Will Apple and Google Rule Customer Loyalty in Mobile?

Smartphones have changed forever the information consumption habits of consumers. While those changes are most obvious in areas such as social networks, the news media and search engines, they have been perhaps most impactful in the retail industry. To find a shop, film, restaurant or the latest fashions, smartphone owners no longer hesitate to use their mobile devices.

The most observed search behavior among mobile users is the research of products, retailers and promotions. These activities usually are undertaken for very specific reasons:

Location of products and services locally. These users want to find a place close to their location offering the product or service they are looking for.

Comparison of products and services. Mobile devices deliver information about products and services and allow users to compare them before they buy.

Reviews and comments. By reading the views of others, shoppers can reassure themselves they are making the right choice.

The remaining loyalty uncertainty

Another desire of consumers is to be able to rid themselves of the cards and other material that is part of loyalty programs and to instead carry that information in their smartphones. Over the last few years, organizations have offered alternatives.

These include umbrella apps like FidMe and Key Ring, in which customers assemble loyalty cards and vouchers. Of course, retailers have offered their own apps that integrate loyalty component with a direct payment capability. However, except for Starbucks, which invested heavily in its effort, few of these initiatives have met with success.

Umbrella apps have been hurt by inadequate marketing, and development time has been squeezed by the rapid evolution of Android and the IOS. Those are difficult obstacles for start-ups. Meanwhile, many retailers apps suffer from slow download rates. This leaves these apps appealing only to those advanced users interested in abuse and profit.

Apple and Google have arrived

The good news is that Apple announced this summer the launch of its own umbrella app, Passbook. Passbook allows for the management of loyalty cards and coupons as well as cinema tickets and boarding passes for train and planes. This multiple use app is included in the IOS6 program and will be updated automatically. Meanwhile, Google has announced an important update to Google Wallet that will add loyalty card and coupon management to the mobile payment program.

Both companies are responding to customer demand for a mobile way to centralize loyalty program participation and a call from retailers for an easy way to organize and analyze sales and activities. As these tools are coming from the biggest players in the mobile web, we can be confident that innovation will be constant.

Georges-Alexandre Hanin is the founder of Mobilosoft.

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