Mobile Strategy - Research Paper Example

Mobile Strategy Name Course Lecture Date Contents Contents 2 Methodology 3 References 12 Introduction This forthcoming research aims to explore how Starbucks has been successful in using mobile strategy in the local market in both China and in the United States. The primary intention of this research is to offer valuable insight on how organizations can make good use of mobile strategy to enhance their business and attract more customers. Defining key terms The rise in the use of smartphones, mobile internet access and apps has made mobile phones key battlefields in the fight for new customers and business. People primary attraction to mobile technology is because; mobile phones are always switched on and that individuals usually have them on their hands. In regard to this research paper, the definition of mobile strategy that will be adopted is the one used by Kaplan 2012 who defines mobile strategy as marketing activities that are conducted through the use of ubiquitous networks in which consumers are always connected to for example, smartphones. Methodology Case study analysis and other secondary sources of information will be deployed so as to bring accurate and relevant information relating to the use of mobile strategy in China and United States by star bucks. The case studies to be utilized will include: Case study China and Case Study USA Rationale In relation to technological advancement, mobile strategy is being adopted by companies at a speedy rate (Lewis 2001). Earlier research focuses more on other forms of strategies and excludes mobile strategy since some companies are still embedded in the traditional marketing tools such as print adverts, public relations, and advertising. With the technology advancement, there seems to be an urgent need for study and research in mobile strategy (Helft & Vance 2010). This research, therefore, sets out to show how Starbucks has been successfully using mobile strategy in the local market in both China and in United States. Literature review The New York Times announced that the walls street had called for an end of the previous era and starting of a new one. The new era stipulates that technology products are supposed to fit in one hand, and this is contrary to the previous era technology products that sat on the desktops (Helft & Vance 2010). As a matter of fact, mobile phones have become the most prevalent tool for media communication and consumption globally. Currently, there are 4.6 billion phone subscriptions that are currently in use. This seems to be a significant figure when compared to the 1.2 billion personals computers that are being used (Henning 2010). A lot of research has been conducted regarding the aspect of in the way consumers are willing to receive marketing communications from mobile devices. Barwise and Strong 2002, asserts the fact that, mobile phones could be used as effective tools for reaching consumers and that consumers could respond positively to marketer’s messages. This is further supported by a study carried out by Lewis 2001, and the study found out that, US consumers are usually receptive to mobile strategy when it offers lesser when the costs associated with other mobile services. A significant finding is that, the condition is consumer permission and control (Carroll, Barnes, Scornavacca, and Fletcher, 2007; Peters, Amato, and Hollenbeck, 2007; Tsang, Ho, and Liang, 2004). Younger consumers are more willing to accept mobile marketing and respond positively to the promotion. Bauer et al. (2005) studied consumer acceptance of mobile strategy as a marketing tool. Unlike the previous studies, the framework of this study was based on an online survey of people who totalled to 1,028. The results of the study showed that, high levels in regard to consumer innovativeness leads to higher knowledge levels relating to mobile strategy. A positive attitude toward mobile marketing when coupled with the perception of the various social norms has a great influence on individual’s intention of adopting mobile marketing. The main goal of an integrated marketing communications is to make use of the best possible combinations of the available tools in a well coordinated strategy with the aim of achieving the objectives of the organizations. Mobile channels have been found to communicate to the consumers in an engaging and unique way (Sinisalo and Karjaluoto, 2007). The mobile strategy also seems to pose some benefits, and these benefits appear to be similar to the ones offered by internet channels such as blogs, email, and websites. A major advantage is that, it provides high levels of interactivity, the information is usually personalized and there is a combination of user content, music and video (Schultz & Bailey 2000). Thus, it would be essential for companies to make good use of mobile strategy so as to achieve the perceived benefits of the approach and be ahead of the competitors always in terms of promotions and advertisements. If marketers can capitalize on creating value for their consumers, the mobile strategy can be a successful strategy that can be essential in the operations of their respective organizations. Research From the USA case study, Starbucks makes use of the mobile orders and payment applications. Over the years, Starbucks has been able to gain substantial market shares, and they have been able to achieve these by catering specifically to their target audience in the USA. Strabuck’s has been able to make their services more appealing to their target markets that are men and women between the age of 25 and 40 and they have done so through the introduction of digital technology. The China case study focuses more on the Starbucks Good Morning Smartphone App; the case study shows how the mobile strategy can be effective in gaining customers and gaining a competitive advantage over one's competitors in the market. Based on Starbucks manager the company engages with customers differently in various parts of the globe but the mobile strategy can be applied all areas in the world. Brennan and Schafter 2010 shows how retailers are engaging the consumers who are technologically savvy through the use of social media and mobility. It further shows how Starbucks mobility initiatives are related to the individual personality of their respective company. Niemeier, Zocchi and Catena 2013, shows that, retailers need to make good use of consumer data in creating value for the consumers and the retailers through the use of mobile technology in their products to their target market. Rowles 2014 further asserts that, mobile marketing is revolutionizing communications, marketing, and advertising. He argues that, people tend to be spending their daily time on mobile devices as compared to the time they spend on TV. Thus, marketers need to be more focused on mobile marketing. He further offers a clear and concise understanding of what mobile consumers aims to achieve of the change in technology and adoption, platforms and devices. Through the combination of both theoretical and practical exercises, Rowle is able to show how marketers can build top-down strategy that encompasses all the touch points of consumers so as to future-proof businesses besides the ever changing mobile interactions of consumers. Jin 2014 also offers a plan that other companies can apply. He urges others companies to follow the example of Starbucks so as to take their brands to greater heights even beyond with the already proven mobile approach. Marketers in all industries need to engage in the same level of sophistication in mobile creativity and take advantage of the user engagement and full-screen capabilities that are used by Starbucks through the use of Mobile Rich Media Definitions. Based on the article by Wohlsen 2014, the mobile app applied by Starbucks seems to be successful as compared to other applications used by other companies. For instance, about 90% of the mobile payments that were made in 2013 were made at Starbucks. Farrell 2015 shows how Starbucks have been able to gain a large market share, and they have been able to achieve these by catering for a well-defined target audience. In the US, Strabuck’s have a 33% market share and it sells coffee that can amount to that which is sold in convenience stores and fast foods combined even though a great number of their consumers are in suburban areas and the cities. Elgan 2014, also states that, the main difference that exists between Starbucks and other coffee sellers is its use of technology. At first Starbucks, was jut selling coffee but currently, it is a technology company since it makes use of wireless charging. Martyn 2014 asserts that, one in every six payments to Strabuck’s is made through mobile. Mobile payments are augmenting in a massive way, and Starbucks is handling payments that are almost totalling to 7 million in one week in their US coffee shops. This accounts for about 16% of all the transactions in the store (Martyn 2014) Findings The above research reveals that Starbucks has been successful in the use of mobile strategy both in China and the USA. The selected case studies and additional sources reveals the fact that, mobile strategy is slowly becoming an essential aspect of communicating with the consumers and that for companies to succeed in this new era, they need to embrace it (Schultz & Bailey 2000). For instance, based on Martyn 2014, Strabuck’s seems to be making mobile payments that amount to almost 7 million in a week in their coffee shops that are based in the US. The older advertising tools are slowly being replaced by new tools that seem to be well fitted to the modern society. With the decreasing number of hours that people spend on the TVs and radios nowadays, marketers seem to be shifting to more applicable advertising tools to meet the needs of consumers (Rowles 2014). This has been done through the development and application of mobile strategy by modern day marketers. Other companies such as Apple and Amazon are also making good use of the mobile applications in making their sales. But in totality, the sales made by Starbucks surpass those that have been made by Apple. Starbucks is a Food and Beverage Company and the commodities it sells to the consumers are required on a daily basis and this makes it possible for Starbucks to receive high sales since the company deals with people who are more likely to make purchases on a daily basis. As it is usually the case with the evolving technologies, practice advances before the theory is developed. Companies predispose to risk taking and innovation for example Starbuck's are the ones who are more willing to launch consumer communications through the use of mobile channels. They do so with the hope that they will gain a first mover advantage in the new and yet to be uncluttered medium. Starbucks has also been successful in making use of the mobile strategy in China and the USA in that, even prior to the emergence of cards, they had their in-house cards that enabled consumers to make purchases (Niemeier, Zocchi and Catena 2013). This played an essential role in the mobile strategy in that, even when they introduced the mobile strategy, the consumers were ready to make use of them and the associated application in making purchases. Starbucks has been successful in using the mobile strategy since they have a well-defined target audience in both the USA and also in China. The main target group of starbucks is men and women who are between the ages of 25 and 40 years. By application of digital technology, Starbucks seems to be more appealing to their target audience. The mobile application has also been successful, and it is also currently been applied beyond the test market. This show how successful Starbucks has been in implementing the mobile strategy. The use of the application has been successful due to the convenience it offers to the consumers in terms of order pick up time (Brennan and Schafter 2010). Through the use of the application, Starbucks can obtain precise data in how their consumers shop and this allows them to personalize their marketing and deal with each customer precisely. The mobile strategy has also been successful in China due to the 50% discount that is usually offered on all breakfast items. In relation to the findings and success of Starbucks in using mobile technology, it would seem logical for marketers and their company managers to adopt the mobile strategy. By doing so, they are likely to achieve the benefits associated with the strategy and they are more likely to reach a greater target audience as compared to when they are making use of other tools such as radio and television adverts. Conclusion and direction for future research The research reveals that, the mobile strategy is slowly taking velocity in the modern business world. Companies, therefore, need to embrace the mobile strategy, and they can replicate or develop applications that are similar to the one that is being used at Starbucks. Through the use of the application, the consumers do not have to waste time in making queues to make their orders. This in a way saves them time, and it is also beneficial to Starbucks. Future research in this area should focus more on conducting research and make use of interviews as the source of their information. By using interview, the data and information that will be derived will be accurate and will, therefore, offer useful insights into the use and application of the mobile strategy in companies. As a matter of fact, the wireless advertisers are likely to face a number of technical challenges for example inconsistent formatting of the adverts, small screen making the ads less visible and slow download rates and the varying of technological standards globally. Thus, future research needs to rely more on offering guidelines to the marketers and intermediaries so as to avert the associated risks of mobile marketing. Finally, as it is common with marketing communication, no amount of promotional strategy or creativity can be equivalent to failing to meet the need of the consumer. The technological and creative potential of the mobile strategy can divert the attention of the management team away from the essentials. An iterative process of theory, research development and application will enable the mobile strategy to reach its potentials. References Barwise, P& Strong, C 2002, ‘Permission-based Mobile Advertising’, Journal of Interactive Marketing, vol. 16, pp. 14. Bauer, H.H., Stuart J. B., Tina R. & Marcus M 2005, ‘Driving Consumer Acceptance of Mobile Marketing: A Theoretical Framework and Empirical Study’, Journal of Electronic Commerce Research, vol. 6, no. 3, pp.181-191. Brennan B & Schafer L 2010, Branded! How Retailers Engage Consumers with Social Media and Mobility, Wiley, New Jersey. Carroll A., S, Barnes, E, Scornavacca, K & Fletcher, A 2007, ‘Consumer Perceptions and Attitudes towards SMS advertising: Recent Evidence from New Zealand’, International Journal of Advertising, vol.1, pp. 79-98. Elgan M 2014, Forget coffee, Starbucks is a tech company, Computer world, viewed 27 May 2015, May 2015, < http://www.computerworld.com/article/2490746/retail-it/forget-coffee-starbucks-is-a-tech-company.html>. Farrell R 2015, Who Is Starbucks' Target Audience?, Chron, Hearst Newspaper, viewed 27 May 2015, . Helft, M & Vance, A 2010, Apple Passes Microsoft as No. 1 in Tech. The New York Times, viewed 27 May 2015, . Hennig, N 2010, It's a mobile world, where do you fit? MIT Libraries, viewed 27 May 2015, . Kaplan, A 2012, ‘If you love something, let it go mobile: Mobile marketing and mobile social media 4x4 Found’, Business Horizons, vol. 55, no. 2, 129-139. Lewis, S 2001, ‘M-commerce: Ads in the Ether’, Asian Business, vol. 37, pp. 31. Martyn W 2014, “Starbucks says 1 in 6 payments already mobile”, CMO, viewed 27 May 2015, . Niemeier S, Zocchi A & Catena M 2013, Reshaping retail: why technology is transforming the industry and how to win in the new consumer driven world, Wiley, Hoboken. Peters, C, Amato, H, & Hollenbeck, R 2007, ‘An Exploratory Investigation of Consumers’ Perceptions of Wireless Advertising’, Journal of Advertising, vol. 4, pp. 129-146. Rowles D 2014, Mobile marketing: how mobile technology is revolutionizing marketing, communications, and advertising, KoganPage, London. Schultz D & Bailey S 2000, ‘Customer/brand loyalty in an interactive marketplace’, Journal of Advertising Research, vol. 40, no. 3, pp. 41–52. Sinisalo J & Karjaluoto H 2007, ‘Mobile customer relationship management – a communication perspective’, International Journal of Electronic Customer Relationship Management vol.1, no.3, pp. 242–257. Soo, J 2014, From Coffee to Mobile King: How Starbucks Serves up Its Mobile Strategy, Marketing Land, viewed 27 May 2015, . Tsang, M & S. Liang, H 2004, ‘Consumer Attitudes toward Mobile Advertising: An Empirical Study’, International Journal of Electronic Commerce, vol. 3, pp. 65-78. Wohlsen M 2014, The Master of Mobile Payments Is Starbucks, WIRED, viewed 27 May 2015, . Read More