Date: 5/21/12
Price: Free
SmallCap Network provides comprehensive research and opinions on SONC, MUR, MCD, CCLR and MFON.
How to Tap Mobile Market's Newest Venue: CCLR, MCD, SONC, MFON, MUR
Score another one for CommerceTel Corporation (OTC:MFON). In fact, today's score may just be the warm-up, if the company does for a new venue what it's done within the restaurant arena. MFON has already serviced names like McDonald's Corporation (NYSE:MCD), Sonic Corporation (NASDAQ:SONC), and most recently, Chanticleer Holdings' (OTC:CCLR) Hooters Restaurants in South Africa. As of today though, CommerceTel has cracked the gas station nut.
Though nowhere near as deep into mobile marketing as food service companies have been, it's not like fuel stations are complete strangers to the premise - and promise - of using smartphones as a marketing medium. Murphy Oil Corporation (NYSE:MUR), as an example, dove into the text message game back in 2010 with a gas-price alert that was ultimately intended to drive foot traffic into the gas stations' stores via coupons sent to the same self-selected smartphone users. It was considered a big success.
Super Stop USA did something similar in 2008 - well before smartphones were the norm - when it offered a free text alert before a price hike. The gas station said the response rate (those who made purchases of gas based on the included coupon offer) was 20%, which is very strong by mass-marketing standards.
Still, it's nowhere near the utilization/success rate that quick-service restaurants like Sonic Corporation and McDonald's Corporation have enjoyed. McDonald's unveiled an app in the middle of lat year that informs hungry smartphone owners of the restaurant's nutrition and diet information, and just so happens to hook those people into visiting the nearest McDonald's. Previous similar SMS efforts from McDonald's, when combined with a coupon or special offer, have shown an amazing 25% response rate.
Sonic Corporation - as in Sonic Drive-In Restaurants - has also found big success with text message and mobile marketing efforts, much of it thanks to services performed by CommerceTel Corporation. The pilot program for mobile ordering is getting traction, and the bigger mobile/SMS effort taken on in 2009 has shown a tremendous ROI... up to 20 times as strong as a comparable e-mail or direct mail offer.
But can gas stations experience the same kinds of success that restaurants have already enjoyed by employing mobile marketing? With help from CommerceTel Corporation and its online, real-time sending 'C4' software platform, yes. It's the same basic customer after all.... someone likely to be in their car, or at least on the go. And, it's someone who's thinking price-consciously but probably isn't willing to drive across town to save a few cents - location is still critical The same price/location balance that makes restaurants such successful users of real-time offers also applies to customers looking for a deal on gas, but aren't looking to go on a mission.
As for the fiscal benefit MFON may find by making this stand within the gasoline industry, that's a topic we broached last Thursday after CommerceTel Corporation announced it had signed a deal that would give the company another 1600 'stand alone' restaurant customers [same chain, but 1600 different locations, each of which needs their own account]. Based on competitive research done at the time, we calculated each location's account would yield a minimum of $50/month in revenue. At $50 each times 1600 units, that could translate into monthly revenue of $80,000 ($960,000 per year). That's not bad for a company that did $1.8 million in sales for the past twelve months.
Now the total number of customers being added is 10,000, and since each of them is geographically unique - and won't be offering the same gas prices - they'll each need a unique account as well. Again, at $50 each per month, this could translate into half a million additional bucks in monthly revenue. That's $6 million per year.
As was the case last Thursday, those are strictly our numbers, and it should be noted that the gas station chain is going to roll out its usage of the C4 platform gradually - CommerceTel won't be collecting that much revenue starting immediately. Still, it's a great start, and it opens the door for another big mobile marketing venue that's barely been tapped yet.
Though nowhere near as deep into mobile marketing as food service companies have been, it's not like fuel stations are complete strangers to the premise - and promise - of using smartphones as a marketing medium. Murphy Oil Corporation (NYSE:MUR), as an example, dove into the text message game back in 2010 with a gas-price alert that was ultimately intended to drive foot traffic into the gas stations' stores via coupons sent to the same self-selected smartphone users. It was considered a big success.
Super Stop USA did something similar in 2008 - well before smartphones were the norm - when it offered a free text alert before a price hike. The gas station said the response rate (those who made purchases of gas based on the included coupon offer) was 20%, which is very strong by mass-marketing standards.
Still, it's nowhere near the utilization/success rate that quick-service restaurants like Sonic Corporation and McDonald's Corporation have enjoyed. McDonald's unveiled an app in the middle of lat year that informs hungry smartphone owners of the restaurant's nutrition and diet information, and just so happens to hook those people into visiting the nearest McDonald's. Previous similar SMS efforts from McDonald's, when combined with a coupon or special offer, have shown an amazing 25% response rate.
Sonic Corporation - as in Sonic Drive-In Restaurants - has also found big success with text message and mobile marketing efforts, much of it thanks to services performed by CommerceTel Corporation. The pilot program for mobile ordering is getting traction, and the bigger mobile/SMS effort taken on in 2009 has shown a tremendous ROI... up to 20 times as strong as a comparable e-mail or direct mail offer.
But can gas stations experience the same kinds of success that restaurants have already enjoyed by employing mobile marketing? With help from CommerceTel Corporation and its online, real-time sending 'C4' software platform, yes. It's the same basic customer after all.... someone likely to be in their car, or at least on the go. And, it's someone who's thinking price-consciously but probably isn't willing to drive across town to save a few cents - location is still critical The same price/location balance that makes restaurants such successful users of real-time offers also applies to customers looking for a deal on gas, but aren't looking to go on a mission.
As for the fiscal benefit MFON may find by making this stand within the gasoline industry, that's a topic we broached last Thursday after CommerceTel Corporation announced it had signed a deal that would give the company another 1600 'stand alone' restaurant customers [same chain, but 1600 different locations, each of which needs their own account]. Based on competitive research done at the time, we calculated each location's account would yield a minimum of $50/month in revenue. At $50 each times 1600 units, that could translate into monthly revenue of $80,000 ($960,000 per year). That's not bad for a company that did $1.8 million in sales for the past twelve months.
Now the total number of customers being added is 10,000, and since each of them is geographically unique - and won't be offering the same gas prices - they'll each need a unique account as well. Again, at $50 each per month, this could translate into half a million additional bucks in monthly revenue. That's $6 million per year.
As was the case last Thursday, those are strictly our numbers, and it should be noted that the gas station chain is going to roll out its usage of the C4 platform gradually - CommerceTel won't be collecting that much revenue starting immediately. Still, it's a great start, and it opens the door for another big mobile marketing venue that's barely been tapped yet.
Matthew Briar is a paid contributor of the SmallCap Network. Matthew Briar's personal holdings should be disclosed above. You can also view SmallCap Network's complete disclaimer and disclosure.
