Proximity marketing: NFC vs. Bluetooth and Wi-Fi

This vendor-written tech primer has been edited by Network World to eliminate product promotion, but readers should note it will likely favor the submitter's approach.

Near field communication (NFC) is being hailed in some quarters as the future of mobile marketing. NFC tags that are embedded in products or on posters and signage can open a mobile browser in an NFC-enabled device (such as a smartphone) to transmit an offer or message. To start the communication, the consumer simply taps his or her smartphone to the tag to receive the transmission wirelessly.

NFC technology has made inroads as a mobile payment tool, such as the Google Wallet, which allows wireless payment via a smartphone app. And it's starting to appear as a proximity marketing tool in places like city bus stops, subway platforms, shopping mall kiosks and other venues to transmit advertising messages. It's definitely a trendy way to communicate with consumers in a proximity marketing setting.

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Currently, Bluetooth and Wi-Fi are the primary platforms enterprises use to transmit proximity marketing messages, but some analysts expect NFC to become a significant rival. In fact, some contend that NFC will eventually overtake other proximity marketing communication methods and become the dominant way to conduct a location-based advertising campaign.

But there are significant obstacles to this scenario. One barrier to consumer receptiveness to NFC campaigns is that smartphone users may have to download an app to use the NFC tag to receive messages. Virtually every smartphone already comes equipped with Bluetooth and Wi-Fi capabilities.

Another potential barrier is that NFC ad campaigns require consumers to initiate the engagement. First, they have to read the poster or sign, and then they have to decide to tap their device to receive the message. Since many consumers are already engaged with content on their devices in public spaces, they are less likely to notice the invitation to receive the message.

Also, due to NFC's limited transmission field, consumers must not only notice the printed ad and decide to make the connection, they must get close enough to the NFC tag to initiate the message. As the novelty of NFC tags wane, it's an open question whether or not consumers will be willing to read and respond to advertising messages that require that level of effort on their part.

Advantage: Bluetooth and Wi-Fi?

In contrast, Bluetooth and Wi-Fi-based proximity marketing campaigns use a technology that is already standard on nearly all handsets to deliver an opt-in message directly to the device that consumers already use for most of their communications on the go. Consumers aren't required to initiate the transmission: A well-designed Bluetooth/Wi-Fi campaign sends a message to all consumers who come within range, which can be as far away as 300 feet. Consumers who opt to receive the marketing message can do so by simply touching their device screen.

Since Bluetooth is a ubiquitous wireless data sharing tool that comes pre-installed on practically all smartphones and consumers are now used to using Wi-Fi in public places, both technologies are familiar, and tech-savvy consumers generally understand that they can safely receive messages via Bluetooth and Wi-Fi without unwittingly transmitting private data. This familiarity gives Bluetooth and Wi-Fi a distinct advantage over competing technologies when it comes to proximity marketing.

But asking whether or not NFC will overtake Bluetooth and Wi-Fi may be asking the wrong question: Who says there can't be multiple methods of conveying proximity marketing messages to consumers?

Enterprises currently use a variety of methods to get their message out, including print, radio and online ads. Bluetooth and Wi-Fi are particularly effective in the proximity marketing space because they initiate communication via a tool -- the smartphone -- to which consumers reliably and voluntarily devote their attention. But there's no reason enterprises can't take an "all of the above" approach. The key is to examine potential ROI and make an informed decision.

Alex Romanov is CEO of iSIGN Media, a leading North American multiplatform advertising solutions company that utilizes Bluetooth, Mobile, Wi-Fi and Location-Aware technologies to deliver rich media, permission-based messages to engage consumers more deeply and cost-effectively. Find out more at http://isignmedia.com/.

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