As Mobile Payment War Grows, Men’s Wearhouse Reveals Big Marketing Stats

Expects mobile to increase 2015 revenue by seven figures

At the same time Google and Samsung are scooping up startups to build out a mobile payment system that competes with Apple, new data from retailers reveals some initial success with smartphone-powered marketing campaigns.

Today, Men's Wearhouse and the mobile marketing firm Vibes are releasing sales numbers from mobile campaigns dating back to 2013, shortly after Apple and Google launched mobile wallets—apps that store coupons and offers.

The clothing retailer initially began using Apple's Passbook and Google Wallet a couple years ago, allowing customers to download coupons from email campaigns. By 2014, 55 of the retailer's promotional emails included a "save to wallet" button so offers could be stored on a smartphone.

Those mobile offers outperform traditional email coupon redemptions by 10 times, per Matt Stringer, evp of marketing at Men's Wearhouse.

Based on that stat, the retailer then began plugging mobile coupons into its Perfect Fit loyalty app. The app also links with Passbook so offers and loyalty points pop up on a smartphone's screen when someone is near a store.

In December, Men's Wearhouse also ran a campaign using a mobile game that was promoted with mobile ads, Twitter posts, email blasts and a call to action on the retailer's website. The game asked consumers to swipe their fingers across a smartphone screen to unlock an offer, which could then be saved to either Passbook or Google Wallet.

According to Stringer, the game drove a 166 percent increase in coupon redemptions compared to nonmobile tactics. The campaign also increased average order value by 35 percent.

Stringer admitted the overall uptick has been slow with mobile, but the company hopes its plan to take its entire loyalty program mobile will boost adoption.

"The next step for us is starting to mobilize the loyalty cards into Passbook and Google Wallet itself, with the idea of letting the consumer ditch the old-school plastic card to deliver real-time offers," Stringer said. "We're not there yet, but that's definitely where we're headed."

As a result of the holiday promo, Men's Wearhouse expects mobile wallets to drive a seven-figure increase in 2015 revenue, based on last year's campaigns.

Still, some are skeptical that mobile wallets can drive that kind of revenue.

"Consumers are still confused about how and why to use Apple Passbook and Google Wallet," said Sheryl Kingstone, research director at 451 Research. "My opinion is that it is still in its infancy."

Still a Long Way to Go

Meanwhile, the mobile payment war between Apple and Google continues to heat up this week.

Yesterday, Google announced its AT&T, Verizon Wireless and T-Mobile Android phones will come preinstalled with the Google Wallet app.

The Mountain View, Calif.-based company has also acquired part of the technology that powers Softcard—a mobile payment company that lets customers pay with their phones in stores like McDonald's and Walgreens.

Google has aggressively been chasing Apple since Apple Pay launched last year, which was backed by a long list of marketers.

Samsung also beefed up its mobile payment potential last week with the acquisition of LoopPay, a startup that is expected to build mobile payments into the upcoming Galaxy phone.

According to eMarketer, mobile payments were a $3.5 billion business in the U.S. last year. By 2016 that number will jump significantly to $27.5 billion and contribute more than $118 billion in revenue by 2018.

In a statement, eMarketer analyst Bryan Yeager said the Google news will help the company reach a wider audience, but there's still room for competition. 

"The mobile payments space in the U.S. will continue to be competitive and fragmented for at least the next few years as various stakeholders vie to get traction with consumers," Yeager said. "This is an important step for Google Wallet, but it won't be the only mobile wallet option Android users will have."

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