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Ace Hardware mobile coupon pilot generates 49pc redemption rate

Ace Hardware recently wrapped up a trial as the first retailer to test a mobile initiative that tracks a coupon from discovery to redemption.

The hardware retailer ran a pilot program in northern California as part of a new mobile coupon specification from the Mobile Marketing Association’s mobile coupon ad units standards committee. The effort was aimed at building up Ace’s SMS loyalty program and increasing basket size.

“Mobile coupons are a proven way to generate leads,” said Adam Lavine, CEO of FunMobility, Pleasanton, CA

“Mobile coupons are a simple decision for a brand or retailer to make,” he said. “They just have to make it a priority and decide to do it. I tell marketers that the right mobile decision is a secret weapon, it’s just a matter of deciding and doing.”

Tracking the purchase funnel
The MMA is running a few trials with retailers to measure the effectiveness of mobile coupons from the discovery to redemption period. The goal behind these trials is to dole out simple offers that trigger shoppers to scan a mobile coupon in-store at the point-of-sale.

In-store and door signage as well as buttons on cashiers prompted Ace shoppers to text in a keyword to a short code to receive a coupon.

Once opted-in, geo-located coupons powered by FunMobility were sent to consumers that offered $10 off of a $50 purchase.

The average basket size for consumers that used a mobile coupon at Ace during the pilot hit $72, up from $18-20 without the coupon.

The pilot also points to consumers warming up to receiving mobile coupons as long as the offer is simple. Only two percent of consumers in the pilot declined to accept future promotions from Ace.

Consumers can opt-in to future mobile rewards

Expanded pilots
After the initial pilot in July, another trial is taking place this month with more than 20 additional Ace stores participating, per Mr. Lavine.

Jumptap will provide local mobile display ads to support the pilot, and the campaign’s creative is executed by Razorfish.

Motorola will donate in-store scanners to Ace locations so that employees can timestamp coupons and track redemption and purchase data.

“Mobile coupons are easy to update and change, so they are perfect for testing in-store promotions and offers,” Mr. Lavine said.

“Anybody can see the offers, and they can easily be rotated,” he said.

“This offer was a $10 off any $50 or more basket, and it boosted average basket size four times over normal. Everyone at Ace Hardware was blown away by the results.”

Final Take
Lauren Johnson is associate reporter on Mobile Commerce Daily, New York