Thursday, April 24, 2008

What's in Santa's Sleigh?: Mobile Search Advertising and Color Barcodes

Ever seen the original version of Miracle on 34th Street? One of the best scenes is when Kris Kringle, taking a toy request from a child in Macy's, tells a distraught mother that she can get the toy at Gimbels, Macy's big competitor. The marketing executives take it three steps further, compiling a local merchandise directory so that sales associates can send customers to the right store if Macy's doesn't have what they're looking for. The hope, in this case, is that customers will be so impressed by the good will and helpful information at Macy’s that they will come back more frequently and spend more money there (as one happy mother exclaims).

I don't know if Macy's ever did try in the real world the strategy that worked so well for them in the movies, but I've yet to come across something similar today. In my mind the closest thing we have in the digital era is Priceline, but even with William Shatner batting for consumers, it's still missing a hefty dose of benevolence.

But perhaps a new contender is coming up on the horizon. In particular, Amazon recently announced a modern version of this Miracle approach called TextIt, a new service where customers browsing in a real retail bookstore can use their cellphones to scan the barcode on a book or other item, get its information and price, and order it directly through Amazon (if available). Not exactly the kind of goodwill gesture that Santa Claus might endorse, but one that many digital merchandisers are counting on as a competitive edge. Adweek highlights recent research predictions that mobile search advertising will have phenomenal growth in the next five years. The foundation for these prognostications is the speed at which companies are trying to develop their software for mobile phones. Better photo quality on cell phones and more standardized barcodes are the key concerns, and both are actively being addressed by multiple vendors. As if to seal the future deal with a kiss, Microsoft announced today that it had patented a color barcode licensed by the International Standard Audiovisual Number International Agency.

The beauty of the color barcode, aside from its visual design appeal, is adaptability. According to Microsoft's press release , though they can be physically smaller these multi-colored codes can be read from more places, like televisions, posters, advertisements, CDs, and computers. As a simple example, imagine seeing a print ad for a movie posted at the train station. While you’re waiting to commute in to work, you can use your phone to scan the barcode on the poster, watch a trailer for the movie and find nearby theaters and playing times without having to type in phone numbers or a ton of additional information.

As I mentioned in a prior post, some analysts have even predicted that the cell phone will be the death of modern advertising, which will have to morph into something else. Consumers are more involved in tracking and debating the value and significance of various products than ever before. Indeed, perfume blogs have garnered such consumer power that they have upended a lucrative and previously unfettered industry, leaving marketers and manufacturers with great distaste for the intrusion. Even so, the balance of digital power tends to remain with manufacturers.

While the new tracking media has great potential, it still has a number of problems. Barcodes and cell phone technology have made more inroads in Southeast Asia, but critics cite multiple standards and lack of consumer awareness and education. Microsoft hopes to use its gigantic reach to address the first problem. As for the second, consumer use is not as advanced as technological desire partly because people are unaware of the capabilities. Let’s face it: so much technology, especially the mobile digital kind, spreads when it’s picked up by the magic demographic – young users with some disposable income and a desire to be on the cultural cutting edge. But these users also move on quickly if the application doesn’t have an interesting or innovative purpose (see this great chart on the quick boredom with Twitter). Even with a recent trend towards thrift in the younger demographics, comparison shopping and bargain hunting are still more in the worldview of an older demographic.

Developers might need to think more broadly right away, rather than waiting for people to figure out new uses on their own. It's not like companies are going to hold our hands and point in the direction of their competitors until everyone gets up to speed. I have a feeling it’s going to be a while before Microsoft hands consumers a color barcoded guidebook to getting what they want. Perhaps we're better off believing in Santa.

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1 comment:

David Weinfeld said...

Mobile marketing will bridge the gap between traditional media and the conveniences of the online world. But, mobile barcode scanning is years away from mainstream use in the United States.

The biggest barrier to this type of mobile integration is people downloading the necessary application to read the barcodes. Perhaps if Microsoft builds the requisite application into its mobile operating system, we'll see mainstream acceptance much faster and on a larger scale.