Castro Valley, CA-based Pete’s Ace Hardware store increased its average customer cart size by 411% with a mobile coupon campaign it ran this summer, the retailer says.
49% of consumers sent the coupons redeemed them, and the campaign resulted in more than 190 new customers signing up for the retailer’s mobile coupon club, says Pete’s owner Linda Roark. “The way that the younger generations are finding out about where to shop and other information about products is through their mobile devices, their computers, their tablets,” Roark says. “Customers come into the store armed with more information than ever before, so mobile couponing is just a natural extension of them getting knowledge—they can now also get savings.”
The campaign was created by vendor FunMobility Inc., which says its mobile coupons automatically adjust to fit the size of the consumer’s screen. Retailers can send them as links in e-mails, text messages or through mobile apps or web sites. After a coupon appears, shoppers may swipe left or right to see other coupons or tap to redeem one by either saving it in a text message, e-mail or, for iPhone owners, to the Apple Passbook, Apple Inc.’s mobile wallet.
Pete’s Ace Hardware ran its campaign with four mobile coupons for the first two weeks of July. Customers who responded to text messages with the word “Petes” were then asked to opt in to the mobile coupon club, after which the retailer began texting them links to mobile coupons. Those who redeemed coupons bought on average $72 worth of merchandise.
The retailer is now enhancing its mobile coupon program, including by adding more in-store promotions and pushing large-ticket items in the offers, Roark says. “I can now update coupons to tie in with community events, holidays, or even an unexpected heat wave” by offering coupons for fans, she adds. She calls FunMobility to request such changes and says they respond with an updated coupon within several hours. The vendor says it also provides a portal for retailers that want to design and create their own coupons.
FunMobility also reports how many customers have opted in to campaigns, coupon clicks and other metrics; Roark says she can monitor the store-related metrics, such as redemptions and average order values, from her own point-of-sale system since each coupon has a unique code.
Since Pete’s Ace Hardware tested the FunMobility mobile coupons, Roark says she has helped set up similar pilot programs for 11 other Ace Hardware stores at the Ace corporate headquarters’ request. Those programs are running from now through December, she says. Another 20 stores have also signed up so far to start running mobile coupon campaigns in January.
FunMobility costs several hundred dollars per month per retail location, with discounts for large numbers of stores, according to vice president of business development Pat Murphy. The charges also depend on whether retailers want additional features, he says. For example, the vendor allows retailers to add click-to-call to their coupons or geotargeted notifications so that, if a customer has saved a coupon in her Passbook, she’ll receive a reminder to use it when she is within a certain radius of the store.
At Pete’s, Roark declines to say what the retailer spent on the FunMobility program, but notes that it generated revenue equal to 13 times the cost of the mobile coupon campaign.