Next Time Your Cell Rings, It Could Save You a Buck

As Redemption Rates Jump, Major Marketers, Retailers Try Mobile Couponing

SAN FRANCISCO (AdAge.com) -- You've heard the example before: You're walking past a Starbucks on a steamy afternoon when a $1-off coupon for the retailer's iced Frappuccino hits your cellphone. But after years of being a hypothetical, mobile place-based couponing is here.
Mobile suppliers said Target, Best Buy and other mass marketers are likely to use cellphone-targeted coupons in for the 2006 holiday season.

Many consider couponing via cellphone the ultimate scenario for tapping into the estimated $15 billion retail-promotion market. And in the next few weeks, a number of major marketers and retailers -- including Hollywood Video, 1-800-Flowers.com, TGI Friday's and Bath & Body Works -- will try it for the first time.

"Mobile couponing has arrived," said Brent Dusing, CEO of Moonstorm, a mobile-marketing-solution provider.

Downloading a coupon wallet Mr. Dusing said the marketers are using Moonstone's Cellfire program, in which a consumer downloads a virtual coupon "wallet" to a mobile phone and shows the phone with the coupon code to a store clerk. The coupons may be worth a free movie rental or $5 off dinner and are being promoted through shelf-talkers, click-to-call offers on web pages and through other advertising offers.

Mobile suppliers said Target, Best Buy and other mass marketers are likely to jump in for the 2006 holiday season.

Mr. Dusing said Cellfire's coupon redemption rates are in the "mid-teens to 23%" and others in the mobile-marketing space report similarly high conversion rates. Nihal Mehta, founder of Ipsh, now part of Omnicom Group, said a mobile-coupon promotion involving Capitol Records artist Chingy and retailer Sam Goody resulted in a 10% redemption rate -- more than 10 times the industry average for paper coupons.

In 2005, 278 billion conventional coupons were distributed and only 3 billion of them were redeemed, according to coupon clearing agent Valassis' NCH Marketing Services unit. The value of those redeemed coupons was less than $3 billion, and that total has been dropping by about 5% per year, said Charles Brown, VP-marketing at NCH.

That's in part because consumers balk at higher-value coupons that require them to purchase multiple products and may not, all things considered, provide the best value to the consumer. Last year the average coupon face value was $1.09, while the average redemption is 83 cents, he said. Retailers training sales force A number of the nation's top retailers are training their sales forces to work with the new cellphone-based coupons, Ipsh's Mr. Mehta said. Pharmaceutical marketers are also beginning to look at the mobile phone as a vehicle for discounts, loyalty marketing programs and free-trial offers.

The ability to deliver coupons at the right moment -- just as someone's nearing a particular retailer or restaurant -- is key and requires a marketer to detect the location of a person's phone at any given time. Some 200 million Americans have mobile phones with locating devices; Sprint, for one, has a searchable local directory that can recommend nearby restaurants, clubs or bars, and almost all Verizon Wireless phones soon will have similar capabilities.

But as that technology emerges, so do privacy concerns. Beth Givens, director of Privacy Rights Clearinghouse, a nonprofit consumer-advocacy group in San Diego, said mobile coupons must be something the individual opts into. For marketers, it would be a "terrible mistake to transmit location-targeted advertising to someone who has not consented" to receiving the message. She said her phone has the ability to turn off functions that reveal her location.

Privacy invasion Jay Stanley, public education director, technology, for the American Civil Liberties Union, said cellphone location data is a "honey pot for privacy invasion" and new laws are needed to make sure information gathered for one reason is not used for another. He said mobile phone location information for emergency 911 purposes, for example, should not be not used for marketing. "Our technology is 2006 and our laws are 1936," he said.

Other obstacles exist, especially the need to train sales forces; a perhaps bigger expense would include purchasing new point-of-sale registers and equipment.

Mr. Mehta, however, said mobile coupons are a "killer application. The reason it hasn't taken off is that brands don't know how to capitalize on it. It's just a matter of time."

Not all mobile-marketing experts agree coupons are the holy grail of mobile marketing, especially right now. For one thing, the coupon offered "better be pretty valuable or it's going to be perceived as spam," said David LaPlante, CEO of Twelve Horses, a relationship-marketing and messaging-management company. "As soon as people complain, it's bad news for everyone."

And as for the oft-repeated Starbucks example? Well, said Mark Donovan, VP-senior analyst at M:Metrics, "if you've noticed, coupons are not part of Starbucks' brand strategy." At least not yet.

Marketers not sure if dot-mobi domain clicks

What’s in a name? That’s what the mobile marketing community has been addressing ever since Microsoft, Google, Nokia and a host of other brands joined forces to bet more than a million dollars on the name “mobi.”

But while marketers, the mobile industry and anyone else standing to benefit from the expansion of mobile web are backing dot-mobi—a mobile-specific domain address similar to dot-com that allows people to surf the internet via cellphones, smart phones and other mobile devices—others think the well-ingrained dot-com address works just fine, and keeping it will mean not having to spend money educating consumers about what the heck dot-mobi is in the first place.

“I don’t think it’s strategic in the long term,” said Jean Berberich, head of mobile consumer strategies for Procter & Gamble Co. With dot-mobi, marketers would likely need to add text to their ad copy that instructs consumers to use dot-com for PC and dot-mobi for mobile surfing.

Source: Adage.com

Google targets mobile future

If you use Google, the chances are that you search its index via the internet.
But the company's ambitions do not begin and end with its online presence. For some time now, it has been establishing ways for people to use its roster of services via mobile devices.
Mobiles are part of everyday lifeIf you use Google, the chances are that you search its index via the internet.
But the company's ambitions do not begin and end with its online presence. For some time now, it has been establishing ways for people to use its roster of services via mobile devices.

The man in charge of the Google mobile mission is Dipchand "Deep" Nishar. He believes that when people are out and about, they want very different answers from Google than they would if they were sat in front of a PC.
For instance, he said, the first result that comes up after typing "film" into a PC browser is the Internet Movie Database. "But type 'films' into a mobile browser and you are most likely going to see a movie," he told the BBC News website.

Handy helper
"The same search query, because of the context, means very different search results," said Mr Nishar. "Search on mobiles is about finding not browsing. "It's a smaller form factor and you are not going to sit at it for three hours. Most people in the developed world are within 20 or 30 minutes of broadband and a screen, and that's when they will browse. "On a mobile it's important that you find it right away." This means that Google has to slice its huge corpus of data differently for mobile users and tailor results to where people are sitting or standing when they make the query.

What is also important to realise about mobile devices, said Mr Nishar, is that they are far more personal than a home computer.

"A PC is much more of a shared device," he said. "But a mobile is not something I share with anyone." So far the bits of Google you can reach via your mobile are fairly limited.
You can use a browser on your phone to send queries to the search site as you would on a PC. You can also search for images or just search those sites created just for mobile phones.
It is also possible to read your GMail account via a mobile and, in the UK, you can search Google via text messages. In California it is possible to get Google maps on your handset to help if you are looking for a particular place. Using many of these services requires a web browser on a phone but, said Mr Nishar, only about 50% of the world's phones are powerful enough to run that software.

Culture shock Google does not make all its mobile services available in all locations because different cultures make very different uses of their phone. For instance, said Mr Nishar, text messaging is huge in Europe and China. By contrast, almost no-one in Japan uses it. But the Japanese do make very heavy use of e-mail on mobile devices. They also do a huge amount of net surfing via handsets.

In many nations outside the West phones are also hugely important ways of going online largely because they are so much cheaper than a desktop computer. In China, said Mr Nishar, there are three times as many mobiles as PCs. In nations like Nigeria, people prefer mobiles because power supply problems in running a computer. "There are many emerging markets where people do not have a PC and will never have one," he said.

Add in the moves towards using net phone services via wi-fi and you can understand why Google is dedicating a lot of time and resources to mobile developments. Eventually, the thinking goes, most people will be accessing Google most of the time via a mobile device. "It's going to get better, faster, cheaper thanks to Moore's Law and become a better experience in the long run," said Mr Nishar. "It's going to be a very important channel."

Source: BBC News

Ad Clients Mixed on Integrated EffortsJohn Consoli

A new Association of National Advertisers survey finds that 67 percent of advertisers develop integrated marketing programs across most or all of their brands, but only 33 percent say they are "very happy" with their efforts and results. The survey also found that trends thought to be hot, like videogame advertising and mobile marketing, were viewed as being least significant to the marketing mix.Another finding, which shows that advertisers are frustrated with marketing efforts in general, only 30 percent said general advertising adds the most value to a company's marketing communications programs, down from 51 percent in 2003.A majority of advertisers, 63 percent, also say that organizational issues are the greatest challenge to successfully integrating their marketing efforts, specifically identifying the existence of "functional silos" inside their companies as a key challenge.The survey was conducted in collaboration with Blueprint Communications and the results were released today at ANA's first annual Masters of Integrated Marketing Conference in New York City.

Mobile to Score at World Cup. Will mobile broadcasting be shown the red card?
Will mobile VoIP score early and often?

FIFA World Cup may be one of the most popular sporting extravaganzas in the world, but when the tournament finally kicks off Friday, it will be little more than mobile technology’s opening act before the main event in Beijing in 2008.

Mobile broadcast technology is truly not ready for a unique, live event such as the World Cup, but it will provide a proving ground of sorts for what will be the real coming-of-age of mobile broadcast technology at the Olympics, two years from now.

As a large percentage of the cell-phone-wielding attendees at the World Cup in Germany will be from non-European countries such as Brazil, Saudi Arabia, and the United States, the World Cup may also be the coming-out party for mobile VoIP services.

“Using the FIFA World Cup as a hook for mobile TV services makes sense,” said Eden Zoller, principal analyst with Ovum. “It’s a hugely popular event around the world that has the potential to engage a mass market.”

But there is a major caveat.

“People will approach it with high expectations and a great deal of passion so operators must get it right,” she said. “This is critical for new DVB-H [digital video broadcasting – handheld] broadcast networks, but also for 3G, which will have to cope with massive peaks.”

But service providers run a major risk, Ms. Zoller added, because poor service could tarnish the world’s impression of mobile TV.

Expensive International Calls
Expensive international calls could also sour attendees on mobile voice service and perhaps open the door for mobile VoIP services providers such as MiMO, RebTel, and Jajah (see Why Mobile Carriers Avoid VoIP).

According to a report from Informa Telecoms & Media (ITM), the expected 1 million World Cup attendees will spend $46 million on mobile calls and text and video messages over the course of the monthlong event (see Jajah Dials Cell Phones).

ITM estimates that each person will generate an average of $46 in roaming charges, which would not be too bad for European attendees.

“Recent price cuts announced by operators such as Orange and Vodafone are going to benefit fans of teams inside the European Union, but it’s worth remembering that 21 of the teams in the tournament are from non-European countries,” said ITM’s chief research officer, Mark Newman.

“Many may opt for purchasing local SIM [subscriber identity module] cards or other alternative roaming solutions, as advocated by tourist boards and some mobile operators,” said Mr. Newman.

Brazilians, Mexicans, and Costa Ricans will be paying as much as €3.50 per minute ($4.43) to call home from Germany.

According to the ITM report, a typical roamer will send eight text messages, make 10 voice calls, generate a single data session, possibly to send an MMS (multimedia messaging service) message, and receive six calls during their visit.

What about VoIP?
Faced with high interconnection charges and a rapidly maturing market, mobile service operators have kept international calling rates outrageously high. In most countries, callers have steered clear of making international calls on their cell phones (see VoIP Upstart Makes Mobile Call).

But VoIP service providers are rapidly jumping in to exploit that market opportunity. Companies such as MiMO and RebTel have introduced technology that allows mobile callers to spoof the network or use their standard data services to make international voice calls for as little as $0.02 per minute (see Serving Ethnic Mobile Talk).

VoIP callers could be the biggest mobile winners at FIFA World Cup.

Source: Red Herring.com