March 12, 2014, 9:07 PM

A regional chain devotes one-third of its e-commerce budget to mobile

The Midwestern h.h. gregg Appliances’ freshman e-commerce chief is in the midst of a mobile offensive: m-commerce site, mobile e-mail, Endless Blitz game app, geo-targeting, push notifications and text messages, and, coming soon, iPhone and Android shopping apps. 75% of in-store shoppers have mobile devices, making mobile an absolute priority, h.h. gregg’s Kevin Lyons says.

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The regional chain retailer launched a mobile app game called Endless Blitz that increased time spent with the brand and boosted sales. The game was played nearly 4.5 million times during the 2013-14 football season.

There was a time not too many years ago when experimental e-commerce chiefs at retail organizations had to go hat in hand to the C-suite and hope for some table scraps to create a mobile commerce web site. Today, the majority of time spent with online retail occurs on a mobile device, according to web measurement firm comScore Inc., and a shopper in a store without a mobile device is the exception, not the rule, merchants say.

“More than three-fourths of shoppers walking into our stores with smart devices means we have to be prepared and serve up content that keeps those shoppers inside our brand,” says Kevin Lyons, who regional chain retailer h.h. gregg brought onboard in May 2013 as senior vice president of e-commerce. Geo-targeted marketing, push notifications, text messages, mobile-optimized e-mail and mobile gamification are ways h.h. gregg is using the mobile medium to serve today’s shoppers where, when and how they want to be served, Lyons says.

Today, 30% of the Indianapolis-based chain’s web traffic is mobile; it predicts mobile traffic will eclipse desktop traffic next year. 15% of web sales occur on a tablet while 8% stem from smartphones, Lyons says. The retailer offers an m-commerce site for smartphones; the mobile technology firm PointSource assisted with the build. The merchant will debut mobile shopping apps for iPhones and Android phones this summer, again with the help of PointSource.

The merchant already has seen significant success in the app realm with a football-themed mobile game app called Endless Blitz, a type of game known as “endless runner,” where a character must constantly be moving forward, avoiding obstacles, gathering tokens, in a progressively more difficult setting. Lyons says of h.h. gregg Appliances, “We sell big well,” meaning the company knows well how to sell big things, such as HDTVs and refrigerators. The merchant partnered with various electronics and appliance manufacturers throughout the 2013-14 football season to offer special prizes—big ones—that game players with top scores could win. It promoted the game on its e-commerce and m-commerce web sites, through e-mail marketing, through its social media pages, and even on the Jumbotron at Lucas Oil Stadium during Indianapolis Colts home games.

The retailer built the app with app developer Plow Digital. The game app, which cost $100,000 to build and market, registered 88,000 downloads in Google Play’s Android app store, 63,000 downloads in Apple Inc.’s App Store, and 21,000 downloads in Amazon.com Inc.’s Appstore, between August 2013 and February 2014 (encompassing the most recent pro football season), Lyons reports. In that time period, app users played 4.5 million games, about 28,000 a day, Lyons says. He adds the retailer updated the game app 14 times in six months, adding new characters, new power-ups (special powers characters can use to make greater progress), and other new functions. The retailer will resurrect the game during the next football season.

The app was worth every penny, Lyons says. One metric he uses to gauge return on investment is time spent with the brand. During the last football season, consumers played the game 4,474,608 times; that's 28,320 plays a day, Lyons says. The average player played the game, which takes a minute to play, 26 times, so that's 26 more minutes spent with the brand. The total time spent by all players combined equals more than eight years, Lyons says.

Significant increases in Facebook Likes and new e-mail subscribers stemming from the app, combined with the increase in time spent with the brand, have generated sales that more than paid for the app, Lyons says.

"We are still tabulating the data, but so far, we see a lot more margin dollars out of those sales than what we paid for the marketing and development of the game," Lyons says. "For example, for our Black Friday On Us promotion, we saw a $250 increase in average order value for customers who engaged with us via that game promotion over customers who did not engage with the app promotion."

Black Friday On Us rewarded top players by paying for everything they bought at h.h. gregg on the day after Thanksgiving 2013. Promotions are featured in the app on ad banners that link to the m-commerce site as well as special contest landing pages that enabled purchases. They also are featured on scoreboards, billboards and blimps in the football-themed game. Samsung and Sharp sponsored some of the promotions, providing the prizes and offsetting some promotional costs, Lyons says. He declined to disclose specific figures regarding sponsors.

"The most surprising thing was how well received the game was in the game and app community" Lyons says. "We are still No. 17 in the Apple App Store's Sports Games category. And we've had more than 4,000 downloads after the football season ended, after we stopped promoting the game."

On another mobile front, h.h. gregg used responsive design techniques to optimize its marketing e-mails for consumers reading e-mails on mobile devices. 72% of h.h. gregg's e-mails are opened on mobile devices. Using responsive design adapts e-mail messages to the size of the viewer’s screen. The open rates for mobile-optimized e-mails are 50% higher than the previous non-mobile e-mails, Lyons says.

The merchant also used another form of mobile messaging, app-generated push notifications. It even combined push with geo-targeting. Whether open or closed, the app would use the GPS technology on the phone to detect when a consumer was in or near an h.h. gregg store. When a consumer with the app on her phone entered a geofenced zone—an area a retailer marks off with GPS location data—the app sent a push notification urging her to play the game to win special prizes or inform her of the current big promotion.

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