You've Tested, Now What?

The results of Shopper Marketing and the Path to Purchase Institute’s Mobile App Survey published in February revealed cautious yet optimistic attitudes toward third-party mobile shopping apps, with many of the respondents saying they still considered themselves to be in a test-and-learn stage with most technologies.The concept of “test and learn” is nothing new. Testing on a small scale and rolling out on a national or much larger scale has been part of marketing forever, says Matthew Barksdale, president, Engage Mobile Solutions, Kansas City, Mo. “That’s the philosophy. But the whole thing about mobile is that the cost and time to do it is shrunk by 1,000%. You can test today and tweak tomorrow.”The ease of execution, the low investment and the quick data empowers brands and retailers to get quick bumps and multiple shopper learnings. But with mobile, many never want to leave the comfort of test-and-learn. “The pitfall is often a culture of test-and-learns for their own sake, and there’s no drivetrain connection between a super successful pilot and making it a core pillar of your business strategy,” says Bryan Leach, CEO of Ibotta, a Denver-based third-party mobile app.He says a company needs to structure a test along the way so that when it becomes successful and the technology is a “yes” to go forward, the company knows what to do next. “Sadly, there are a lot of companies that have hired someone to marshal the budget for test-and-learn or innovation, but they don’t empower those people in nearly the right way. They end up shouting into the wilderness.”Alexis Rask, chief revenue officer at Shopkick, Redwood City, Calif., agrees that a big issue with moving beyond a test is who owns the budget. She says there are rules about how to use budgets, particularly if the innovation department has partnered with another department or company, and it becomes unclear who owns the project and who can continue funding.Leach says a company might pilot a successful test but then needs to wait nine months for additional funding. It falls into a holding pattern while the technology evolves, improves and addresses a different company’s requests, he says. “You sit on the sidelines for six months, and instead of being decisive after a test, goodness knows how many features and benefits you’re not even testing anymore. You’re studying an old EKG report.“You need to be decisive. Go big on the winners, cut bait on the losers, agree on the KPIs [key performance indicators] up front, put in place a system that empowers people to take the next steps, and then you need to follow through.”Stalled By Metrics, KPIsJohn Milinovich, CEO of San Francisco-based URX, a mobile company that provides the ability to “deep link” mobile display ads, says some brands or retailers may not be in a position to continue a test because they don’t have a strong measurement practice in place. He says a client may know what the goals are but not have a clear way of measuring them. “We’ll get a, ‘Yes, but we can’t use this until we get our house in order with data.’” Internal measurement practices may include a software conversion tracker or an in-app analytics product, he says.Deep linking as a technology is less than nine months old. It gives marketers the ability to retarget consumers who already installed their app. For example, SeatGeek, an engine that aggregates ticket prices online, can place a display ad into the Words With Friends app with a message about a musical group the user previously searched for, and the display ad deep links the person back inside SeatGeek in the spot to buy.Russ D’Souza, co-founder of New York-based SeatGeek, says his company is in a unique position, though. They have a clearly defined goal of moving tickets. “We want X% return over X amount of time,” he says, whereas he says it’s more difficult for a CPG brand to leverage mobile. “Their KPIs are so fuzzy. If you’re Procter & Gamble, what are you really trying to accomplish with a mobile campaign? What is your mobile app doing for your business?”Ultimately, money talks. According to Tom Spier, co-founder of frozen foods manufacturer Evol Foods, “If it doesn’t ring the register, I tend not to be excited about it.” (Evol Foods was sold to Boulder Brands in December 2013. Spier, formerly chairman, has since founded an investment firm Spier Capital that actually has a stake in Ibotta.)Leach’s opinion on metrics: “[Ibotta] brings clarity to KPIs because it’s all grounded in real purchase.” He says the offline world struggles with that and settles on “squishy” metrics such as impressions and “Likes.”Shopkick’s Rask says KPIs for a test can vary. “Did it drive foot traffic to a store? Were there in-aisle connections with manufacturers and consumers? It could also be as simple as, did the organizations work well together? As a day-to-day operation, was it a relationship that was constructive, repeatable and viable for both sides?”Signs of SuccessNew mobile companies seemingly enter the market monthly, but there are watchouts. “We look for mobile technologies that offer scale and are frictionless,” says Janelle Anderson, senior director of marketing, Frito-Lay. “Frictionless means the mobile solutions tap into and encourage an existing shopper behavior. We are not asking them to learn a new behavior to engage with us via the mobile platform.”She says her team does a lot of research up front to understand shopping behaviors and how different technology platforms align with those behaviors. This research helps Frito-Lay get smarter before getting into a room with a mobile technology company, but it also helps them build a strategy before they begin testing that can power a test phase smoothly into wide-scale deployment, she says. “For this reason, we keep a keen eye on platforms that are growing and offer scale.”The biggest complaint from respondents of Shopper Marketing and the Path to Purchase Institute’s survey was that there wasn’t enough “scale at present for CPG.” Spier says that eventually “there will be a dozen or so that stand out and move the needle. The other 100, 200 or 500 will go away, because they don’t have users and they don’t have enough content.”Ibotta’s Leach suggests that a brand should look at a new technology and the results of its test through a series of questions:Is this a goer? Does this service add value? Does it prove a measurable result you care about (i.e., sales lift)?Does it have a reach that’s worth your time?What does the consumer think? What does the retailer or other key stakeholders think?Is there anything the brand is currently spending money on now that is less efficient and can be replaced by this technology?Leach says a brand can then scale up a test and build a deeper relationship. “If the end goal is to just have run a test so you can say you’ve tested everything: ‘Oh, yeah, I tested Kiip, I tested Foursquare, I tested Shopkick,’ then your mental model is just to look at how ‘innovative we are.’ But if you actually set a goal to drive a step-function change in your business, then it’s finding a tool, a good one, and making the most out of it.”Says Shopkick’s Rask: “It’s not just about what you agree with up front, it’s agreeing about the journey.” And to her, the litmus test is: “Could they take the results to their leadership with pride? Are these the results that can get someone promoted? If the answer is ‘no,’ then it’s not enough.”

You've Tested, Now What?

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