Will Mobile Marketing Drive Mobile Payments?

Smart phones are driving new capabilities for consumers and retailers, such as the ability to interact in real-time and space, keeping track of preferences. Multiple mobile marketing approaches range from barcodes, numbered coupons, text messages, sticker-based loyalty programs, to NFC-wallets. In its infancy, early results show much higher response rates than traditional marketing, such as paper coupons. Secure chip technology is expected to be the ultimate solution, optimizing usability, convenience, security and consumer opt-in.

It’s exciting to see examples of chip-based mobile marketing from around the world of the creativity being unleashed by the power of NFC to create incentives through speed, convenience and customer engagement, and to drive loyalty through discounts and privileges.

Loyalty programs have been the area of greatest activity, going back more than ten years. Several airlines, such as JAL, Air New Zealand and Air France, are using NFC phones to speed check-in and boarding.  Over the past two years, an explosion of tests of loyalty identification has emerged, many using the bridge technology of contactless stickers.  More sophisticated applications include ability to store multiple loyalty cards in Korea or to interact with games in Japan.

Smart posters and Coupons
Over the past two years, an up-surge of tests and experiments show how NFC and contactless-chip technology improves loyalty through coupons and interaction with smart posters.  These include several combinations of transit and fast-food restaurants in the U.S., Taiwan, Kuwait, and in Singapore where they tested the first real-time redemption of NFC coupons.  Some fast-food providers are beginning to reap the benefits of access to real-time analytics on coupon redemption, customer behavior and demographics.

Advertising and Offers
Mobile advertising typically uses the ubiquitous SMS message technique, but visionary applications of futuristic shopping environments show how smart posters and kiosks can deliver offers and specialized product information to NFC phones. This capability is being tested in concept stores and at trade shows.

The most sophisticated and futuristic techniques emerge with full merchandising and interactions with “smart shelves” and even “magic mirrors,” promising to transform the shopping experience of the future.

Consumers will be freed from paper and plastic, and will enjoy more personalization, convenience and control. Marketing and contactless payment should be tightly linked to drive consumer adoption. Mobile technologies, combined with security, opt-in services, and the technologies on mobile devices such as camera, accelerometer and global positioning, will unleash a flood of innovation. In the future we are likely to see increased use of instant promotions, cross-promotions, and more merchandising techniques to engage and excite shoppers.

For more information, see the Smart Card Alliance white paper on this topic. 
Deborah can be reached at Deborah.Baxley@capgemini.com.