No sooner than my post about location about to become interesting for consumers, Techcrunch posted an article about a concept by AT&T for ‘on-the-go’ mobile coupons.

Ever since the dawn of time mobile marketers have been using the ‘Starbucks coupon’ example to sell the idea of location based coupons into brands and businesses. I’ve used it a few times because it’s the easiest way to explain to someone who’s ‘non-mobile’ about location and the possibilities.

The scenario goes like this, you sign up for a mobile coupon service, fill out your profile, ticking coffee and various other things as your interests. You walk past Starbucks one day and BAM, your mobile beeps and it’s a 20% discount SMS coupon for a cup of coffee. Then you stroll in, extremely happy and redeem your coupon. Win for you and a win for Starbucks.

This basically applies to the concept by operator AT&T, the idea is simple, as consumers walk around a city, they get mobile alerts whenever their favourite nearby stores and restaurants have a deal. It works by the mobile operator constantly monitoring the customers location (opt-in of course), then matching that info to available retailers to push coupons/info.

Sounds great, apart from one problem….it uses SMS.

Firstly you will never escape the fact that SMS advertising messages are intrusive. They arrive into your inbox just like personal messages, they don’t have a separate folder, they don’t arrive silently, they don’t generate a different on-screen alert or icon. Oh and if it’s a coupon, you can’t sort by expiry date.

intrustive_sms_ads_coupons

Just like any consumer, I’m interested in around 100+ different brands, everything from clothing, electronics, all the way to peanut butter. Do I want discounts on these brands? Hell yes (I love those printed vouchers), gimme as much as possible. Do I want my phone beeping several times a day and my inbox filling up? Hell no.

No matter how targeted the coupon is, there is no way a location based SMS service can remain useful and scale to cover the amount of brands an average consumer likes without severely pissing them off, regardless of opting-in.

Often you’ll hear the answer “Well you can just set how many offers you want per day so you’re not inundated”, however it’s not the amount of offers that’s the problem ‘cos I want them all, it’s the way it’s delivered to the phone. SMS just isn’t the right technology to handle it. Anyway, no matter how über targeted that advert, it needs to find a way through a number of real life obstacles first.

Pushing adverts and coupons to people based on their location has so many variables involved to get a positive reaction. One of the 1000+ things to consider are – when did they last get paid? Are they in a hurry? Are they waiting for someone they met on Saturday night to text them back? All of these things will have a influence on the person receiving that coupon to a) not be pissed off and b) actually use it.

It’s clear that SMS ads can’t scale for the consumer but what about the advertiser? The costs for SMS and location lookups aren’t cheap. So how do you get small/medium sized businesses involved? Do you really want to keep getting offers from McDonald’s, Coca-Cola and Nike all the time?

The consumer research I’ve done has made it clear that it’s not only variety of businesses and brands that’s important but the type of communication too. People don’t just want to be told about discounts in an effort to constantly part them with their money, it’s about things like free gigs, days out, local events and all that other stuff.

Research I was involved in at Nokia showed that even in emerging markets where people are more receptive to ads, SMS push advertising can still annoy the hell out of people.

The solution?

Looking towards the future, mobile coupons need seamless integration into the phone operating system. Especially with technologies like NFC coming into the mix. No downloads and no crap, just comes as standard like your SMS inbox. Pushing adverts is still the right solution because location based ‘pull’ is unrealistic.

What if you had another inbox for coupons that used your data connection? Always running in the background, it’s own entity on your phone, and constantly updated with proper coupon management.

When a coupon comes in you get a notification on your homescreen which contains the companies logo and offer info, then fades after a few seconds and then goes into your coupon wallet. You can sort coupons by expiry date and distance as well as get alerts if one is about to expire. You’ll even be able to control the way alerts sound and act.

If you take Tweetdeck on the PC/Mac as a example. The way it deals with large amounts of constantly updated information could provide some great learning’s for how coupon wallets should work for the average person who walks past dozens of shops every day.

Large detailed notifications provide enough information at a glance for you to decide to find out more info, it’s unobtrusive and has enough options to customise alerts so it doesn’t annoy you.

Here is a Tweetdeck notification:

tweetdeck_notifications

Using this, I’ve come up with a coupon notification on the mobile phones homescreen:

coupon_phone_LBS

Now lets look at how the Coupon Wallet might look:

mobile_coupon_wallet

coupon_sort

The benefits over SMS are clear, a real solution for mobile coupons rather than a hack of a existing messaging technology.

The only company I can see delivering something like this is Google. Not only do they have a great mobile operating system which more and more handsets are adding everyday, but also the ad serving technology to easily enable small, medium and large businesses into location advertising. They mastered it with search advertising and they’ll do it with location too.

Google Local Business Center logoIt’s not just about premium brands, it’s about huge inventory made up of small and medium sized businesses, allowing thousands of locations to push ads to users. Big brands are great if you live in a major city but there many high streets and towns that aren’t oozing with well known names. Just take a look at Google Local Business Centre, it’s so damn easy for a independent store to get involved in location and coupons, that’s how it needs to be.

google maps coupons

Google have already started integrating coupons with maps, it’s very early days but businesses can use printed or mobile coupons with their company map placement. The way it works at the moment is by you actively searching for businesses in maps and if they have a coupon your in luck. But what if your in a area you already know? How will you find out coupon offers in your area? That’s where the Coupon Wallet idea comes in.

I’m eagerly waiting to see how this pans out, third parties like Cellfire will always have their applications but once it becomes a out-of-the-box mobile feature they’ll be in trouble. Whether it’s integrated with Mapping applications or stand-alone, it’s definitely coming.