Mobile Marketing & LBS: What's Next for Advertisers?

In the early years of mobile marketing, "push marketing" was the big thing whereby the mobile consumer would be happily strolling by his favorite retail store and he would suddenly receive an advertisement on his mobile handset. Of course, frequent buyer programs needed the appropriate privileges, but the idea was perhaps ahead of its time and certainly the handsets were not yet equipped with the technology to derive an approximate location. Plus, five years ago, access to the Internet was spotty and certainly not yet available on cellular phones. Tasks that are routine today were difficult back then.

But this is 2006 and both technology and the consumer have reached a level of maturity that allows different business models to take shape. Zoove Corporation is looking to make it easier to link product information directly with the mobile consumer through "pull marketing." Zoove enables consumers to "dial-up" information directly to their mobile device when prompted for a "call to action." For example, a potential customer is walking past a retail electronics store and sees an ad for the latest iPod. The "call to action" to find more information about the iPod is a number to dial preceded by star-star (**) on the phone's keypad. The number to dial could be: **iPod or **4763. After dialing the number, the customer will receive product information. However, Zoove uses the SS7 protocol that provides information to the marketer about the type of cell phone in use, the carrier, and the location of the customer, in much the same way a 911 call can identify those same characteristics. Thus, the ** dialing sequence enables some key demographic characteristics to be transmitted to the marketer.

So, just as in the early years when marketers found it necessary to include their URL with print, TV or other media advertising, the same may be coming to pass for Zoove-type numbers. Tim Jemison, CEO of Zoove, outlines three primary elements taking place behind the scenes of intelligent networking afforded by the SS7 protocol.

The ability to do handset discovery: when a cell phone user dials the code, the marketer can determine what kind of phone he is using so that the capabilities of the phone are understood and the appropriate text or graphic form can be transmitted back to it.
Display text: the ability to send a text message that barges into the screen to get information to the user.
Location-based services are enabled out of the box: Wireless Access Protocol (WAP) and Short Messaging Service (SMS) short codes can not be used to determine location. However, upon invoking the star-star message, and because the number sequence looks like a regular cellular phone call, all of the information associated with that call is transmitted to the marketer or carrier. The physical location is never revealed and the consumer receives only information relevant to him.

Jemison believes that if you are going to do anything LBS-related, make sure the consumer is in control. According to a study conducted for Zoove by Mediamark Research, " 91% of respondents successfully responded to the ads when instructed to use the star-star call service - nearly double the incidence of SMS short code completion." Zoove's target market is the brand marketer or his advertising agency. It could also be a ringtone or other content provider. Zoove's technology will work with either CDMA or GSM phones, but its focus is on the U.S. for now with trials to get underway in the fourth quarter.

The company'srevenue model can be described as "cost per click" or "cost per call" and they will participate in revenue sharing partnerships. Buying the star-star keyword, however, looks like a battle similar to that of Internet URLs.