Recognizing the benefits of mobile marketing to drive

innovation and growth

WebForward Conference 20112nd of June, Sydney

Nandor Locher, Manager E-Commerce

Discussion pointsRecognizing benefits of mobile marketing to drive innovation and growth

• Accepting mobile as a vital channel for brand positioning

• Utilizing mobile tools to interact with customers

• Recognizing the various options mobile offers to harness its potential

Mobile Marketing & Innovation• Key features of innovation: New, Fast, Useful, Accepted• Innovation changes the value system of people and the way they interact. The old system will change to make room for the better one.• Mobile Marketing takes shape in many forms. However, not all of these are innovations, but are an old concept in a new “dress”• Critical to focus on unique advantages on mobile devices to drive innovation• Despite the “mobile hype”, there is still plenty of room for innovation. It’s not too late to be early.

Vital Channel For Brand Positioning• Brand position is the aggregated consumer perception of a particular company and its products in relation to their competitors. • Companies with a high brand equity have high levels of awareness and strong, favorable and unique associations• The challenge for companies is to cut through the ambient "noise" and establishing a moment of real contact with the intended recipient• Innovative and useful mobile applications are becoming critical components in building and maintaining a company’s brand position and brand equity. • Equally important is the ongoing improvement and frequency of change. It is not good enough to simply have a mobile presence. • Mobile is particularly relevant for brand positing with both the corporate market as well as the younger demographic

Alignment with Strategy• Virgin brands worldwide stand for innovation, excellence in customer service and challenging the norm• Virgin Blue revolutionized the aviation industry in Australia back in 2000 and introduced an new low-cost distribution model through the internet• The current mobile web site & BlackBerry app were launched in early 2009• Virgin Blue recently launch the new brand Virgin Australia with a dynamic, stylish, vivacious and professional brand personality• A key pillar of Virgin Australia’s strategy is to become the airline of choice and target a bigger share of the corporate market• Mobile is an important component of this brand strategy

Mobile in the Travel Industry• Mobile enables completely new ways of engaging and interacting with customers and offers significant opportunities for innovation• Mobile is particularly important channel & tool for the travel industry, mainly due to its convenience, portability and accessibility• Mobile is relevant during all stages of the journey, including inspiration, planning, booking, whilst travelling, and post-travel. “Information on the go”• The competition in the aviation industry is intense and airlines are looking for means of differentiation other than price. • Airlines and online travel agencies have been quick in the adoption of mobile technology and the market has been flooded with an abundance of mobile applications and sites

Tool of Convenience• Main use of mobile is as a tool of convenience for the traveler. Consumers are looking for self-service applications that make planning, purchasing and travelling easier, faster, hassle free• Mobile is quickly becoming a hygiene factor in the travel industry. The lack of useful and innovative applications will drive existing guests to the competition.• Mobile applications are forming part of the end-to-end product of an airline. For example in case of flight disruptions, passengers increasingly expect airlines to provide solutions and updates via the mobile channel• Convenience offered by mobile channel is particularly important and expected by business travelers

m-Commerce and ROI• Mobile commerce is growing rapidly, but at this stage still equates to a small proportion of the overall revenue (< 3%)• Conversion rates for mobile channel are significantly lower than for website (around 4x lower). Many consumers use mobile for planning their trip however still use traditional channels (web / agency) to complete booking• Investment in mobile marketing & technology is largely an investment in brand and product. It will drive brand equity rather than pure sales. It is a mid/ long term investment • As a result, ROI assessments for mobile investments are not sufficient. It is necessary to consider other KPI’s.• Significant investment in mobile is required to keep up with competitors and market developments.

Opportunities For Mobile Marketing

Integration With Social Media• Mobile and social media in combination offer the perfect opportunity for new forms of engagement with the consumers

• Social media is intensively used in conjunction with travel• Sharing of experiences, reviews, recommendations• Instant feedback (complaints, compliments, disruption, incidents)• Location based status updates• Travel blogs

• Mobile and social media offer opportunity to engage with consumers during usual down-times, e.g. whilst in transit. Recent move of “Happy Hour” to the timeslot from 4-6pm and promotion via Facebook saw an increase of >50%

Mobile Web & Native Apps• Mobile applications and presence in top app stores is critical for brand positioning and consumer perception• Native apps often have much lower usage and live span than mobile web.• Due to multiple mobile operating platforms, native apps require higher investment for both initial build and ongoing maintenance. • Our mobile strategy is to get the best of both worlds

Thank You