Will Mobile Marketing Drive Mobile Payments?

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

Consumers will be freed from paper and plastic, and will enjoy more personalization, convenience and control. Encryption and Secure Element protects the contents of a mobile wallet as securely as payments, so that coupons can’t be duplicated or counterfeited.

Mobile marketing faces the same set of “chicken and egg” issues that mobile payments do: the number of new ecosystem players. Merchants, consumer brands, aggregators, application providers, TSMs, and MNOs must all collaborate to provide value to consumers. Standards for interoperability are not as mature as payments standards. Marketing and contactless payment should be tightly linked to drive consumer adoption. Mobile technologies, combined with security, opt-in services, and all 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.

The Smart Card Alliance is published a white paper on this subject “Chip-Enabled Mobile Marketing,” due out in early August. Keep checking http://www.smartcardalliance.org/pages/activities-councils-contactless-payments for its availability.