Frank Maresca thinks that mobile marketing is a great idea whose time isn't quite here.
Maresca, who owns two Moe's Southwest Grill locations in the Washington, D.C., area, ran a mobile marketing trial earlier this year.
"We were presented with the idea, and it was appealing because it seemed that it was going to target a younger demographic for us," Maresca said. "The technology is very cool and very easy to use."
According to trade journal Adweek, the increasing popularity of smart phones and consolidation in the cell phone industry has mobile marketing poised to explode. Still, many players are sitting on the sidelines until the technology takes off.
Maresca's customers would send a text message to a certain number, and within seconds a coupon would be sent to their cell phone. They would then show their phone to the cashier, who would give them the specified discount.
"We would have a sign by the front of our restaurant that said 'text Moe's for such-and-such an offer,'" Maresca said. "The customer would do that, and by the time they reached the counter they had the coupon."
Maresca began including text message information in his print, radio and in-store advertising. Over the course of his 90-day trial, about 700 people took advantage of the service.
Still, he said, he frequently found himself explaining the concept of mobile marketing to his customers.
"Overall, we didn't have the best success with it, but I think it was just early for that form of advertising," he said.
Instant gratification
But while mobile marketing's time may not be here, it's not too far off, either. More and more companies are making use of the technology.
Research firm eMarketer projects mobile ad spending in the United States to increase from $1.7 billion in 2008 to $2.8 billion next year.
Ivar's Seafood in Seattle offered "Mollusk Mail" text messages deals that were a hit, Ivar's officials said.
And last summer Carvel's Ice Cream shops launched a mobile marketing program where customers received coupons for one of the restaurants new blended coffees as well as to enter for a chance to win one of five 42-inch TVs.
"We worked with Brand Movers on developing a text messaging program where consumers could opt in to receive future text alerts from Carvel, but would not be subject to spam on their cell phones," said Lori Peterson, director of marketing for Carvel Ice Cream. "It was important that participants receive instant gratification, which is why all 'texters' receive a coupon immediately, even if they are not winners of the sweepstakes."
Proof in the numbers According to a March 2008 study by New York-based research firm The Nielsen Company, 23 percent - 58 million - of all U.S. mobile subscribers say they've been exposed to advertising on their phones in the past 30 days.
Half of those subscribers, or 28 million, who recalled seeing mobile advertising in the previous 30 days said they responded to a mobile ad in some way.
Mobile coupons are well-suited to the restaurant industry because offers can be delivered to potential customers right about the time they make a dining decision. Operators can send out text offers at around 4:30 p.m., just when people are thinking about what to have for dinner.
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Currently, mobile coupons operate in a number of different ways. While many services send text-message offers directly to customers in the operator's database, other services, such as San Jose, Calif.-based Cellfire, use an application that customers download to their cell phone.
Customers can then choose from a variety of coupons from different merchants. Cellfire provides users with a unique code that is shown at the time of a transaction. Users simply click on the coupon they want to use and show it to the sales cashier to receive the discount.
Getting the message out quickly
The messages can be nearly immediate. Jeff Leach, cofounder of New Orleans-based Naked Pizza, noticed it was about to rain one evening, so he typed out a message on his computer which read, "It's about to rain. Let us bring you a pizza for dinner."
Within minutes, the message, which also included a 2-for-1 pizza offer, was sent to the cell phones of the 400 or so people who had signed up for Naked Pizza's text-message coupon service. A few minutes after that, the calls started to come in.
Maresca had similar experiences, he said.
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"That was the coolest part," he said. "You could set up messages on the fly."
For Leach, time will tell if mobile coupons will remain a part of his marketing strategy. While redemption rates for his coupons approach or even surpass those of paper direct-mail coupons, the cost doesn't always justify WHP going mobile, he said.
Leach pays 10 cents per impression for each text offer he sends, so sending a text coupon to 400 customers costs him $40.
"I'm not sure long term how effective it is going to be, but overall it is a positive," he said. "We just haven't figured out the best way to use it yet."
