Mobile marketing: Are you doing it wrong?

Mobility represents an increasingly important marketing opportunity for the aftermarket and dealership service departments, but few companies have been able to take full advantage of the potential that the explosion of smartphones represents.

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The pool of mobile device users continues to swell. Current smartphone penetration is around 55 percent, and according to figures that Greg Sterling, principal at Sterling Market Intelligence, presented at AAPEX, that number will reach 62 percent in early 2013. A Nielsen survey found that two out of three U.S. phone buyers are purchasing smartphones. Roughly 22 million subscribers prefer smartphones and tablets to PCs for Internet access, according to the Pew American Life & Internet Project.

"This device proliferation has created a diversified market in terms of where people are getting their information," Sterling says. "They are living in a multi-screen environment, and that creates complexity as well as opportunities for smart marketers."

According to DME, auto customers are much more likely to use mobile apps (44 percent) than QR codes (18 percent). In the 18-34 year old demographic among plugged-in customers, mobile apps have a 74 percent utilization rate. However, while two in three customers that use mobile apps use them at least daily, only 10 percent of auto service customers overall are using a mobile apps offered by dealers/service providers.

Customers want better mobile services

The problem appears to be a gap between the types of mobile apps and QR code applications offered by the industry and what vehicle owners are actually looking for. There could be a significant benefit for service providers that embrace mobile. Google claims that 16.8 percent of all mobile search queries are auto related. A Nielsen study found that 55 percent of automotive category smartphone users plan to buy products or services within a day. Half of mobile lookups lead to a purchase.

But screen proliferation has made it harder for marketers to address these new channels, as well as track leads. That's one of the reasons ad spend on mobile is paltry compared to the amount of time consumers actually spend exposed to mobile devices.

Most mobile users spend their time utilizing apps versus browsers. Nielsen found that apps account for 81 percent of users' time online, versus 19 percent for browsers. In automotive, however, users are only spending 7 percent of their time using apps, which reflects the lack of branded apps in the category.

On the business-to-consumer side, repair shops and parts retailers need to find ways to address urgent consumer needs (usually a car breakdown). Providing a direct connection from the consumer to the service provider could be a powerful marketing and sales tool. So far, the most successful mobile apps in the aftermarket have been on the business-to-business side, particularly mobile catalog applications like ShowMeTheParts, Bosch Part Finder and Gates' NaviGates.

"For OEMs or product retailers that are selling business-to-business, offering catalogs for tablet or smartphone users can be a successful approach," Sterling says. "That provides a way to provide greater efficiency in the supply chain, remove friction from transactions, but it depends on having good information available and having a good user experience."

Mobile marketing effectiveness has been difficult to track, since most aftermarket purchases are made offline, even when customers perform online parts lookups or searches. That's why using mobile apps provides a more effective way to both engage and track customer interactions. According to Sterling, some of the most effective business-to-consumer mobile apps have been those that dealerships offer for service updates.

"Many dealers have used e-mail to connect with consumers, but mobile is going to be more effective, because consumers are more attendant to their mobile devices, and they opt in to use those apps," Sterling says.

“Wave one with any new technology is adoption, and wave two is where businesses get it right, aligning their offerings with what consumers actually demand,” says Doug Van Sach, vice president of strategy and analytics at DMEautomotive. “While far more service businesses have jumped into QR codes than mobile apps, the former is essentially just a ‘door’ sending people to short-lived, and hopefully engaging, information. But mobile apps, which are always in that customer’s pocket or purse, uniquely forge long-term, hyper-close customer connections. They’re the ‘big house’ a business can build their service relationships on, but only if they build that house right.”

Another obstacle many companies face is that they have not optimized their websites for presentation on mobile devices. An estimated 80 to 90 percent of Fortune 500 companies don't have mobile-optimized sites; the same is true for some 79 percent of large, online retailers.

"There's a lot of debate among marketers whether you should create a dedicated mobile website, or a so-called responsive site that provides you with one site that works well across platforms," Sterling says. "There are multiple handset types, operating systems, and all these secondary factors that affect how your message looks to different users. That seems to have stymied folks that have difficulty making these decisions."

It's also important to remember what customers are actually looking for. According to DME's survey, that would be coupons and the ability to schedule online appointments, as well as accessing service reminders and maintenance schedules. But many QR codes are still sending customers to product information or static website links.

“Given the massive adoption of smartphones, it’s no wonder that mobile apps and QR codes are very hot topics in automotive marketing,” Van Sach says. “But our survey reveals that businesses that adopt cutting-edge technologies and then feed people irrelevant sales messages or generic product/business info are wasting the customer’s time and money. People demand real, tangible value, like coupons and discounts, and functionality that will make their lives easier, like instant online appointment scheduling and timely service reminders.”

A well-designed mobile app can help enable making those offers to customers, and generating repeat business. "Once you have an app on the person's device, if you are an auto parts store or a repair center, you have a relationship that can be the basis of trying to stimulate subsequent purchases through scheduled maintenance and other interactions," Sterling says.

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