Mobile phones alert shoppers about local sales

By Hope Needles


Online shopping may be one of the easiest and most efficient methods for tracking down rare-to-find items and bargain merchandise. But now, with retail sales fluctuating, it is becoming even easier to find attractive discount offers in stores. As more and more retailers slash prices and offer in-store money offers to boost sales, a window of opportunity continues to open up for GPS-targeted mobile advertising.


GPS-targeted mobile advertising allows customers to receive discount offers or text messages that are triggered by their online personal data and, in some cases, their mobile GPS locations. Privacy issues aside, these customized ads seem like an ideal way for reaching people on long commutes, at work, or out running errands.


An increasing number of members-only Web sites, for example, have started offering mobile discount alerts to consumers. Luxury flash-sale sites Gilt.com, Hautelook.com and Ideeli.com send out multiple text message alerts to customers throughout the day, all linking to sale merchandise. CBS is also taking a large step in this direction, utilizing loopt, a GPS social-tagging service, to deliver ads relevant to your current location. These will appear on CBS Mobile News and CBS Mobile Sports.


Although the full potential of mobile advertising may still be a little way off, mainly because of the restricted audience size, I believe it is becoming one of the most powerful ways of reaching consumers. Worldwide, mobile advertising is projected to surpass $2.7 billion in 2008, up from $1.7 billion in 2007, according to Gartner.


Overall, mobile sales alerts have the potential to more directly influence a consumer’s purchasing decisions than an ad that is read in a newspaper, or received via a PC. The fact that the consumer may already be out of the house when they receive the alert, and likely within closer distance of the store or company where the sale is being offered, may lead to a more positive and immediate response from consumers.


Another powerful feature built into SMS mobile sales alerts is word-of-mouth promotion. People are likely to be in social situations throughout the day, when mobile advertisers send out discount offers. In workplace environments, or while out to lunch with friends, it is natural to want to share the news of a good sale. Let’s say, for example, a group of four women meet up for a coffee one morning. Over a conversation about sports, one of the women receives an SMS alert for discounted Nike running shoes, sold at a store nearby. This women shares the text message with the rest of the group, thereby generating free publicity for the offer. After coffee, all of the women then decide to check out the sale, and a few of them make purchases. In this example, a single mobile text alert was be able to reach several people in a target demographic for that product, at the cost of supplying just one ad.


Mobile video ads, another powerful tool for delivering content, may also continue to catch on with consumers, thanks to current efforts by the wireless industry to bring the mobile Internet experience up to par with the PC experience.


Several handset makers signed an agreement last week with Adobe Systems Inc. to better integrate Flash players on mobile devices. Currently, Flash is used on approximately 30 percent of cellphones, but this is projected to increase as partnerships grow with Sony Ericsson, Nokia Corp., LG Electronics Inc., and Motorola Inc. The extended use of Flash on mobile phones will make it easier for online video advertisements to penetrate not only SMS alerts, but also mobile Internet searches.


As consumers grow increasingly receptive to mobile sales alerts, it will be very interesting to see if mobile Internet shopping will be able to take off, and fully compete with the PC experience in the next year or so.