Using Mobile to Upsell Retail Customers and Increase Lifetime Value

Posted on July 19, 2012

We’ve all been there, in front of a counter or with a waiter, taking our order, yet we’re not sure what we want or really what’s fully available. What we do know for sure is that we’re expected to make a choice, and we often times make a bad choice for us and a bad choice for the retailer.

I saw an application this week made by a Montréal company and it really made me think of how powerful mobile can be in enabling better decisions in retail contexts; and how that can lead to more upselling and increased customer lifetime value.

There are many reasons to bring mobile in to help with the customer ordering and the purchasing process in retail. Some of those reasons are to add depth to product information, or to speed the overall ordering process.

Yet for many, one of the holy-grails in retail has been to increase the average revenue of an order. The application I saw did this by allowing users to easily add more options to a base offering, and visualizing how tempting that looked, so you could experience some of the value before placing your order. Pure retail magic.

Some customers, when making a snap decision, will choose to go with a suggestion to maximize, other customers will automatically choose to minimize. Give the customer the power to make that decision, let them truly feel that they are empowered, and you will have a happier customer that over the long run will be happy to spend more. In the short term, they’ll probably choose to add another rasher of bacon or another handful of pecans.

Mobile can enable such services in a way that no other technology can. The ability to make decisions on the move, with location based services, store proximity and the availability of a service directly when a customer wants it, is a rather unique offer. Moreover, it’s important to remember that a mobile device is a device that is always on a person – it’s the one thing that you will not leave home without. Hence it’s the best place to be to build a relationship with your customer.

And once you know what they like to maximize, be it the avocado or the hemp seeds, you can provide more targeted products and customizations to them, on their personal devices during the buying process. This will lead to consistent opportunities to upsell and provide more revenue per customer.

Imagine you go to a salad bar, and you have more or less the same items everyday. At a certain moment you may get bored and decide to go elsewhere. What if the salad bar owner proposed slight changes to you? Will you get bored so quickly? Will you enjoy discovering new items? Can the salad bar owner increase your customer lifetime value?

Using new technologies such as Apple’s Passbook, it is also possible to make the purchasing experience or the loyalty card experience so much more frictionless too, augmenting even more that all important customer lifetime value.

There is definitely a lot of opportunity to increase customer revenue, upsell and improve relationships by augmenting retail experiences with mobile devices.

How do you see the future of mobile in retail?

Passbook Specialist Center for Business and Technical Support