[cross-posted on the Mobile Ads Blog]

Welcome to the latest post in our Mobile Insights series featuring expert views from our mobile ads team. This week’s guest contributors are Alex Barza and Kacy Brod, who lead our U.S. mobile efforts for Retail. Here are their thoughts on the state of mobile marketing in retail gleaned from Think Retail 2011, Google’s annual gathering of retail executives.

At this year’s Think Retail event in Mountain View, mobile marketing was a hot topic.

We started the day by summarizing the most interesting retail insights from a recently conducted 5,000 person mobile survey (watch the three minute highlight video). We also noted that last year our #1 recommendation to retailers was to create mobile-optimized sites and/or apps. After a quick survey of Internet Retailer’s top 100 ranked companies, we’re happy to report the majority now have created one or both.

After speaking with many retailers and analyzing our own retail data, we identified six trends and recommendations around each to help retailers evolve their mobile strategies.

#1 -- Mobile Is Highly Engaging: There’s no other platform that can allow you to touch and engage with a product or brand like mobile can, so intrigue users to interact with your advertising campaign. Invite them to swipe, rotate, tell their own story, or upload their own personal video: the sky’s the limit. The Gilt Groupe, for instance, ran a iPad Rich Media Interstitial ad that lets users interact with multiple product images by swiping and enlarging the images in an interactive manner. Users simply tap or pinch-out and, in this case, have the option to download the app directly from the Apple Marketplace.

Recommendation: Tie mobile into other branding and channel marketing strategies and look at tapping into Mobile's unique native features to further engage customers.

#2 -- Local Drives Business: We’ve said it before, and we’ll say it again: we believe in local search. The most popular mobile shopping activity is locating the nearest retailer. When consumers find local information, 88% take action within a day; of this number, 61% call a retailer and 59% visit a store. (1)

Recommendation: Be discoverable and drive store foot traffic when consumers are searching for your business, products, or services. Integrate store locatiors into your display campaigns to help your customers find stores nearest to them.

#3 -- Consumers Want Offers: Google research shows that 70% of consumers use their smartphones while shopping. Why? Consumers love to compare prices while in a store. When we analyzed last year’s holiday search trends, we found a 250% increase over the previous year in searches related to offers and deals.

Recommendation: Use Ads with Offers and mobile coupons in both search and display to drive consumers into your stores and keep them there while they are comparison shopping. Include mobile to distribute promotional offers and time-sensitive coupons and designate custom mobile codes to track the return on your ad spend.

Both display and search ads deliver returns for retailers

#4 -- Consumers Engage with Mobile on Multiple Platforms: More than 165 million tablets are expected to ship in the next two years, and according to eMarketer, 41% of people say shopping is their sole purpose for buying a tablet. As a result we’ve noticed a big surge in search on tablets which has prompted us to completely redesign and optimize the tablet search results page for a touch interface. This means retailers need to have a cross-platform strategy which includes tablets.

Recommendation: Test new ad formats and redesign experiences specifically for different types of devices. Target tablets within your existing desktop search campaigns or break them out to ensure appropriate coverage, especially during this holiday season. Reach the tablet customer via new rich media ad templates that make it easy to execute a rich user experience resulting in extremely high engagement. These templates take advantage of tablets’ larger screen sizes, high-res graphics, touch screens and multimedia capabilities to drive deep engagement with mobile audiences. Take a look at our launch partner video here!

#5 -- Mobile Is Incremental: Fifteen percent of all shopping-related searches are now on a mobile device. This spells opportunity for retailers to tap into search growth by specifically targeting mobile devices and tablets.

When one advertising agency expanded their client’s business onto mobile, they saw some unexpected but very interesting behaviors. 20% of clients who conducted research on the desktop finalized their purchases on mobile devices. Seeing this incredible crossover data, they invested in mobile search advertising by leveraging Google’s Click-to-call ads to drive traffic to their call centers and also sent mobile users to an easy to use two-step ordering process on mobile and tablet sites. This investment led to a large increase of new prospects and also lowered the cost of a sale by 25% when occurring on mobile versus the call center. This is just one example of what can be achieved.

Recommendation: We see huge search spikes during the holiday season, as the above shopping query trend graph illustrates. In fact, last year Google saw a 250% increase on Black Friday related queries vs 2009 during the week of Black Friday and we’re hoping for another banner year for mobile. This is a valuable time to get in front of consumers, so have specific mobile holiday strategies in place and establish appropriate budgets. Below are two examples of how Target and Home Depot used Black Friday messaging during the week of Black Friday to capture the increased demand.

#6 -- A Word On Measurement: Mobile acts as a bridge and impacts your in-store and online channels. The opportunity is huge, but it requires innovative thinking, adapting to new realities, and challenging the assumed models. Our research shows that when consumers make purchases as a result of research conducted on their phones, 76% purchase in-store and 59% purchase online, while a smaller portion purchase on their phones.

Recommendation: Measure mobile differently; don’t measure success solely on mobile sales broadly. Think of conversions differently -- metrics such as a store look-up, customer sign-up, redemption of an offer in store, or app downloads are important. Tablets, on the other hand, have shown very strong eCommerce ROI, especially in retail, and can be measured more like desktop.

To learn more about the above recommendations, download the Full Think Retail Mobile Deck here.

For a quick snapshot of what’s available for retail in mobile now, check out our retail sizzle video.

Posted by: Alex Barza, Senior Account Executive, Mobile & Kacy Brod, Mobile Head of Display, Retail

Additional Notes (1) Google & OTX Study Q4 2010