Can Micromarketing Help Your Business?


We live in a world where everything needs to be personalized and delivered when we want it the most. A marketing campaign, even if well executed, has a limitation in that your potential  customers may forget about your business because they were near some other shop when they wanted to purchase something. (or saw a different ad on the internet). You realize that some of your marketing efforts are working, but which ones? You are not sure of that. But you already have a lot of information on your customers, and if that can be leveraged, you will be able to draw customers at a better rate, at similar costs!

Micromarketing addresses this problem. It is a “marketing strategy in which advertising efforts are focused on a small group of highly-targeted consumers. Micromarketing requires a company to narrowly define a particular audience by a particular characteristic, and tailor campaigns for that particular segment – Wiki”.

It is normally used by political parties to identify and convey critical messages to people individually. Voters’ characteristics enabled the campaign managers in the 2012 US Presidential elections to identify specific topics that people were bothered about, and issues relevant to them were raised to catch their attention.

Micromarketing in Practice

In the UK, Weve is probably the best known company that provides micromarketing services to its clients. Weve was jointly set up by Vodafone, EE and O2, and has seen client spending on mobile micromarketing quadruple from the first quarter of 2013 to the last quarter. Clients started by just testing waters and when they tasted success, they were willing to spend more on this concept.

So how does mobile based micromarketing work? Let us take the example of Weve again. It has a customer base of over 20 million customers who have opted-in to receive notifications about things they are interested in, on their mobile devices. These notifications are mostly delivered on a location awareness basis. This means that messages will be sent to customers who are around a shop that sells products to their liking.

The information in the company’s database is then mapped with users’ choice, their internet history, their shopping preferences, etc. Users’ mobile phones are then tracked and relevant offers pushed to their devices. As customers use their mobile phones and relevant apps, insights on them get added up and that leads to even better targeted marketing (micromarketing).

Micromarketing Case Studies

In the case of Tesco, the retailer ran an advertising campaign on mobile devices that advised customers to order turkey for Christmas well in advance. That would assure them of good quality, rates and delivery. The messages were sent to people who were near its stores. The initiative was huge success. In another example, £5 discount offer was provided to certain women in a Tesco defined area. Over 40,000 redeemed that coupon in one day – that means a sale of £200,000!

In a similar case, Decca sent tailored messages to people who were attending the Proms. Initially 200 messages were sent to people who were present in a defined area around the music show. Each of the messages contained link to a download page that would take the customer to a track from an artist performing on the show. At the beginning, only 2 people clicked: only 1%. But when the coverage was expanded to include people around bus stands, tube stations and shops to include people who would be there around the time of the concert, a success rate of 2.5% was achieved.

Similarly, PayPal used the technology to inform customers about shops that accepted PayPal payments in their vicinity. It was trialed in London at a few retailers, and has been rolled out to over a thousand merchants across the country, including Prezzo & Gourmet Burger Kitchen. More locations will be added in the year 2014. But the adoption in this case will be slower than in other cases, because transfer of financial and sensitive data is involved.

The most important advantage of this technique that development of lead takes very little time. Since the customer is in the vicinity of the store and has also potentially received a discount offer, he is more likely to engage in a transaction and develop sales for you. Moreover, the customer has opted in to receive the offer, which increases the chance of his buying from you substantially.

Micromarketing Challenges and Caution

However, it is not that this new and exciting technology is without its challenge. Customers may not want to be bombarded with several messages in a short span of time. Besides, they may be wary of a shopkeeper addressing them by their names, when the two have not even met earlier. Therefore, it becomes important to tread a careful path and provide them with just about enough information to bring them to you. People have opted into receive such messages because they expect to see value. Decca’s case above is an example where you need to clearly and carefully define the set of people who will like to receive and respond to your message. Can your small business use micro targeting to your advantage? Absolutely yes, by carefully designing a strategy that works to bring people to your doorstep!

Is micromarketing an option for your business?

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