Proximity Marketing: Bluetooth vs NFC (Contactless)

The Problem with Bluetooth

Bluetooth: named after the scandinavian king who united the country, it hasn't managed to do the same for mobile

Just a few years ago, Bluetooth was predicted as being the next big thing in mobile marketing. The DMA even produced a set of Best Practice Guidelines. Bluetooth offered a number of advantages:

  • It was network independent – you didn’t need a mobile data connection
  • You could send large files, quickly to mobile handsets
  • It worked on even the most basic mobile phones
  • The units were relatively cheap to install

However, it has never reached its promised potential. There have been few examples of major brands successfully using Bluetooth, and none recently. The failure of Bluetooth seems to be down to a number of problems:

  • Users don’t understand how it works – most people have no idea how to turn on or off their Bluetooth. Those that do tend to keep it off as it uses a lot of battery power
  • It doesn’t work on a number of handsets including iPhone and BlackBerry. Given that these two models represent half of smartphone users that is discounting a lot of people
  • It isn’t very reliable – the units often fail to pick up handsets or cannot deliver content

When it comes down to it, Bluetooth was never intended as a marketing medium. It was intended to connect to other devices or for peer to peer file sharing. As such there has been little investment in the channel or the technology.

NFC, The Future of Mobile?

With rumours of contactless payments in iPhone5, 2011 may be the year of NFC

Near Field Communications, or Contactless is a contender for the next big thing in mobile. Unlike Bluetooth there has been a considerable investment in the technology by banks, mobile handset manufacturers and the mobile operators. Visa, for example has committed 400 million Euros to rolling out NFC this year. Payments and ticketing are the main driver, however the potential of NFC marketing is also a factor in its development. So far, only BlackBerry have announced a handset, but other manufacturers will follow. Rumour is that Apple will include it in the iPhone 5, assuming they can get the technology ready.

The key benefits of NFC are:

Simple to use – you just ‘touch in’ to make a payment, get your voucher or call back
The infrastructure already exists in the form of payment terminals in numerous retail outlets
Clear user permission – the action of touching in means that mobile handset users have specifically given their permission

So, it looks like NFC has a future (unlike Bluetooth). It is estimated that it will  be available in all handsets within the next 12 months. That just leaves one major hurdle, consumer adoption. Will mobile users trust it enough to actually use it?

Taking it personally – the problem with mobile marketing

Marketing to mobile can generate some good responses. With the current economic situation, mobile offers new opportunities to reach customers and reduced marketing costs. The results from mobile marketing can also be very effective, with response rates over 8% being generally measured.

However, anyone looking to run a mobile campaign needs to seriously address the way it is run, who they are contacting and the offer is.

Mobile phones are devices that most of us have with us most of the time. There is a strong sense of identity attached to our mobiles – the type of handset (‘I have an iphone’ etc), wallpaper or ringtone is as much a part of our identity as the clothes we wear. What’s more, it’s the device that we contact our family, friends and loved ones on.

Whatever the marketing campaign, be it SMS, mobile sites or Bluetooth proximity marketing, sensitivity to the mobile user is paramount. Imagine if you are waiting for an SMS from your partner and a marketing text arrives on your phone? It’s going to annoy the user and put the brand in a very poor light.

A recent discussion amongst technological savvy mobile users about mobile marketing generated many responses like these:

‘Its like the people in the street who try to thrust leaflets on us, except its just about possible to dodge them.’

‘I have received two text messages from businesses I was walking past, both offering immediate discounts. I can think of no other way to more effectively ensure that I will never do business with either establishment again.’

‘If anyone sent a message to my cellphone or other device just because I walked past their store, billboard, advertising poster, etc., they would lose my business forever.’

It is unlikely that a billboard, direct mail or TV ad could cause as much offence, purely from attempting to contact potential customers.

You may think therefore, that mobile marketing is likely to upset customers too much or it is too fraught with problems to run a campaign. However, the highly personal feelings about mobile can be used to great effectiveness. There are many examples of mobile marketing campaigns that have generated an excellent response.

The key is to ensure that it is permission based, highly targeted and offers a real benefit to the customer or potential customers.

Gaining permission often requires more than a simple ‘soft opt in’. It is important and beneficial to get a clear consent from a customer to send them marketing information to their phone. That consent should also be recent. If they opted in 12 months ago then you would need to get their permission again.

Well targeted campaigns means sending the right type of content on the right day at the right time.

The benefit comes from giving your users a clear offer – discounts, free products or mobile content are all examples of offers that work well.

So, mobile marketing has it’s benefits, but working with experienced professionals to deliver campaigns can ensure that you are effective in what you do.