If you have a system in place with trackable analytics, you can make money deploying a mobile marketing strategy with text messaging. I’m going to show you how to do this in your business, and let’s get some specific numbers on the board here so you can see what I’m talking about. Most retail business owners have a lot of customers. For the sake of simplicity, since I’m not great at math, and you probably have more customers than this, but let’s just use this number as a round number. Imagine you only have 1,000 customers in your text database. Through various incentives, through top of mind call to action and rewards frequency and inactive engagement and other things that I’m going to talk about, if we can get your customers to come back 4 more times in the course of an entire year …
Would you agree with me that you can incentivize a customer to come in 4 times over the course of an entire year?
I think 4 more visits, more than they would normally come in otherwise, is a reasonable call to action. If that person was to spend an average of $12.75, and that number is an average that people spend going out to eat, so maybe a little bit less for breakfast, a little bit more for dinner. The average person, if they’re going to go out and spend money on food, is going to spend $12.75 across the US. 1,000 people in your database, 4 additional visits over the course of an entire year at an average spend of $12.75 will add an extra $51,000 of revenue to your bottom line. I don’t know about you, but I could certainly use an extra $51,000.
I think you would agree with me that we went very conservative in terms of our call to action in terms of 4 visits or the number of people in your text database, or even the price at which the average spend is. Let’s just be ultra conservative for a moment. Let’s just take those figures, totally cut them in half. Totally cut the figure in half. That’s still added revenue of over $25,500 to your bottom line. Remember, at this point, we’re only tapping your existing customers, making them more loyal. We’ve not even touched on using your existing customers to bring in new customers and the new customers coming in through social media and that kind of thing.
This is 1,000 people in your loyalty system coming in 4 more times in the course of an entire year, that they wouldn’t have come in necessarily otherwise by using mobile marketing and text messaging strategies and adding money to your pocket.
Now, suppose your business isn’t in the food industry.
Maybe you’re a salon, where your average spend is $25$50 or more. Maybe you’re a spa, and you’re in the $50$100 range. Auto service, $20 for an oil change and more for other things, rotations, alignments, and other things that you’re going to do. Florists, novelty stores, boutiques, second-hand clothing stores, entertainment like golfs or arcade or things like that. Your average spend is $3, $40, $50, $100, $200? You can see how an added visit or 2 that the person wouldn’t have come otherwise is going to significantly boost your bottom line.
If you’re an executive at a chamber of commerce or you’re running a membership association, you can use the same principles for membership renewals and for membership engagement. You can get higher renewals and greater engagement with a personal call to action by text messaging and using mobile marketing.
Let’s look at a real life example. I want you to see 1 of my customers. I’m talking about an entire year, but in this slide, I’m talking about 30 days. This is a screenshot. It’s a little bit hazy, I know. It’s from 1 of my customers, the Tropical Smoothie Café. Marcus has been with me for about 18 months. He has about 4,500 people in his text program at this point. Check out these numbers in the last 30 days, roughly. This is June, so a little bit older than 30 days, but for a 30-day period. 519 people in that 30-day period earned a reward, that 1, 5, 10 that he has setup. 519 people earned a reward. 478 people came back to collect on that reward. That’s a 92% response rate. That’s huge. Virtually everybody’s coming back and collecting their reward.
Now, he’s also sending out … We built for him a very strong automated campaign. We know when people are checking in, how often they’re checking in, and we know when people are not checking in. When people haven’t checked in for 30, 60, 90 days, 4 months, 5 months, 6 months, they’re getting a specifically targeted text message to incentivize them to come back. All the way out to 6 months, it’s true. We’ve created those messages for him. Those messages go out, and look at this. 5.5% draw-back rate on people that haven’t come to his business. These are customers that have previously spent money with him, that have entered his loyalty program and have told Marcus, “Hey we want to engage with you. We want to hear from you. We want to hear about your business and your products and your services. Send us messages.” They haven’t been to visit him for up to 6 months. He’s getting at least 5.5% of people to come back.
Remember that Harvard study? If you can slow your loss by 5%, it means an extra 85% in revenue over the life of that customer. He is winning them back, and 5% is only on 6 text messages sent to people who haven’t checked in in 6 months. If you look at his whole year, he has got even a bigger draw-back rate than that. This slide is very, very difficult to read. What I want to show you here is that Marcus is getting relatively consistently 4 or 5% returns on text messaging. He is doubling his traffic. He is sending out thousands of messages. There’s 1 in particular I want to focus on. In the red box, he had a 12% response to that. I want to tell you what happened on that date.
Friday, June 19th, just after 10:00 in the morning, we sent out a message from Marcus. It went to 3,617 customers. What we found with that is he had a 12% redemption rate from his customers. That means 434 customers checked in on that day. That’s huge. Now, what it also meant is that he had a 339% traffic increase. Because we’re measuring how much traffic is happening on a normal day compared to a normal day in that week, he had an increase in traffic in the store of 339%. That’s 3 times, 3.3 times his normal traffic in-store. That’s absolutely incredible. Even if we don’t look at this day, and we look at the other days where he’s averaging 4% returns, he’s almost doubling the normal of this average traffic flow in his store simply by sending out a simple 1 text message on that day with a call to action.
Now, there’s something else which is not reflected in these reports, which is how many other people did these customers bring in. If I went in that day and I brought my son, maybe I checked into the loyalty system, but my son didn’t. How many of these customers brought in, these 434 people, brought in another somebody, and there’s a huge spillover effect. He’s making out a ton of money plus the spillover. It’s like this. I can use mobile marketing and text messaging to drive traffic in the door, but your customer service reps have to ask, “Do you want the stone massage instead of the regular massage? Do you want the aromatherapy? Do you want fries with that?”
The up-sell questions still have to be asked by your staff, but that’s huge. That’s just an amazing, amazing return. Let’s look at it in a slightly different way. We sent 3,617 text messages, got 434 people to come in and act on the offer. Now, in this case, it was a free smoothie. It was a donation that he was giving away for a charity cause. Here’s what we know. For whatever reason, and I have no idea why it is… I don’t know what the psychology behind it is, but most people buy something when they get something for free. Some people will walk away with the free thing, but most people will buy something. If his customers bought something with the free smoothie … If they came in for their free smoothie, and they bought a lunch item, a salad, a soup, a flatbread, a roll, a wrap, or something like that … I know from talking with Marcus that that most of the people bought something.
If they bought something along with the free smoothie at an average sale of 8 bucks, Marcus made almost $3,500 that day on 1 text. He made money on his customers are going to see roughly a 2-3 times return on investment when implementing a robust mobile marketing strategy with text messaging similar to what we did with Marcus and Tropical Smoothie Café.
We work with a lot of different businesses, right? This applies to restaurants and gas stations and co-op. The co-op is an average up 20%; Marcus’s store’s up 40%. The only thing that Marcus is doing different compared to everybody else, he’s using my mobile marketing and text messaging platform to boost his business.
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