Online sales grew by more than 30% in the fourth quarter, but store sales slid by 6.1% year over year.
That’s good news for pioneering retailers making SoLoMo offers.
Many consumers like their friends to know where they are and where they’ve been, downloading by the millions social/local/mobile apps such as Facebook Places, foursquare, shopkick and Wallit. In these apps, a consumer checks in at a location via the GPS technology in her smartphone.
18% of U.S. smartphone owners in February 2012 used a SoLoMo service to check in to certain locations or share their location with friends, according to a new study from the Pew Research Center Internet & American Life Project. That’s up from 12% in May 2011.
Over the past year, smartphone ownership has risen from 35% in 2011 to 46% in 2012, says the Pew study of 2,253 U.S. adults. This means that the overall proportion of U.S. adults, not just smartphone owners, who have used SoLoMo services has risen from 4% in 2011 to about 10% in 2012. The discrepancy in the overall adult percentages is due to rounding of all percentages.
Some merchants in mobile commerce have begun communicating with these millions of consumers who like to check in and let friends know where they are. Cinnabon, for example, is using its venue pages on foursquare and Facebook Places to reward SoLoMo customers. A venue is a page that contains a location’s GPS geocode and displays information on the location as well as special offers or coupons if available.
Last year Cinnabon began a SoLoMo marketing program. It let franchise owners place coupons on their store pages for free rolls, 15% off a purchase and other special offers. When a foursquare or Facebook Places user opens one of the apps and the app pinpoints his location using his smartphone’s GPS technology, the app presents a list of nearby stores, restaurants and other locations. When the user sees a Cinnabon bakery, he can tap it and then see a store’s page with the special offer.
Consumers responded big time. After Cinnabon began making special offers, foursquare check-ins increased 43% and Facebook Places check-ins and Facebook mobile Likes increased 86%, Cinnabon reports. The payoff has been increased customer engagement, a big boost in word of mouth and additional sales, Cinnabon says.
“Bakeries want to encourage people to tell their friends to come, and that plants the seed for others. They see check-ins as digital word of mouth,” says Rachel Hadley, corporate communications manager at Cinnabon who heads the chain’s social media program. “Now we’re definitely considering location-based services opportunities with every marketing campaign we conduct. Location-based services have become second nature.”
The Pew study also found that 74% of smartphone owners in February 2012 used their phones to get location-based information such as directions, up from 55% in May 2011.