Sep 27, 2016 | Customer Loyalty News

Why Mobile is Not a "Check-the-Box" Initiative — FSTEC 2016

by  Margaret Link — Marketing at Thanx

Thanx CEO Zach Goldstein spoke to the theme of "Untangling Tech" at FSTEC 2016 — presenting to restaurant owners and operators, he made a case for why a brand's mobile presence cannot be a "check-the-box" initiative.

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Brands are rushing to create mobile apps, then failing to execute well. 

Big players like Starbucks and Chick-fil-A have very successfully ventured into the world of mobile apps. Whether measured by usership, engagement, or data, these brands have set the tone for consumer expectations:

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From Zach Goldstein's FSTEC 2016 presentation: "Why Mobile is Not a Check-the-Box Initiative"

Other restaurants see these top brands foray into mobile and immediately are struck with a yearning for the same level of success: "We should be doing that!"

However, it's not so simple. The app store is a highly competitive marketplace, where many enter and few win — smaller brands often sink resources into custom-building an app before they're clear on an objective beyond "we need an app, too!"

Unfortunately, this leads to low-quality apps without much of a purpose (and, as a result, not much consumer demand). These apps aren't there to enhance user experiece; they exist as a "check-the-box" initiative.

As a result, good brands have saddled themselves with bad apps — in an sampling of 150 restaurant apps, the average star rating was 2.9. Most restaurant operators would be unsatisfied with a 2.9 star review on Yelp, so why is this low standard of quality acceptable in the app store?

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From Zach Goldstein's FSTEC 2016 presentation: "Why Mobile is Not a Check-the-Box Initiative" 

Ultimately, bad app experiences are a detriment to a brand's image. Consumers have no tolerance for bad mobile experiences — they're ruthlessly selective about which apps they download and even more selective about which apps they KEEP on their phones. The average number of apps used by the typical American smartphone owner is 27 — and has been that way for FOUR. YEARS. STRAIGHT (source: Nielsen). Bad apps get downloaded, opened once or twice, and then quickly discarded to make room for other applications. Rinse, and repeat.

Consumers will ask themselves these questions before deciding whether to download and keep the app

    1. Does it make my life easier/provide continued value?
    2. Does it provide a joyful experience?

 Understanding that consumers are fickle and that their app presence needs to impress in order to pay off, how do brands make sure that they're investing in apps that achieve their objectives? First, let's consider the keys to mobile success (we'll use the acronym SBUCK to channel an especially well-done mobile app experience):

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From Zach Goldstein's FSTEC 2016 presentation: "Why Mobile is Not a Check-the-Box Initiative" 

 

Start with your top customers

First, think about your target audience. Who do you imagine will download this app? 

Most likely, it'll be your VIP customers: a small group of customers who drives the majority of your revenue (in fact, the top 10% of customers drive almost 40% of all revenue). If you're going to please a group of customers, let it be this group! The objective now becomes to enhance the experience of your best customers, and invest in communicating with this hugely valuable demographic.

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From Zach Goldstein's FSTEC 2016 presentation: "Why Mobile is Not a Check-the-Box Initiative" 

 

Build basics on mobile web

A huge mistake that brands make when embarking upon the app journey is REDUNDANCY. Don't create an app where the mobile web will suffice. Apps should provide additional functionality, not just be a less convenient way to access information that's already available on the web. As we say, know your channel. Here's a handy guide for which types of info/function belongs where:

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From Zach Goldstein's FSTEC 2016 presentation: "Why Mobile is Not a Check-the-Box Initiative" 

 

Utilize app-only tech

Now that you're zeroing in on what makes apps appealing, make sure that your app does those things really well! Utilize things like beacons and push notifications to create a unique app experince that keeps customers engaged. Provide value through the app — communicate with customers instantaneously and solicit feedback. A brand's app should be a feat of technology, not just a copy of what's already on the restaurant website. The app needs to continue to offer value to the customer or it'll quickly get deleted. 

One of our favorite examples (and our customers' favorites, too) is the use of push notifications. Restaurant apps with push notification capabilities are able to generate SIGNIFICANTLY more user engagement than brands who communicate through email. Better still, push notifications that are tied to user behavior: purchase history, feedback, or location data are great examples. Customers repond to communication that is relevant and urgent (which is why push notifications have open rates of 50-80%, whereas email marketing campaigns in the restaurant industry have open rates of around ~20%). 

 

Complement existing behaviors instead of forcing new ones

Customers are people. People are lazy. We take the path of least resistence, and often defect from behavior that causes us to jump through hoops. 

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From Zach Goldstein's FSTEC 2016 presentation: "Why Mobile is Not a Check-the-Box Initiative" 

 When the centerpoint of a mobile app experience requires consumers to perform some task every time they transact, they'll quickly grow tired of the exercise and choose not to engage. The worst offenders? QR codes that require scanning, check-ins that require broadcasting location information, and other manual processes like having to take a picture of your receipt every time you dine. 

Take a step back. Mobile apps are only as good as the experience they provide customers. At the end of the day, your customers will continue to engage with the app if it provides value to their lives, and creates joy and pleasure.

 

Keep it simple, Stupid

Let's take a moment to try to decode Chipotle's 2016 Summer rewards program, Chiptopia

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Give up yet? Me too, and I love free burritos. Guests shouldn't be intimidated by the structure of your loyalty program or how your app works — they should perceive the process of participating in your loyalty program as simple, delightful, and valuable. At Thanx, we look at crazy schemes like this and say: "make it easier". 

Our customers agree, which is why they decided to cut out the noise and implement seamless, frictionless mobile loyalty experiences for their guests. Pay as usual, and get rewarded on your smartphone. No check-ins, QR scans, or phone number entries required.

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Building a mobile presence for your brand should be more than just an afterthought — it should be a deliberate, well thought-out, and additive to the customer experience. At the very least, failing on the app front is a missed opportunity to connect meaningfully with customers and build long-term loyalty. At most, bad restaurant apps are a customer experience failure and an absolute waste of resources.

See the full slideshare here: Why Mobile is Not a "Check-the-Box" Initiative

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