Getting pizza coupons by text message
More local businesses may try to drum up business by sending ads and discount offers to your cell phone. But will users accept marketing by mobile?
By Patrick Baltatzis, Business 2.0 reporter

You know those pizza coupons you find hanging on the doorknob when you get home?

Soon you'll be getting the equivalent on your cell phone, if the plans of mobile marketers come to fruition.

Some advertisers think this is the next hot thing, while others worry that consumers will find it as intrusive as those paper door-hangers and other circulars that pile up on doorstops.

Annoying or not, door-hangers are effective at generating sales because they hit consumers where they live. Similarly, new technologies like Bluetooth, infrared, and Wi-Fi are making it easier and potentially cheaper than ever to reach consumers by mobile when they're just about to walk into a shop.

They also allow for targeted marketing. In the Boston area, a number of companies have signed up with MobileLime, a startup that allows consumers to pay for purchases with their cell phones. Users also can opt in to get text messages of special promotions -- including, yes, deals on pizza.

Raffi Hovagimian, owner of Waltham Pizza, says that more than 100 of his customers have signed up for MobileLime, most of them regulars who order pizza several times a week. When he recently started a 15% discount for MobileLime customers, he sent out text messages to customers, and he says he plans to do more mobile marketing.

"It's going to be useful to fill in slow periods like a Monday night or afternoons between 2 and 6," says Hovagimian.

While Hovagimian still uses door-hangers to advertise, he notes that those carry considerable printing and labor costs to distribute.

"In this day and age, the cell phone is the way to go," says Hovagimian.

Messages at the mall

In the ultracompetitive retail sector, locally targeted wireless advertising could be just the thing to lift sales. The millions of people who visit shopping malls every day are a natural audience: By setting foot in a mall, a consumer is all but announcing his intention to buy something.

Westfield, one of the nation's big mall owners, is studying the market closely, but has yet to pilot a project, according to Scott Peterson, the company's strategic technology manager.

"We have installed Wi-Fi hotspots in 43 of our properties over the last two years, says Peterson. "And marketing through Bluetooth is something we will look into, because it could help shoppers use their time more effectively and make our retailers more successful."

Getting promotions on sales and events may not be what shoppers want, though. A recent study by the Mobile Marketing Association reports that only 24 percent of consumers surveyed are interested in promotional alerts.

"The average customer is targeted with more than 3,000 marketing messages a day, so people have developed a resistance," says Erik Hauser, CEO of Swivel Media, a creative agency which has done mobile marketing work for clients like Wells Fargo.

Killing time

Much depends on location and context, says Nihal Mehta, founder and CEO of Ipsh, a mobile-messaging services company that has consulted with clients ranging from Madonna to McDonald's (Research).

On a recent visit to London, Mehta received ads on his phone in the subway via Bluetooth, a short-range wireless technology.

"All of a sudden my phone started beeping," recalls Mehta. "I was asked if I would like to take look at the new Audi A6 car on my phone." Although it struck him as a bit intrusive, Mehta accepted the ad out of curiosity.

Mehta says Bluetooth advertising does best in an environment like a subway station or an airport lounge, where consumers are inclined to kill time and may be more receptive to a commercial message. Since his visit to London, he's recommending installing cheap Bluetooth transmitters to all of his clients.

As advertisers experiment with the medium, they may find it's more cost-effective to advertise a pizza shop down the street than a luxury car. And text messages have one key advantage over door-hangers: They're infinitely easier to discard.

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Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer LIBOR Warning: Neither BBA Enterprises Limited, nor the BBA LIBOR Contributor Banks, nor Reuters, can be held liable for any irregularity or inaccuracy of BBA LIBOR. Disclaimer. Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.