trackers but
they are nowhere near as in depth or intelligent as the tools available for digital marketing.
• Often expensive - If you’re a brand in its infancy chances are you don’t have the funds for a 4 page spread in Vogue. Many
forms of traditional marketing will set you back a considerable amount.
• No direct interaction with the consumer - Unlike social media marketing, you’re more or less in the dark about your audience’s
reaction to your marketing efforts.

In the same token, digital marketing is just as important as traditional if not even more so. Digital marketing uses every touch point of
your daily use of the internet to reach you. If you are google searching holiday ideas for your next weekend getaway, the chances are
that soon after you will see a tailored sponsored ad from Sky Scanner tempting you with the holiday package offer to your destination
of choice. Using the internet for several hours each day is a normal part of most people’s day to day life and digital marketing just uses
this to its advantage by cleverly weaving in marketing communications into every digital channel, be it via our smartphones, in our
wearable computers, our cars, even to the point of sending specific information based on our locations.

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Lesson Materials
LESSON 5: Mobile Commerce, Social Commerce and Localization Technologies

Figure 12: Online Marketing Platforms

The Internet users now make up 57% of the global population. On average, people spend 6 hours and 42 minutes online each day. By
2021, a projected 73% of all ecommerce sales will come from mobile. That’s a mind-bogglingly huge amount of time and opportunity
to do some clever digital marketing.

Digital marketing benefits include:

• More options for engagement - Through channels such as social media you can physically see what your audience think of
your brand and marketing efforts. If your marketing has been shared, liked and had plenty of positive comments, you know
you’re doing something right.
• Easy to measure your campaigns - On the flipside to traditional marketing, the specifics of digital marketing tracking is
exceptionally in depth. This makes your learnings extremely clear for your next round of marketing efforts.
• Makes clever targeting possible - If you have the tools to specifically target a 29 year old female writer who loves Lizzo and
drinking Guinness then surely you can also create perfectly tailored content?

While the shortcomings of digital marketing may consist of:

• Digital ads can be deemed as annoying - Think about the moment you’re scrolling through your Facebook homepage and all
you want to do is see what your old school friends are up to these days. Then you get the dreaded sponsored ad for something
related to an embarrassing ailment you googled the night before. It’s sure to make you actively dislike the very brand doing the
clever targeting.
• Less permanent - Digital marketing efforts like Google ads, banners, promo emails or social media ads can have a fleeting,
temporary character. They’re intangible and can easily be ignored. If your target audience keeps scrolling or clicks to the next
page your ad will be gone from their screen.
• Constantly evolves - To get the most out of your digital marketing efforts there is a lot to learn. Each channel usually requires
its own specialist, from search engine marketing to social media, each channel requires a pro to get the best bang for your buck.
However, a grass-roots social media marketing strategy is a great place to start. Have a look at our digital marketing
strategy guide for some inspiration.

TOPC 2: The social marketing process

Social media allow businesses to quickly and easily respond to customers' comments, questions and concerns and consumers to
instantaneously receive help. Moreover, by answering to consumers' needs in public, businesses can show the quality of their service
and a certain level of transparency. Social marketing goals:

• Encourage consumers to become fans and engage and enter conversations

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Lesson Materials
LESSON 5: Mobile Commerce, Social Commerce and Localization Technologies

Figure 13: Engagement at top social networks

TOPIC 3: The marketing capabilities of social marketing platforms

Any typical social media would appear to face loss of control over where ads appear in terms of other content. They also would not be
able to control what people say in their posts and comments, some of which may be inaccurate or embarrassing material. Nevertheless,
the social marketing process depends on these steps to successfully reach out to the market:

Figure 14: Social marketing process

The true strength of social media is influence. Social media offers an avenue for companies to not only engage with customers but also
influence them with the correct content which assists them with making a decision. The effect of social media does not stop online. It is
part of a much bigger scope and although social media may firstly create a certain buzz about a topic, overall, the power that it generates
will establish word-of-mouth advocacy. The truth is that social media — when utilized strategically over time — is the most powerful
form of digital marketing as well as market research that the world has ever seen. However, it’s not a magic bean that grows overnight
into organizational success. It’s a platform for actual work. The art of social media marketing is knowing the best places to put in that
work, so you are able to get results and not just a lot of annoying people who think they’re your friends.

TOPIC 4: Key elements of a mobile marketing campaign.

More than 262 million Americans use mobile phones, with majority of them being used multiple times per day. In 2020, m-commerce
will account for almost 50% of all retail and travel e-commerce. However, the challenges in mobile search include:

• Motivating consumers to click

On average, a user would spend 3 hours daily on mobile devices, namely on:

• 42% entertainment
• 16% social networks
• 70% occur in home

Activities are similar to desktop activities, hence the online retail industry is experiencing rapidly growing smartphone m-commerce
sales, although these mobile devices are currently used more for communicating and entertainment over shopping and buying:

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Lesson Materials
LESSON 5: Mobile Commerce, Social Commerce and Localization Technologies

Figure 15: How do people use their smartphones to shop

Mobile use concentrates on apps, which consume 60% of smartphone time. Almost 75% of app time spent on user’s top 3 apps and
users use about 27 apps/month. Hence, app marketing through in-app ads are the most effective. If businesses place ads in most popular
apps, which are targeted to immediate activities and interests of their customer profile, there is a high possibility that it would bring in
sales.

Mobile marketing composes 64% of all online marketing, with dominant players like Google and Facebook. Mobile marketing
formats include:

• Search ads
• Display ads
• Video
• Text/video messaging
• e-mail, classifieds, lead generation

TOPIC 5: The capabilities of location-based local marketing.

Location-based marketing targets messages to users based on location, therefore it has been popularly used for marketing of location-
based services like restaurants or hotels. These location-based services provide services to users based on location:

• Personal navigation
• Point-of-interest
• Reviews
• Friend-finders, family trackers

Consumers have high likelihood of responding to local ads, although prior to 2005, nearly all local advertising was non-digital. Once
Google Maps was established in 2005, it enabled targeting ads to users based on IP address and general geographic location. Next,
smartphones that carry Google’s mobile maps app reached the market in 2007 to enable targeting ads based on GPS. These were the
precursors to the present-day location-based mobile marketing that is expected to triple over the next five years.

Two types of location-based marketing techniques that are commonly applied:

• Geo-aware techniques - Identify location of user’s device and target ads, recommending actions within reach
• Proximity marketing - Identify a perimeter around a location and target ads and recommendations within that perimeter

Identifying locations can be done using:

• GPS signals
• Cell-tower locations
• Wi-Fi locations
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