As virtual wallets near the tipping
point of widespread consumer acceptance, mobile loyalty is quickly
becoming a must-have app for mobile banking offerings. In a sign of
things to come, a flurry of new launches in the virtual wallet
market provide businesses with a new way to deliver incentives for
mobile customers, writes Charles Davis
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According to Chetan Sharma Consulting, it’s
predicted that, by next year, 70 percent of the world’s population
will own a mobile device. Mobile web penetration globally is also
already above 25 per cent and rising rapidly. Expected to climb
still higher, Gartner forecasts that US smartphone sales will jump
from 2010’s 67 million units to 95 million units by year’s end. By
contrast, mobile PC shipments are expected to rise, during the same
period, from 45.6 million units to 50.9 million units.
Devices that combine mobility and access, such
as smart phones, iPods and the Kindle book reader, create
opportunities and stimulate demand for mobile media. The
availability of GPS on mobile devices opens the door to countless
new location-specific applications allowing people to do things
that were the stuff of science fiction a few short years ago.
Mobile-based loyalty programmes may be the
first step toward the development of Near Field
Communication-powered mobile payments, getting cardholders signed
up for virtual wallets that can then be expanded into other
services.
One mobile wallet newcomer, Omnego, has
launched a mobile wallet application that allows consumers to take
their physical loyalty cards, coupons, reward certificates and
other merchant offers into digital formats usable on mobile devices
such as smart phones.
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By GlobalDataOnce the consumer downloads Omnego’s Walgo
app, they can create a mobile card from any loyalty or
frequent-user, coupon or membership card – the app creates an exact
physical representation of the card on the app.
“That mobile card gives the business a channel
for ongoing engagement using mobile ads, mobile coupons, or links
that can access the business’s mobile web content and
applications,” says David Thomas, CEO and founder of Omnego.
“The business can track usage, and alert them
if they aren’t using their cards with special offers. It’s a better
way to build customer loyalty while also giving the consumer a much
better experience.”
The Toronto-based mobile technology company’s
mobile loyalty and rewards programme can be used by any merchant or
business with loyalty schemes such as gift cards, membership cards
or coupons. Participating merchants must also have point-of-sale
scanners capable of reading digital bar codes.
To participate, merchants use a web-based platform to create
digital versions of their loyalty or rewards cards, which are exact
replicas of the physical cards. The platform also enables merchants
to manage programmes associated with the card, such as promotions
and deals.
“It’s an engagement point for business that is
always with the consumer and always on,” Thomas says.
“It allows the business to stay in contact
with their customer base on the channel they choose.”
Up in the clouds
Another mobile wallet product, by Cardmobili,
is building a mobile loyalty offering that uses cloud computing
technology. After successful launches in Europe and the US,
Cardmobili recently expanded to Canada, says Jeff Seabloom,
the company’s senior vice president of US operations.
Cardmobili is a free service that allows
consumers to consolidate all of their loyalty, membership, rewards
and association cards and any other valuable information directly
into their mobile phones.
Cardmobili is building a cloud with more than
1,500 programmes and memberships, but cardholders can also choose
to add their own custom card online. The service is adding more
cards every day based on direct feedback from consumers and social
networks.
Seabloom says that Cardmobili is attractive to
merchants because it provides standard interfaces to ensure
seamless integration with merchants’ CRM systems, thus enabling any
programme with mobile functionality for loyalty and marketing
programmes as well as promotions, brand awareness and direct
communication to consumer’s mobile devices without the need for
major investments in systems and infrastructure.
“This puts all the consumer’s cards in one
place, allows them to store them all, access them remotely and
organises them, but it’s at least as important to note that the
Cardmobili platform allows businesses with customers on the cloud
to receive offers on their phone,” Seabrook says.
“So the tie to programatic benefits, and
customer communication, loyalty, is huge, and we allow the card
side to present offers and communication to the consumers in the
cloud.”
Seabrook noted that mobile loyalty programmes
offer several advantages for card issuers: on-boarding fee
reduction by up to 88 percent, increased customer interaction,
including recognition and incentives for segments of customers.
They also offer the opportunity to drive retail traffic and brand
preference with targeted paper-free vouchers, promotions and
rewards.
Other competitors emerge seemingly daily in
the virtual wallet market. PlacePop, for example, allows any
company to create and maintain virtual loyalty cards online.
Consumers can “check-in” through the application, earn
points and earn free products or special privileges for being
a virtual card holder. The more points a user earns the higher
their level, starting at bronze, then on to silver, gold and
platinum. Businesses can customize their card and loyalty programme
on the app.
Major players like Foursquare, Tetherball,
Loopt, Shopkick and Gowalla are starting to add loyalty rewards to
their services as well, giving brands the means to offer specials
or promotions to those who check-in to a particular venue.
