This week AOL (s aol) and American Express (s axp) jumped aboard the crowded daily deal bandwagon, joining Groupon and LivingSocial as well as Facebook, Google (s goog) and an ever-expanding field of startups. And while the market for email coupons may already be saturated, our appetite for mobile data continues to grow, which means there’s new ground for distributors of discount offers.
But mobile is a very different game than email discounts: Our phones are always with us, so they’re much more personal than computers, and they provide marketers with tools like location data and downloadable apps. So coupon distributors will need to be mindful of four important areas as they expand beyond computer-centric businesses into the more complex world of smartphones.
1. Unwanted ads. Groupon has demonstrated that consumers are happy to receive a deal a day via email on their computers, then occasionally buy it to use weeks, or even months, later. But because phones are more personal devices, our tolerance for daily come-ons is much smaller, as this recent study from Ipsos Observer illustrates. Instead of pushing one or two ads a day at scheduled intervals, mobile deals should be delivered to consumers when they’re specifically looking for something or when they voluntarily disclose their location to see what’s nearby.
2. Location and search. GPS and geofencing are valuable tools, but sending an automated offer based solely on location isn’t enough. That’s why the tired “Starbucks scenario” of offering discounts to anyone who passes in front of a store has never taken off, and why proximity marketing via Bluetooth has foundered. Location-based offers should be sent when users check in at a specific venue or when they use their phones to search for something, and those offers should take into account the context of those activities.
3. App functionality. Groupon has the right idea here with Groupon Now, which launched last month in Chicago and features just two buttons: “I’m hungry” and “I’m bored.” But that functionality is a fraction of what we could see in the next few years. Search topics could be far more specific, and apps could perform searches based on barcode information or even an uploaded image.
The market for mobile discounts is still almost entirely untapped, giving smaller players and newcomers an opportunity to compete with the big boys as the space gets legs. Those who best understand how to bring real value to users on their phones by presenting highly targeted offers could alter the landscape of digital deals dramatically. For more thoughts on how the daily deal players should leverage mobile, please see my weekly column at GigaOM Pro (subscription required).
Image courtesy of Groupon