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Join Our Research Team at DMA 2014
Oct 06, 2011
Case Study

Mobile Marketing: How Redbox drove 1.5 million texts and added 200,000 mobile participants in 10 days

SUMMARY: Mobile marketing is an increasingly effective way to increase foot traffic and interaction with customers, by combining the offline and online experience. This case study will look at a marketer that faced the challenge of having no employees at these locations to draw in people.

Redbox uses the mobile marketing channel to provide on-the-go customer service, and to help create an enticing reason to visit its DVD distribution kiosks. Find out how one 10-day promotion led to 1.5 million text messages and added 200,000 subscribers to Redbox's "Text Club."
by David Kirkpatrick, Reporter

CHALLENGE

Brick-and-mortar marketers have always tried to take advantage of their physical locations, and drive in foot traffic, using tactics ranging from eye-catching window displays to someone dressed in a bear suit dancing with a sign in the median of a highway. Mobile marketing tactics are the latest way to engage on-the-go customers and also combine the online and offline experience.

Redbox, a movie and game rental company, faced an even greater challenge than most consumer marketers. Its more than 27,000 point-of-sale locations are essentially vending machines, with no employees to entice potential customers, or offer personalized customer service.

Redbox 's solution is it uses the mobile marketing channel to not only enhance customer service, but also to create relationships between the brand and its customers.

"Mobile is like having a kiosk in your hand," explained Amy Gibby, Vice President Marketing, Redbox. "It's an incredibly important part of our (marketing) strategy."

This week's case study looks at Redbox's overall mobile strategy and one mobile promotion, "10 Days of Deals," that combined a clear call-to-action, a sense of urgency, and a gamification element to connect with new, and existing, Redbox customers at those 27,000 locations.

Find out how Redbox added 200,000 new participants to its mobile marketing list over a 10-day period.


STRATEGY

Before kicking off the "10 Days of Deals" promotion, Redbox already had a robust mobile channel in place with over 2.7 million subscribers in its SMS database, more than 4.5 million iPhone app downloads since December 2009, and more than 2.1 million Android app downloads since February 2011.

SMS subscribers are part of Redbox's "Text Club" and receive one free promo code each month, along with information about company deals not exceeding two messages a week.

All of these elements are part of a mobile strategy designed to counter some of the physical challenges presented by unmanned locations.

As Gibby put it, "We have to work harder, even when you are right on our front step, to engage you."


- Use the mobile channel to serve customers

All of Redbox's mobile efforts are based on the overall goal of fostering a personal connection.

Gibby said even though the company has more than 27,000 point-of-retail locations, those locations are still merely kiosks.

"It is the equivalent of a vending machine in any number of locations," Gibby added. "It doesn't have that human connection that a person behind the counter might have, and could shake your hand or give you a smile."

She stated engaging with a customer through the mobile channel offers access, connectivity and engagement with that customer.

She provided an example of using a mobile device to search for a location, search for a movie at that location, and actually reserve that movie to be held and waiting for the customer at the chosen kiosk.

For customers who have a regular kiosk to rent from, but find a wanted title out of stock, that customer can use a mobile device to find the next closest location with the desired movie.

So even though the actual physical location is simply an unmanned vending machine, Redbox customers can get services, such as finding the movie they want to rent that night, "on the fly" so to speak.


- Activate new customers at the point-of-retail

When you have a brick-and-mortar location with products and salespeople, getting new customers at the point-of-retail is just part of everyday business activity.

When your location is a vending machine most likely located inside, or even outside, of a big box retailer or a convenience store, grabbing the attention of those potential customers can be trickier.

Gibby said, "I want to get more out of this amazing foot traffic that is walking right past our business to activate and engage."

She considers email campaigns to be "pushing" a message out to the list. But where a mobile marketing effort with the call-to-action found right on the Redbox kiosk, the promotion is actually "pulling" new customers to engage with the brand.

The marketing team used its mobile strategies of providing customer service (in the form of a discount) and activating customers at the point-of-retail (through a clear call-to-action at the kiosk) to execute a relatively simple mobile effort.


CAMPAIGN

To create the pulling effect with mobile marketing, Redbox implemented the "10 Days of Deals" campaign where both current and new Redbox customers could send a text and immediately receive a code valid for anywhere between 10 cents and $1.50 off a rental.


Step #1. Define the rules of the promotion

Redbox made it very easy for anyone to participate in this promotion:

o A large call-to-action sticker was placed on Redbox kiosks

o Anyone could text "deals" to 727272

o Participants could text for one deal each day of the ten day effort

o The text would result in a randomly generated rental discount ranging from 10 cents to $1.50

o Participants wouldn't learn their discountís amount until they received the return text

o The promotion did include an opt-in element for Redbox's mobile marketing list


Step #2. Place the call-to-action in multiple channels

Because one key goal of the campaign was to engage with foot traffic around Redbox's kiosks, the most important call-to-action was a giant sticker that was placed on all the vending locations.

The sticker was very simple with a gift tag graphic and copy that read, "Save Daily!; TEXT DEALS TO 727272; For a Promo Code Now--May 25." It also featured a graphical element with copy, "SAVINGS VARY; 10₵ -- $1.50."

Redbox also promoted the effort with several posts to its Facebook page with three million fans, and an email blast the day the campaign launched to its list of over 30 million addresses.

Gibby said she actually views all three marketing channels -- mobile, email and social media -- as part of an integrated effort for connecting with, and activating, the customer base.

Although this effort is considered a mobile promotion because the cell phone was the device used to get the promo code, all channels, including the physical kiosk in this case, are involved in every marketing effort to reach Redbox's entire base.


Step #3. Make the entire process fun and create a sense of scarcity

By clearly limiting the timeframe of the offer -- 10 days in this case as represented by the promotion's title, "10 Days of Deals" -- Redbox was able to create a sense of scarcity and urgency in participants. Adding the daily element also encouraged repeat participation.


- Create a sense of fun

The gamification element of not knowing the exact discount until the return text arrives, described by Gibby as "like pulling the lever on a casino game," made the entire promotion fun for participants.

"We thought the gaming element of this campaign really resonated with our consumers," stated Gibby. "Having the codes delivered by text really makes it easy for them to use at their local kiosk on the go. Gamification of the consumer experience will be a big priority for us going forward."


Step #4. Take advantage of organic PR

Redbox released a traditional press release to announce the campaign with some outreach to entertainment and lifestyle media, as well as mom and deal blogs.

What happened is the media picked up on the campaign, and Redbox was featured in around 1,000 traditional and online media outlets. Gibby said the company obtained about seven million impressions from this organic media exposure.

The lesson here is you never know when a story is going to take off in the media, and it is a good idea to always be prepared to meet requests for more information or interviews. Organic PR can take off unexpectedly, but it can also disappear just as quickly if you aren't ready for an immediate response to media requests.

Even with the selective outreach, the Redbox team anticipated the promotion would gain media attention because of the consumer deal aspect of the effort.


Step #5. Take successful ideas from the campaign and continue to experiment with new efforts

Gibby said, "We have done a bunch of experimentation in mobile to just kind of get our feet wet."

For example, the short code was a major element in this campaign, so Redbox is looking into additional functionality with SMS, such as texting a short code to find a certain movie title, the nearest kiosk or what is coming soon from the company.

Redbox is also testing different calls-to-action against different business scenarios to find out what messaging is most relevant to consumers.

And because the "10 Days of Deals" brought new customers into the mobile database, Gibby stated the marketing team launched a new "welcome" series on the entire SMS list. This is part of an effort to manage the mobile list similar to an email communication strategy.

"We are finding that people who are on mobile are incredibly involved and engaged consumers," said Gibby. "[They] are very important to our business today, and I would assume increasingly so in the future."



RESULTS


Gibby said Redbox was looking at several key performance indicators with the campaign including the scale of the effort in how many texts were generated, how many unique customers participated, how many new subscribers were added to the mobile "Text Club," and how valuable were the mobile customers.

Over the ten days of the promotion, the effort:

o Generated 1.5 million text messages
o Included 400,000 unique customers
o Created 200,000 new SMS subscribers

Gibby added that analysis on Redbox's customer base has found those part of the SMS program are the company's most valuable customers. She was very pleased with all three metrics from this campaign and said Redbox was able to increase its most valuable customer base "at a scale that made my jaw drop."

Gibby also offered her takeaway on how mobile marketing has become a major channel for Redbox.

"Movies and games are inherently social, and there is so much we can do with mobile to interact and establish relationships with consumers, and kind of launch this slippery slope towards renting." Gibby stated. "Mobile is the premier device for that, no question."

One final result is the initial "10 Days of Deals" promotion was considered such a success, Redbox has since repeated the effort.


Useful links related to this article

CREATIVE SAMPLE: Kiosk sticker call-to-action for campaign

Redbox

Get Started in Mobile Marketing: 4 Insights to Guide Your Strategy

Mobile Marketing: New program achieves 11% redemption rate on text offers

Mobile Email Marketing: 5 tactics to engage and convert smartphone users

Mobile Marketing 101: Should you make the leap to a custom mobile site?

Mobile Marketing 101, Part 2: Ease of use and quality of content are key

Mobile Website Optimization: The growing impact of mobile search


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