NFC Social Marketing Panel Seeks to Shift Attention Away from Payment
Such nonpayment applications as marketing campaigns and loyalty programs are more likely to drive adoption of NFC than payments, panelists told attendees of a recent “NFC Goes Social” event in Boston, organized by the MIT Enterprise Forum's NFC Cluster.
The panel focused on social marketing, advertising, loyalty and other nonpayment applications, which they believe will drive adoption of NFC technology.
“Social media is the buzzword not only of the year but probably of the decade,” said panel moderator Ed Mitukiewicz, adding that use of social media is increasingly shifting to mobile devices, providing potential uses for NFC-delivered content.
The forum marked a shift in focus from mobile payment, which often dominates discussions about NFC. Panelists agreed that despite the attention given to payment, such nonpayment applications as marketing campaigns and loyalty programs are more likely to drive adoption of NFC. But these applications could also spur use of NFC devices for payment.
“Swiping and tapping are very similar payment activities,” said Matt Kammerait, product manager for interactive print solutions at printing house Quad/Graphics. “From the consumer perspective, why change unless there’s some really compelling reason to make that jump?”
Mikhail Damiani, CEO of outdoor media company Blue Bite, said he expects nonpayment applications to provide that reason. He later told NFC Times that the “more applications we see in retail, marketing, social, transit, etc., the more likely NFC payment systems are to come into play. The numerous applications raise awareness and eventually demand from consumers for this sort of interactivity and ease of use.”
Patrick Meyer, CEO of NFC marketing company thinaire, told NFC Times he expects retail NFC marketing to increase uptake of the technology: “So the large chains and big box retailers will come first and others will follow. In the interim, the NFC marketing activity will move across retail and media to drive NFC until national NFC payments sorts itself out.”
Consumer Awareness Key
Questions from the audience focused on issues surrounding consumer and merchant uptake of NFC. During and after the event, speakers highlighted consumer awareness as a key ingredient for wider uptake.
Meyer told NFC Times he believes that consumer awareness of NFC relies on four sources: advertising from device manufacturers, education at mobile carrier points of sale, NFC-based connectivity options for consumer electronics and content on tags at retail locations, events, and entertainment venues. He predicted that these four sources of awareness “will drive word-of-mouth social activity that makes it mainstream everyday."
He said during the forum that he believes mobile carriers have an important role to play in educating the consumer. “Starting with the salesperson, they should be doing a demo, showing you about NFC.”
Both Meyer and Greg McHale, CEO of social NFC startup good2gether, credited advertising by mobile phone maker Samsung with increasing consumer awareness. McHale, whose company works with nonprofits, which he describes as “technology averse,” said Samsung’s approach was effective because “they don’t call it NFC, but everyone’s seen the ads.”
Speaking of Apple
Discussion of increasing consumer interest in NFC also raised the question of Apple’s possible adoption of the technology. Many see Apple’s decision to pass on the technology in the iPhone 5, as a roadblock to widespread NFC use because of Apple’s share of the smartphone market and influence on consumer habits.
David Merel, CEO of customer loyalty and reward company SocialPassport, told NFC Times that “whether Apple jumps onboard” is the greatest challenge facing the technology in the year ahead. “Until we can have the two top mobile OS platforms leveraging NFC it will be difficult to get widespread adoption,” he said, referring to Android and Apple’s iOS.
He added that Apple's decision not to support NFC yet may have something to do with how Apple plans to use it and how ready it would have been with the technology. “As we have seen with Maps on the iPhone, sometimes it's best you don’t launch a product if you know you're not 100% ready,” Merel told NFC Times.
Kammerait of Quad/Graphics said Apple is waiting for “a point of consumer utility,” which relies on the deployment of NFC campaigns that deliver content consumers see as valuable.
“If there are crap NFC campaigns deployed for the next six to 12 months, the consumer will have the same breach of trust that they have with QR with NFC and then perhaps the technology gets passed over altogether,” he said during the panel.
Mixing Entrepreneurs and Academics
The NFC Cluster, one of several groups that make up the MIT Enterprise Forum, allows entrepreneurs and industry players to mix with MIT staffers, including lab researchers, said Damien Balsan, former head NFC business development in North America for Nokia and now director of ecosystem partnerships at PayPal. He co-founded the NFC Cluster with Stephen Miles, who heads RFID initiatives in MIT’s Auto-ID Lab.
The cluster holds events about every other month, organized around one of four themes, payments, social networking, health care and consumer electronics. The group also holds an annual hackathon.
Balsan noted that the NFC App Inventor, an online application-programming interface for Android developers introduced in March 2012, came from the cluster and from Google. The Center for Mobile Learning at MIT developed the interface with NXP Semiconductors; UPM RFID, now Smartrac; and digital advertising agency Isobar. The center demonstrated it at the third annual Auto-ID-Sensing Solutions Expo, an NFC Cluster event.
Miles told NFC Times that about 75 people, out of about 100 who preregistered, turned up for the Feb. 11 NFC Goes Social panel amid a record snow storm in the area. Physical attendance for the event was lower than previous events, and Miles attributed that to the inclement weather. He said that just over 1,000 users viewed the video of the event afterward as of last week.
‘Nonprofits Terrified of Smartphones’
Each of the panelists at the event has supplied NFC technology to the market or is planning to do so.
Blue Bite’s Damiani said his company is providing NFC technology for a Samsung smart poster campaign running in Boston, Chicago, Dallas, Los Angeles, New York, Philadelphia, San Francisco, Toronto, and Washington, D.C. Users who tap NFC tags in the posters can download free music, videos, and other content.
“What we do is basically bridge outdoor media–digital media that you see outside of your house–with the mobile device,” he said.
Damiani declined to say how many posters are deployed or how many consumers had tapped the tags so far.
Massachusetts-based startup good2gether will provide a platform that lets consumers see which local businesses support participating charities. The businesses will be able to use NFC to check in on social media and sign up for notifications about “DoGood Deals,” in which the businesses donate a percentage of specified purchases to a local nonprofit.
Customers will be able to access the platform with a smartphone application or by tapping NFC tags or scanning QR Codes on “DoGood Badges” that businesses and nonprofits post on their doors.
“Nonprofits are terrified of smartphones,” said good2gether’s Greg McHale. “This is a cool way for them to get into this in a really positive way.”
Businesses and nonprofits will be able to track social media interactions and see how many users add them to favorites lists. The platform will be free for nonprofits, and good2gether has not yet publicly discussed its pricing for businesses. The company plans to roll out the NFC-enabled badges in the second quarter of 2013 and launch the platform in June. McHale told the audience that “based on the reaction that we’re getting, this will launch with thousands of local businesses.”
SocialPassport provides social marketing and loyalty programs to businesses. Establishments can offer customers rewards or discounts for liking or sharing messages about the business on social media, checking in at the business on Facebook or foursquare, or tapping a tag at the point of sale to use a mobile loyalty card.
NFC’s Advantages over QR Codes
SocialPassport’s Merel told NFC Times that NFC offers advantages over QR codes for this type of marketing at restaurants and similar business.
“QR becomes difficult to impossible in low light areas and so many restaurants that dim their lights or bars that have very little lighting are unable to use QR,” he said. “Additionally, QR becomes difficult in high-paced environments when the line needs to be moved quickly and nobody has time to focus their camera to scan a code. In every deployment we have made where users had NFC, an NFC user was able to perform their loyalty or marketing action in half the time or less than a QR user who was scanning.”
Marketing company thinaire recently participated in a retail marketing campaign with food supplier Kraft and advertising company NewsAmerica. The companies placed NFC-enabled advertising cards on shelves in five San Francisco-area Safeway supermarkets in areas with roughly 25% penetration of NFC phones.
Thinaire's Meyer said that customers spent an average of 48 seconds on the NFC-enabled advertisements, compared with a 5- to 10-second average for print-only advertisements. Of the customers who tapped the tags, 36% downloaded the offered recipe, shared the recipe with a friend, viewed another recipe, or downloaded a cooking application.
Printing house Quad/Graphics prints for such publishers as Condé Nast, whose titles include technology magazine Wired. The interactive print solutions line, managed by Kammerait, is “ basically anything that connects print to electronic media,” he said. To accomplish this, the company uses or has tried QR Codes, augmented reality, image recognition and NFC.
In April 2012, Quad/Graphics incorporated NFC tags in an ad for luxury car maker Lexus that ran in 500,000 copies of Wired sent to U.S. subscribers. Tapping the tags directed readers’ NFC-enabled smartphones to a Web site, where they could view a promotional video about the 2013 Lexus GS and other content focused on the car’s navigation and app features. The campaign drew attention from both advertisers and the NFC industry.
“People always ask what was the result here,” Kammerait said. “As with any interactive print implementation, on the hard side, there were tens of thousands of unique responses over the course of the over 500,000 tags, so you do the math and figure out the response rate; this is MIT. If you look at the soft side, it also generated exponentially more impressions than were available just from that printing," due to media coverage of the campaign. NT