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Dead phone batteries. Wrong merchant terminals. Terminals turned off. Terminals unrepaired. No terminals at all.

These and other, less obvious glitches suggest contactless technology may not be the mobile payments panacea for tattered magnetic stripes and other problems with plastic cards. Not without some serious problem-solving, anyway.

In hyping mobile payments, many proponents focus on the way point of sale transactions could change, frequently describing people who leave home without their wallets but never without their phones. But that oft-cited cliche is not likely to become reality anytime soon.

"I'm sure there will be mobile payments, … but I have a hard time believing that I'm not going to still be carrying a wallet at least with my ID and at least with my insurance card," said William Rossiter, the vice president of marketing at the terminal maker Hypercom Corp. "It will be a slow transition."

Nick Holland, a senior analyst at the Yankee Group research firm in Boston, agreed.

"For the next, arguably, 20 years, people are still going to be carrying a wallet on them because there are always going to be places that" do not accept contactless cards, Holland said.

When the payments networks several years ago began pushing contactless cards, which let a consumer pay for a transaction by tapping the card against a payment terminal instead of swiping it through, "there was a lack of consistency in terms of telling people what the cards can do," he said.

As a result, merchants were slow to upgrade to terminals that could read contactless cards, and those that did often failed to maintain them to keep them in working order. Many people also were unaware that their debit or credit cards were equipped with the technology.

"The issue of the readers not being turned on or not working — this is an issue that happens when you have a lot of readers without a lot of cards or a lot of readers without a lot of cards that consumers know they have," said Todd Ablowitz, the president of the payments consulting firm Double Diamond Group LLC in Centennial, Colo. "It's a matter of, when something does go wrong, which is inevitable, if nobody notices, then it doesn't get fixed."

All that said, developers of mobile payments technology acknowledge the potential problems and plan to address them.

"We have been thinking through those things and have different plans in place," said Troy Bernard, the director of emerging technologies at Discover Financial Services.

Breaking or losing a phone would be handled similarly to losing a plastic card, Bernard said, requiring the consumer to contact a wireless carrier for a replacement and to remotely wipe the lost handset if necessary. Depending on the business model, a consumer may also need to contact the bank that issued his payment card account.

A situation in which a consumer's near-field communications-enabled phone dies could be addressed in many ways.

Dave Wentker, the head of mobile products at Visa Inc., said some handset manufacturers may enable contactless capabilities when a handset is not charged, though they can also take the opposite approach and require the phone to be switched on before payments are allowed.

On the terminal side, Bernard and others predicted that the advancement of mobile payments is likely to prompt merchants to upgrade to contactless terminals.

"We definitely see the NFC device being [a] differentiator … from its contactless card predecessor in that it has two-way communication at the point of sale and location-based services so merchants can deliver real-time offers," Bernard said. "That's where we see a lot more promise in NFC."

More than 100,000 merchant sites are equipped with Discover's Zip contactless specifications, said Bernard, who did not rule out subsidy as a strategy for getting retailers to adopt the technology. This was the tactic adopted by payments networks several years ago when they began promoting the technology.

"I think it's a viable short-term strategy to get key merchants to accept the NFC or contactless payment device, but there needs to be two sides," Bernard said. "You can seed the market with terminals but then you need a proliferation of the NFC handsets and stickers … so it feeds off of each other."

Hardware makers are taking steps to ensure merchants have access to accept mobile payments if and when the systems take off.

"Our value proposition to merchants is, we want to help them future-proof their investments," said Steve Elefant, the chief information officer at Heartland Payment Systems Inc.

The Princeton, N.J., payments processor's E3 terminal gives merchants the ability to add on hardware and software to accept contactless payments, Elefant said.

"We can't talk to a tier-one retailer today without talking about contactless and NFC," Hypercom's Rossiter said.

In any event, proponents of contactless payments say the doomsday scenarios should not impede adoption of mobile payments, if only because users should be able to fall back on current payment systems for the foreseeable future.

"In all the pilots and in all the commercial launches that we are planning for the next few years, it is expected that the consumer will have at his disposal multiple ways of making payments, as happens today," said Deepak Jain, the president and chief executive of DeviceFidelity Inc. The Richardson, Texas, company is working with Visa on mobile payments trials with Bank of America Corp., JPMorgan Chase & Co., Wells Fargo & Co. and U.S. Bancorp, tests that involve using DeviceFidelity's payment-enabled In2Pay microSD cards with smartphones.

"In your wallet you have multiple ways of making payments," Jain said. "You've got your debit card. You've got your credit card. You've got a prepaid card. You've got some cash."

December 22, 2010

The Nielsen Company released a list of the most popular media and consumer spending trends in the U.S. for 2010, covering everything from the most popular television shows, to the most liked commercials, book sales, purchasing trends, top mobile apps and more.

Download Nielsen’s top 10s and trends in the U.S. for 2010.

Top 10 TV Programs – Single Telecast
Rank	Telecast	Originator	Date Aired	Total Persons Rating
1	Super Bowl XLIV	CBS	2/7/10	36.5
2	Super Bowl XLIV Post Game	CBS	2/7/10	25.8
3	Super Bowl Kick-Off	CBS	2/7/10	20.8
4	FOX NFC Championship	FOX	1/24/10	19.8
5	AFC Championship on CBS	CBS	1/24/10	16.1
6	Academy Awards	ABC	3/7/10	14.3
7	Undercover Boss	CBS	2/7/10	13.2
8	FOX NFC Playoff-Sun	FOX	1/17/10	12.9
9	AFC Divisional Playoff-Sun	CBS	1/17/10	12.2
10	FOX NFC Wildcard Game	FOX	1/10/10	11.8
Source: The Nielsen Company. *Top Telecasts: Note: Data from January 1, 2010 – November 28, 2010. Persons 2+ Ratings include Live and Same Day timeshifted viewing. Excludes telecasts under 5 minutes.

Top 10 TV Programs – Regularly Scheduled
Rank	Program	Originator	Total Persons Rating
1	American Idol -Tuesday	FOX	7.9
2	American Idol -Wednesday	FOX	7.5
3	Dancing with the Stars	ABC	7.1
4	NBC Sunday Night Football	NBC	7.0
5	Dancing w/Stars Results	ABC	5.5
6	Sunday Night NFL Pre-Kick	NBC	5.3
7	NCIS	CBS	5.0
8	NFL Regular Season L	ESPN	4.9
9	Survivor: Heroes-Villains	CBS	4.3
10	NCIS: Los Angeles	CBS	4.2
10	Two and a Half Men	CBS	4.2
Source: The Nielsen Company. *Top Primetime programs: Note Data from January 1, 2010 – November 28, 2010, regularly scheduled programs. Persons 2+ Ratings include Live and Same Day timeshifted viewing. Excludes programs with less than 4 telecasts and programs under 5 minutes.

By Giselle Tsirulnik

December 16, 2010

Bank of America promotes its mobile banking services on its Web site

Sixty-two percent of Fortune 50 companies use mobile channels to reach their customers, but few promote their offerings using existing media, according to a study by Burson-Marsteller.

The research found that only 39 percent of companies with mobile offerings highlight them on their corporate Web sites. The study examined whether Fortune 50 companies offer mobile-optimized Web sites, mobile applications, SMS/text messaging, or 2D bar codes to communicate externally.

“Companies should promote their mobile offerings via every channel possible,” said Ashley Welde, director of research and insights at Burson-Marsteller, New York. “Mobile should be just another piece of the integrated marketing pie. 

“Just as some companies now have a Facebook or Twitter icon on their home pages to make it easy for visitors to connect with them via social media, there should information on the home page about how to connect with the company via SMS/text, and there should be an image of the company’s Web site on a mobile phone,” she said. 

“Email customers to let them know what mobile tools are available. Put QR codes on magazine ads that link to the company’s mobile Web site or to download the company’s mobile applications. The possibilities are endless.”

Burson-Marsteller, established in 1953, is a global public relations and communications firm.

Who has what?
Specifically, the study found that 38 percent of Fortune 50 companies have mobile-optimized Web sites and an even higher proportion (58 percent) of companies offer a mobile application on iPhone, Android or BlackBerry.

Companies were most likely to develop applications for the iPhone (58 percent) followed by Android (32 percent) and BlackBerry (26 percent).

The study found that a company’s first foray into mobile is often by building an iPhone application, but brands should also think about developing a basic mobile-optimized Web site, per Burson-Marsteller.

Making basic Web content easy to read and interactive via mobile will enable all smartphone users to connect with brands anyplace and at anytime, regardless of mobile device or operating system.

“One might have guessed that optimizing existing digital content from the company’s corporate Web site for a mobile device would have been the first step towards a mobile offering, but instead companies are opting to build applications,” Ms. Welde said.

“This is also surprising because a mobile-optimized Web site can benefit any stakeholder with a smartphone, whereas a mobile application will only serve stakeholders who have the type of phone that the application is designed for,” she said.

“For example, an iPhone app will be useless to Android and BlackBerry users. Why not develop a mobile-optimized Web site that could be enjoyed by all three, and then focus on platform-specific apps?”

Mobile use cases
Twenty-two percent of Fortune 50 companies are communicating with stakeholders via SMS/text message.

Forty-three percent of the Fortune 50 have mobile Web sites or applications that are enabled for mobile transactions such as shopping, updating account information, refilling prescriptions or transferring money.

Twenty-two percent of the Fortune 50 are placing QR codes in magazines, on billboards, or at any convenient location to deliver relevant content to smartphone users.

“It’s surprising that companies are not using every possible touch point to make customers aware of their mobile offerings, and that they are missing an opportunity to interact with customers via mobile for lack of a simple description of their mobile tools,” Mr. Cordasco said. “It seems like they’re wasting their investment in mobile if they’re not flaunting it.

“My first recommendation is to start off with a mobile-optimized Web site, because that can be accessed by all smartphone users,” he said. “The second is to make sure that mobile tools do more than just spit out company information one-way. The mobile tools should enable transactions. The third is for companies to communicate their mobile offerings through any channel possible. 

“Consumers are way ahead of businesses with how they’re using mobile and will only take advantage of a company’s mobile tools if they know about the tools and they’re easy to find. Another detail is for companies to make their contact information very prominent on their mobile Web site as many people are using mobile Web sites to try to contact a company.”

The top 10 apps cited among the male respondents who use mobile apps were Google Maps (14%), followed by Facebook (13%), Pandora (6%), Weather (3.2%), ESPN (3.1%), Angry Birds (2.0%), Words With Friends (1.4%), Shazam (1.3%) and Yahoo (0.9%).  Twitter and Yelp! tied for tenth place (0.8% each).  For female respondents, the top 10 app picks were Facebook (27%), Google Maps (7%), Weather (5%), Pandora (4.5%), Twitter (2.9%), Google (2.5%), Words With Friends (2.4%), Shazam (1.4%) and Solitaire (1.1%).  Bank of America and “Calendar” tied for tenth place (0.9% each).

Despite the seemingly endless hype over apps, the most interesting part of the study was the finding that almost half (48%) of the respondents said they used the mobile Web more than apps on their smartphones.  For mobile marketers and advertisers, the question remains: Are mobile websites a viable and, in some cases, more cost-efficient option to consider?