Mobile Coupons Bring Ethics Questions For C-Stores

The mobile coupon is one of the many new ways to advertise to a new generation of cell phone-toting customers. 7-Eleven is almost finished with its two-month trial of mobile coupons, which it debuted in 200 stores San Diego in November, and the chain is preparing to extend the trial.

7-Eleven has avoided some of the read-rate accuracy problems that have affected trials at other companies, but it is running into some ethics issues that surround the new world of mobile marketing, CBS News reported.

For one, mobile marketing requires the chain to collect phone numbers and E-mail addresses-and some of the target customers are ages 14-16, who then are mixed into a target group of young adults, as old as 24.

“Is a retailer courting perception trouble when it offers free sodas to try and get under-age customers to give up their phone numbers? Without knowing ages, does this force the chain to treat all of the participants with – please forgive me – kid gloves? That approach certainly seems safer than assuming they are all adults and risking parental wrath for marketing to a 14 year-old,” wrote Evan Schuman, the editor of StorefrontBacktalk, a site that tracks retail technology.

7-Eleven has outsourced many of the trial’s logistics to mobile marketing firm GMR Marketing. TJ Person, a senior vice president at GMR and in charge of the 7-Eleven trial said that having an “opt-in” protects the company. “When we ask for an opt-in, we assume they’re more than 13,” he said.

The trial began Nov. 1 and concludes Dec. 31,  although Daniel May, 7-Eleven’s marketing manager in charge of the trial, said the chain may continue testing mobile coupons outside the San Diego area in 2010. He told CBS News the trial was done as a strong opt-in campaign, which should minimize later complaints of unsolicited ads. The consumer must initiate the trial by texting a message-“FAST”-to 72579. Consumers are then told they’ve been awarded a free beverage (Slurpee, Big Gulp or coffee). Once the consumer shows up at the store, that they are offered two ways to redeem the chosen beverage.

“Customers with Internet access on their wireless devices will be able to click through to a screen displaying a UPC bar code, which can be scanned at the cash register. For other wireless users, the 7-Eleven sales associate can enter the selected numeric code on the cash register for redemption,” said a statement issued by the chain to explain the trial. “The codes are only good for the free beverage indicated in the coupon. The message also includes an invitation to receive future text messages with 7-Eleven news and offers.”

The trial was designed to test whether consumers would be comfortable using their phones in this way, and to attract Gen Y/Millennial consumers.

“Mobile marketing is the next step to reach our target customers: the Millennials who don’t go anywhere without their phones,” said Rita Bargerhuff, 7-Eleven’s vice president and chief marketing officer.

But the trial is also looking at how the Hispanic demographic responds to mobile marketing.

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