QR Codes: Cracking the (QR) Code
As we reach the midpoint of 2011, it's clear that mobile has become a formidable marketing channel and will continue to blaze its trail into retail. Nielsen predicts that by the third quarter of 2011 smartphones will be the dominant mobile device in the U.S., overtaking feature phones. At some point we may stop referring to these handheld computers as phones and come up with a more accurate name that conveys the multidimensional communications and connectivity they provide.
A generation ago, the thought of nearly every adult walking around with an always-on communications portal, replete with camera and location awareness, was science fiction at its best. The real-world impact of mobile can't be overestimated, nor is it likely that we've seen all there is to see in terms of capability for marketers. Mobile technology has spawned or repurposed a number of other technological advances as well, of which one of the fastest growing is QR codes. QR (for quick response) codes are an upgrade to the well-known barcode. They allow in excess of 7,000 characters to be embedded into the code itself. More importantly, they can be used to provide a connection to the web for those scanning them with a smartphone.
While these codes are ubiquitous in Asia, they're just starting to be discovered in the U.S. Awareness and use of QR codes is growing exponentially. Indeed, 32 percent of U.S. smartphone users have scanned a QR code and another 70 percent said they plan to use one again or for the first time, according to MGH's QR Code Usage and Interest Survey taken in February.
eMarketer reports usage of QR codes is up over 180 percent in the first quarter of 2011. For retailers, the question isn't whether to incorporate QR codes into their marketing strategy, it's how to do it.
QR Code Case Studies
Best Buy has led the way with QR code use, starting in the summer of 2010 when it began adding QR codes to its weekly circulars. From there, QR codes began appearing on product information labels in Best Buy stores, and a QR code reader was included in the company's mobile app. By scanning a QR code at the shelf edge, consumers are taken to Best Buy's website, where additional information such as product comparisons is available. This is all done within Best Buy's mobile app, allowing the retailer to control the communication and, most importantly, track what the consumer is looking at.
QR codes provide Best Buy greater insight into shopper behavior, with the ability to provide relevant offers on the fly that can be tracked in real time. As awareness of QR codes increases and consumers learn how to use them, the possibilities for all retailers will become more apparent.
Another retailer using QR codes is specialty cross-channel retailer Brookstone. The company launched a QR code program in 30 New York-area stores in April. Shoppers can scan QR codes located next to products. By scanning the QR codes, Brookstone shoppers can quickly access real-time customer reviews and product videos, and even shop a greater selection of similar products at Brookstone.com.
Brookstone reports that its customers are seeking information to make informed purchases. By offering QR codes in-store, Brookstone is complementing its knowledgeable staff and creating an online information experience in-store.
It's All About the Content
Whether QR codes will continue to grow in popularity will depend on two critical factors: the quality of the content to which the code leads, and its relevance to the consumer. QR codes are essentially hyperlinks, allowing a quick way to direct viewers to online content. They bring the online experience to which we've all become accustomed into our personal space. This means any ideas of using QR codes to deliver impersonal advertisements — or worse, coupons — should be abandoned posthaste. With the advent of new technology, we need to bury once and for all those old notions that really didn't work that well in the old world.
What QR codes enable is the ability to market to prospects in context. This is more than being able to offer a transactional percentage-off promotion. It's putting a connection from your product in front of consumers. Best Buy uses QR codes as virtual salespeople, allowing shoppers to learn about products without having to find a store employee who's knowledgeable about that product. But imagine offering an incentive along with the information (e.g., buy today and get 10 percent off) or even an accessory such as a free HDMI cable available for a limited time. This is possible because the QR code user is a discrete target who can receive customized communications based on behavior and location.
Mobile offers personalization down to the individual level. This is a critical difference from every other form of communication and should always be considered when developing mobile marketing strategies. Take advantage of this personal aspect as well as respect it because you'll only get one chance to lose a customer by not valuing their privacy.
3 QR Code Tips
To make the most of the opportunity that QR codes afford, retailers should keep the following basic ground rules firmly in mind:
- QR codes are essentially physical hyperlinks that lead to content; just as with online hyperlinks, these links should be relevant, timely and offer incremental value.
- QR codes aren't a magic bullet. They should be used as part of an overall strategy that incorporates mobile and ties all other customer touchpoints together.
- Users' privacy should always be held sacred; violate this rule at your own peril.
The growth of mobile as a marketing tool allows retailers to engage consumers in a manner that they could have only dreamed about 10 years ago. But with this ability comes the challenge of tossing out old paradigms and changing old habits. If you're looking for a way to cram QR codes into your existing strategy, it's time to stop, regroup and rethink that strategy.
Mobile is a game changer the likes of which we've rarely seen, akin to the internet or TV. It will change the way retailers approach marketing and how they connect with shoppers. As the technology matures and consumers become more comfortable with it, expectations from consumers will grow.