Wednesday, February 4, 2009

Voice-Enabled Gift Cards?

Gift cards - we all get 'em and love 'em. Gift cards have sure taken the stress out of finding the perfect gift for Aunt Edna. They have also taken the stress out of receiving the perfect gift from Aunt Edna. "Gee, thanks for the coffee mug with matching sweater!" Can you ever imagine the day that gift cards will have the technology that enables you use them as a phone to call your Aunt Edna and thank her personally? Sound far-fetched? Perhaps. But let's turn it around a bit. Can you imagine the day that your mobile phone can be used as a gift card to make in-store purchases? Imagine no more. It's real and it's already being tested around the world. But what does this have to do with email? Lots - about $36 billion dollars' worth.

Thanks to the technology called Near Field Communication (NFC), financial transactions such as mobile couponing and gift card redemption can be done simply by touching your mobile phone to an NFC-enabled point of sale device and providing some type of security input. Simply put, NFC is one of the many varieties of "contactless technologies" being explored today. NFC is designed to operate over very short distances, typically less than 4cm, and is being seriously looked at in the world of mobile commerce - mainly because customers worldwide have confirmed that the mobile phone is the preferred form factor for contactless services.

Research firm Strategy Analytics estimates that mobile commerce conducted via NFC will facilitate over $36 billion of worldwide consumer spending by 2011. Nineteen of the world's largest mobile network operators (MNOs) have been working together in a Global System for Mobile (GSM) Association initiative to create and define a global approach to enable NFC services on mobile phones. Together, these nineteen MNOs represent about 45% of the worldwide GSM market, which addresses over 800 million customers.

So what does mobile NFC have to do with email? The fact that more and more consumers worldwide are reaching for their mobile phones for data services (including email) is already yesterday's news. Some consumers, in fact, are starting to use their mobile phones as their only means of viewing their emails. Emails viewed on mobile phones will be around for a long time. SMS messaging is very expensive for the marketer to do thanks to the market-killing practices of mobile carriers in the US.

Opt-in email marketing is the most cost effective channel today and will continue to be so tomorrow. Coupon promotions are well known to drive sales. But email is a digital medium hence coupon redemption is restricted to either digital transactions (e.g. a coupon code entered at time of purchase on an e-commerce web site) or it must be transformed into something physical (e.g. printing an email with the coupon to be redeemed at an outlet). New entrants to mobile marketing are experimenting with barcode images embedded within emails that are scanned by the point of sale reader. The details of this capability are still being worked out.

Mobile NFC will extend the power of email marketing to new heights. Brands - especially those having physical outlets - can extend all kinds of incentives and rewords to their customers. In the not-too-distant future, when you're reading your emails on your mobile phone, you'll see one from your favorite brand with a special offer to you. You click on the link where you go to a mobile site which will download the coupon or gift card which is now stored on your phone's SIM card. You go to the store, try on the size, style and color of the outfit you want, wave your mobile phone over the point of sale NFC reader and the coupon/gift card amount is automatically applied to your purchase. Security? Not a problem. Provide your thumbprint on your mobile phone's screen to verify the transaction and away you go.

Mobile NFC is still a tad in the future - at least here in the US. But don't wait! If you are a mobile marketer, start thinking now of how you can reach your customers with email campaigns tailor-made for your customers' increasingly mobile lifestyle.

Have you ever used your mobile phone to make a payment? How would you rate your experience? Leave me a comment!

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