Mobile Distribution, Procurement, and Sales

Gonca Telli Yamamoto. Mobilized Marketing and the Consumer: Technological Developments and Challenges. Hershey, PA: Business Science Reference, 2010.

Distribution, procurement and sales are powerful tools for businesses to obtain a sustainable competitive advantage. Distribution can help companies find some solutions for many challenges in producing better or cheaper products and reaching customers in highly competitive environments (Heidelberger, 2009). Almost all buying decisions include factors such as delivery and handling, marginal benefit, and price fluctuations. Combining existing product, price and brand advantages with investment in channel programs and technology is a proven strategy for establishing success with distribution. Mobile procurement has gradually become more and more important in our era. This also brings entrepreneurs new opportunities to reach customers especially in banking and press businesses but these sectors should not be forgotten that these are the easiest sectors to apply this kind of distribution. These sectors’ implementations mostly depend on communications; on the other hand, this doesn’t mean that other sectors could not employ these systems. Notably, the retail sector should be considered with all its distinctions. On the other hand, mobile sales systems are also very promising.

However, currently mobile distribution is explained in two distinctive aspects. One of them is based on the distribution of products and services side and the other one is distribution of the contents side which is very frequently used in Bluetooth and LBS systems in mobile marketing.

In this chapter, mobile distribution and sales are generally examined. LBS applications and Bluetooth marketing are taken in to account as their content delivery convenience and disparity.

Mobile Sales

Mobile sales are frequently not in usage in our current situation. These will be the new systems for customers and purchasers. When these systems are realized, facilitating business systems give several opportunities to customers they will consider important for businesses. However, such sales can be conducted in parallel to a call/data center system in an organization facilitating changes of mobile instruments incoming to the market and easily accepted within these systems. Within call/data center based sales and order follow up applications, the product is ordered through a call center representative, IVR and SMS channels, and then the order is routed to mobile distribution vehicles for fulfillment. Applications can be made from distribution vehicles and they support hot sales. So, the customer communicates with the order line via mobile devices of the delivery staff and accelerates order and delivery. Also, order automation and a CRM database can be created for such a structure. Mobile devices communicate with the center and receive delivery orders via GPRS and update the invoice data with the center.

Similar call-center based mobile sales applications are developing in the entire world. At present, many companies benefit from call centers for customer communication and complaint management as an out source. The movement of order automation to this source is also possible. As the ordering of products by people via various media and their home deliveries have shifted outside of the core businesses of companies, the system has appeared as an ideal solution for increasing both the efficiency and managing of costs. Mobile-sales related issues can be considered from three basic points:

  • Developing multi-product, campaign-supported and distribution-optimized applications
  • Developing a hot sales and order follow up application on mobile industrial devices
  • Enabling more effective work of each unit in their own areas of expertise through modular activities

The advantages of mobile sales can be listed as follows:

  • Mobilization of all key sales and company resources
    • Obtaining a fast and mobile performance on the vehicle
    • Palm top optimization
  • Wide Platform support
  • Fast spread and low cost
  • Continuous accessibility

While creating these kinds of systems, businesses prefer some modular systems to face the new situation and understand the systems better. The system cost, quality, access and support will also be another concern to businesses. The main decisions would go around with these circumstances. Therefore, modular systems should be evaluated by the ordering, distributing and managing of the transaction and financial dimensions.

The most correct time to deliver a marketing message is the time when the consumer is ready to buy. Therefore, determination of location presents very important opportunities to marketers. Via mobile phone, it is possible to know where the consumer is and to reach the label information via service providers. With this method, consumers can be reached at the shopping center that is when they are more ready to buy, and messages can also be delivered (Gökmenoğlu, 2008).

Mobile Procurement

The issue of mobile procurement comes forth further with the advancement of technology and development of location-based service systems. According to Yamamoto and Karaman (2007), the next step after e-procurement will be m-procurement. Mobile technologies are currently in the stage of development and the use of these technologies is not up to capacity; however, many products mix in with each other and turn into devices that enable m-procurement. The most important ones among them are, of course, mobile phones and PDAs. In order to maintain m-procurement, financial, technological, legal and communicative infrastructures are required to be established.

Mobile purchasing creates environments where vehicles and individuals can serve at close points when they are mobile. After the customer places the order, the vehicle nearest the mobile device with the ordered product is able to place the delivery in a very short time as a result of the developed system. Here, the pivot is the time and labor savings. The required documents are procured as mobile and they can be invoiced with a mobile signature. So, each mobile device could turn into a sales point.

Additionally, solid data bases, customer tendencies, and profiles gain importance and services can be conducted in parallel to LBS systems. Speed and correct delivery for the first time are also among the elements that increase customer satisfaction.

Mobile Distribution

These purchasing efforts should be supported with some distribution activities. Mobile distribution is the systems subsume mobile devices. These are the distribution systems that begin and/or end with a mobile connection. These systems are also in their preliminary stage at the moment. According to Ray-mund (2006) the monthly communication between distributors and their channel customers involves approximately 1.5 million inbound and outbound phone calls. Transactions take place immensely over the Web, including order placement and round-the-clock information access. Distributors also handle approximately 200,000 technical support calls per month for channel sales. And the credit services we offer keep product flowing. Some of these transactions will be skipping over to mobile systems soon. The readiness for the handling multiplying orders and to meet increasingly specialized customer needs, including the development of robust e-business capabilities are getting more importance. Oursourcing is one of the facilities that enable to cope with these issues.

With outsourcing concepts which have come forth in the business concepts of the new economy, marketing any product via various media channels, taking the order for the product and outsourcing its distribution are among the rising inter-business trends. On the other hand LBS practices and Bluetooth marketing are taken in to account as their content delivery convenience and disparity.

Location Based Services

Location Based Services (LBS) were initially used by the US Department of Defense in 1978 with a GPS satellite system consisting of 24 satellites for military purposes. In 1980, the US opened this system to the world (OECD, 2006, p.253). This opening marked the beginning of commercial applications. Although LBS navigation systems are generally considered popular instruments, they can also provide many innovative service options in countries such as India where these services do not address only to urban customers, but also to the low-income sections of cities and the rural population (IAMAI, 2008). Examples are the weather forecast information given to fishermen in deep-sea or the audio reply technology for illiterate individuals. Such attempts are also very important for the growth of countries.

With corporate solutions based on location data provided by location-based services, questions such as place of product, delivery time, place of sales team, and place of sales support team can be replied while they can also be used as personal solutions to locate “the nearest dealer, service point, or place of a friend or child”. Such location based services include geographical location assistance, emergency spot identification or the identification of the location of victims, creation of social networks to unite friends and local map assistance. In order to carry out preparations with LBS, a correct positioning technology and a geographical information system that consist of the region and location maps where mobile service providers can easily work on complex eco-system is required.

In its early days, LBS could not be very successful due to insufficient location technology, lack of standards and barriers between operators and networks, or certain other infrastructural limitations. However, in current investments, it is considered among the fundamental business models of operators. The “location” now maintains its importance with the creativity of content providers and inclusion of application developers in the game (Francica, 2007).

LBS create new styles of interactions with other users during movement in any place, region or city. With this new spatial perception, mobile phones do not remain only as instruments of building communication, but they have also turned into micro computers which are portable in social places (de Souza e Silva, 2006).

According to Juniper Research (2008), LBS are the provision of personalized services according to the membership principle in its own geographical region. LBS are not fully ‘Mobile Web 2.0’ (and as massive application has not started yet that is while pilot studies are ongoing). If it is used in combination with other applications and databases, then it enables the user to share their own location details with third parties or other applications, and to share movement of information in its own local surroundings.

In LBS, the devices are in a wirelessly connected structure that uses signals to communicate. As distances may change according to place, they are considered in three basic categories (Quinn, 2008). These are Personal Environment Networks (1-30 feet), Local Regional Networks (up to 200 feet) and Wide Area Networks (almost accessible to anywhere).

According to Fields (2005), LBS are the services that benefit from the location or place in presenting meaningful information to users. In mobile marketing, LBS applications are realized by using certain regional location information in order to communicate the right message related with a certain advertising or marketing services to the right person at the right time and place.

According to the same author, LBS index applications are generally those such as mobile search, effective search and local search. LBS index applications present meaningful local data similar to those in the online search results of Google. The basic difference of LBS index applications is that it can provide real information search and present this information in valid business locations. For example, when a customer who uses this service goes to a different city and stays at a hotel, he or she can learn the place and directions of the nearest flower shop or hospital via his or her mobile phone.

LBS index applications should not be considered just as a city or postal code because such applications are stagnant and general. However, information obtained with LBS index applications is information that describes a certain location, the address of a street or the place of a crossroad. One of the most important issues related with LBS is the ability to add special location information which could yield better results. So, it enables adding some specialized attributes into the information. Frequently, LBS can also be associated with applications that are described as automatic location information (ALI). ALI is very useful in terms of facilitating index application; however, it is not considered as a critical element in the success of LBS. LBS index researches can actually be developed with the evaluation of existing or future locations created by its users in various ways. The strongest LBS applications shall be those designed to facilitate the works of users from the source location of the user to the destination location.

There are several important drivers that will bring about a mass market breakthrough for LBS at long last. These include increasingly user firendly handsets, accelerated implementation of high accuracy, high performance positioning technology and an increasing emphasis among operators on data services to compensate for lower voice revenues.

Location-based services are divided into two: as location-based advertising and other location-based services. Here, location-based advertising has two further applications as push and pull.

For services where place and location is important, such as emergency notices, assistance services, description of interesting places, traffic data, social services and payment services, these services can be provided more effectively with LBS (Driscoll, 2001).

According to Okazaki & Taylor (2008), location based services occur if the new media is suitable for the customer as to their features explained below; for example, topics such as the weather forecast, hotel maps, address retrieval, and the situation of traffic (Barwise and Farley, 2005; Barwise and Strong, 2002; Okazaki, 2004; Pagani, 2004).

According to Okazaki (2004), enhanced technologies such as FeliCa and Bluetooth increase the productivity of GPS technology applications. This enables advertisers to propose real-time offers to subscribers of such services who are in the required proximity. This is also appealing for customers in terms of becoming LBS users (Pagani, 2004). Therefore, companies are provided with extensive means to implement their pull strategies.

The following results have been obtained in the researches performed by In-Stat (Potter, 2007):

  • Present mobile LBS users are corporate subscribers who have a higher income level compared to the average income.
  • The most popular LBS ideas are related with local information and navigational applications.
  • Respondents of the research are technical engineers and students with a high and middle income in the 35-39 and 18-29 age groups, and they are highly interested in the topic.

Such applications cause the development of social networks also lead to the appearance of brand new ideas and persons such as micro-celebrities (well-known and famous people in a certain group or network). This introduces a new expansion to the issue of advertisement presentations (Gade, 2008).

Another finding is that it allows the user to procure the product or service requirement suitable for the self-specific situation of the user and valuable information tailored for the user from the service provider. The service provider uses this information for local presentations and to present advertisements. Besides, the service provider can provide user information to third parties in order to help the presentation of special offers that merge user information and information from other certain applications. So, offers can be customized. It points to e-business models, which are created by social networks that emphasize the advantage of using network information (this information can be demographic, behavioral, or situational or position depended).

According to Batista (2006), created applications draw attention and lead to interesting questions. The interest data of users monitor “micro- celebrities” from the individual user’s perspective and draw attention as to how an individual brings that person to a “micro-celebrity” position. The same type of attention data are also based on which products or services draw the users’ interest. Furthermore, should the “micro-celebrity” be associated with a certain brand and other similar subjects, this is included among these data.

However, the entire approach here is based on only features such as attention-drawing data and accessing, managing, control and owning our data. According to Young (2006), marketers or social network operators (they are the platforms with all the user data) do not fully address to individuals and they are not close to the customer.

Most people are included in a social network and the participation distance when the data is not the network varies according to time and situation. Instead of regarding the social network operators as the only source of user data, marketers should monitor the actual users. Setting up from this view, we can say that an infrastructure to store the individuals’ attention data related with sites, services and platforms is just being developed. However, it is thought that “micro-campaigns” will be more influential at this stage. It is thought that these campaigns would be more effective in the beginning if related data are obtained from wide resources.

LBS Value Chain

Location-based systems encompass service provision in their structures. This type of services creates a brand new value chain where a new one is added to the existing value systems. According to Crocker (2008), those who contribute to the LBS value chain include content developers, application platform sales machinery or software transporters and operators. Content providers provide wide scale data which would reinforce LBS applications. The related content consists of digital maps, weather forecast, real-time traffic, real-time application points, and location brackets. LBS application platforms can be considered as the platforms that provide technologies and infrastructure which enables developing the applications of location based services. In Mobile LBS applications, ready-pack applications that enable special requirements-oriented service delivery can also be mentioned.

Content Providers

Contents such as readily available digital maps or weather forecast services actually express a value on their own. However, the actual value they provide in LBS as mobile content is their integration with other data sources and applications; for example, the integration of mapping and traffic information or the integration of the interested point with search information and navigation applications. Therefore, it is possible to carry out a very strong navigational application. Data, which is created by merging data taken from many different resources, creates a higher value than the user would obtain from the pieces one by one, and creates a kind of synergy.

Many service suppliers, who provide LBS applications, present the content in a similar way to the Internet and other institutional applications. As mobile location based services support the location based services, they are gradually turning into a growing market. Actually, although it is not possible to describe the mobile-content related market as highly-developed at present, the content market has developed with Internet and gained a highly institutional, private and complex form. Such content providers are obliged to act with many partners. These partners are the organizations that collect the data, add value to them and return them to the partner that initiated the action as processed and in the new form.

Some of the special content providers which reinforce LBS are:

  • Digital map providers – these sellers have digital map databases and they license map information for LBS. The leaders of them are Navteq, Tele Atlas and Pharos.
  • Traffic data providers – the providers of these services cluster or filter the traffic data they obtain from various resources and provide them to users via application providers. Inrix and Navteq are the leading providers.
  • Weather forecast data providers – the providers of this service present the weather forecast obtained from a wide geographical area in real time. Weather Bug Accuweather and Intellicast are the leading providers in this respect.

Application Platforms

Application platforms are considered as the platforms where providers introduce intermediary software that interrelates, merges and integrates the two different applications. Application platforms also produce the software on the customer’s side, provide the associated kits (equipment, etc.) and convert them into familiar user interfaces.

Apart from the developed environment, LBS platforms also provide the rendering, fixing location and management of database mapping. Autodesk, deCarta, ESRI, MapInfo and Wavemarket are some of these platforms.

Application Vendors

Application vendors contribute to the management of work flow and processes in this value chain and provide services, and they create a superior value as a result. They provide a serious service although they are mostly considered as small niche structures. The ability to convert such work processes and requirements into mobile software applications is considered as the main competency of these application vendors. Such vendors provide applications such as follow up applications, staff or employee tracking applications, gap filling applications, and relay navigation applications. Networks in Motion (NIM), Gearworks, and TeleNav are among these vendors.

LBS Applications

LBS applications can be considered in three main segments (McGeough, 2002). The leading one of them is the applications provided by public organizations and municipalities especially towards emergency. In the public field, LBS should be considered as emergency evaluation assistance services, location/ direction information services traffic data, social services and payment services (Driscoll, 2001).

From the consumer’s point, applications oriented towards subscribers include child care service, vehicle telematic service, road site assistance, navigation service, tourist visitor service, ground-based invoicing and friend and family finding, and last minute ticket finding. The company and attempts to cover issues such as tracking assets, tracking employees, tracking work order and tracking distribution and supply chain, and fleet management (see Table 1).

Location Based Advertising (LBA)

According to Nysveen et al. (2005), mobile advertising includes wider applications than the ads sent to mobile phones of individuals. It should even be considered wider than the definition of mobile channel. Mobile advertising should be considered as a versatile and interactive network through which various companies, people and organizations could communicate with individuals via various mobile delivery technologies.

LBA should be regarded as rather a subsystem of LBS. According to Bruner II & Kumar (2007), LBA is the presentation of marketer-controlled information at a special and certain point where users can receive the advertising medium. Here, issue location has the most important attribute because the given advertising and the location are connected in a way; for example, being very near to the place of discount or being in the store.

Such advertisements can turn into portable elements if the customer does not like the advertisement or adopt or read it. Because, when the customer is moving, the device is also moving. Therefore, as defended by Oliver, Rust, and Varki (1998), LBA has reached an aspect which would maintain real time marketing. These systems which, for example, have the ability to offer last minute tickets to those who are willing to visit a festival and/or a show, to work in parallel to the Internet, to expand the given service area during which the organization can present the advertisement at the right place, at the right time and to the right person. The cost of such services can be paid by advertisers, or they can even be presented free of charge depending on the adopted technology.

Table 1. LBS applications
Government Business/Enterprises
E-911 Asset Tracking
Emergency Response Enterprise Worker Tracking
Police and Fire Response Work Order Dispatch
Virtual Toll Location-Based CRM
House Arrest Supply Chain Visibility
m-Municipality & Assistance Fleet Management
m-Fingerprint Cargo Tracking
Other Electronic Fencing
  Fraud Detection Services
Consumer Resource Planning
Child Minder Service Real Estate Service
Vehicle Telematics Service Smart Shipping Services
Roadside Assistance Other
Navigation Services  
Tourist Visitor Services  
Location Based Billing  
Friend and Family Finder  
GeoMedicine Services  
Traffic & Dimensions  
Service Finder  
Job Finder  
Parking Place Finder  
Last Minute Ticketing  
Other  

Here, the person may achieve lists that enable taking action, or prefer to answer warnings received from the surroundings.

In this context, the access point becomes a very special point. Kiosks are one of the available access points. According to Rowley and Slack (2005), kiosks tend to be more service-oriented than general purpose work stations (see Table 2). On the other hand, some kiosks provide Internet access and e-mail type of services while others present a limited number of services or realize a limited transaction. Here, the given duty or service acts as an intermediary in delivering the service to the mentioned place; for example, ticket booths at railway stations, or information maps at touristic places.

The mobile advertisements at these points are of a more influential type than the other general advertisements that address to everybody.

Table 2. The kiosk taxonomy (Source: Developed from Rowley, J. & Slack, F, 2005. Towards a Taxonomy of Kiosk Based Self-service Technologies, E- Business Review, Vol.5)
Dimensions
Place User Purpose
Travel
Public Services
Retailers-outlets-shopping malls
Banks and other financial institutions
Entertainment
Catering
General Public field
Passengers
Urban residents
Shoppers
Investors and buyers
Those who want to relax
Those who want to eat
Traffic flow, emergency, etc.
Information

  • High Customization, High Complexity
  • High Customization, Low complexity
  • Low customization, High complexity
  • Low customization, Low complexity

Relation

  • Personal communication
  • Marketing communication
  • Loyalty scheme kiosks.

Operation

  • Goods delivery
  • Digital content delivery
  • Service delivery
  • Remote delivery
  • Ticketing
  • Money transactions

Bluetooth Marketing

Bluetooth is one of the alternative communication channels that has been presented in the world in the domain of mobile marketing dated from 2005 (Patel, 2008) at the time Bluetooth enabled mobile phones release. Bluetooth is a technology which can work everywhere without outdoor or indoor differences, and which can provide great facilities. The technological base of the data received or sent to these mobile instruments may provide distribution in the Bluetooth area with additional technological instruments, and they can be made effective on a secondary level.

Bluetooth enables a regular connection which can be used in the short range environment in order to build a regular connection between the users and their surroundings through wireless technology. According to Buttery and Sago (2004, p.67), Bluetooth is considered more as an independent communication technology than global license by working at a 2.4 GHz ISM (industrial, scientific and medical) band with rapid frequency hopping. Therefore, Bluetooth undertakes a highly evident role in various applications (Buttery & Sago, p.79):

  • Ad hoc networking
  • M-commerce
  • Information services
  • Public wireless information

Bluetooth wireless technology is a short range wireless standard which has been developed for personal connection with an electronic device. The current use of mobile technology is in the structure defined as the fourth version, and it is continuing to develop on issues such as small form factor radio, low energy, low cost, built-in security, robustness, ease of use, and ad hoc network utilization. Almost every business day, five new Bluetooth featured products is launched and approximately 13 million Bluetooth units are loaded to transportation vehicles every week. It is indicated that there are approximately 2 billion

Bluetooth enabled and Bluetooth installed devices in the marke. Actually, mobile technology has completed the features expected from third generation instruments, and third generation devices began to take their places in the global market.

It was not expected to have such a wide scope during the first time Bluetooth’s awareness and acceptance appeared; nevertheless, the result obtained five years after its introduction does not surprise anyone. However, the commercial uptrend of Bluetooth can only be explained with the proliferation of new mobile phones. With these telephones, companies have obtained new ready-made advertising and promotional methods based on technological means with new opportunities of accessing the right customer at the right place and at the right time.

The same activity is realized with certain apparatuses added to the mobile computer. However, the most practical way to perform marketing activities is by using Bluetooth on mobile phones as they have the highest ease of carrying.

As of May 2008, Bluetooth has completed its 10th year of entry into the market. In the researches performed by Millward Brown in 2003 and in the autumn of 2004 on 1300 people between the ages 18 and 70 in the US, UK and Japan, a certain growth is observed in awareness and recognition of the utilization of Bluetooth wireless technology. Awareness has increased from 47% to 77% in the UK, from 43% to 61% in Japan and from 22% to 41% in the USA..

According to the research carried out every year by Millward Brown regarding global awareness on Bluetooth technology, awareness reached the highest of all times with 85% in 2008. Researches for five subsequent years indicate that the ratio is increasing.

Customers in China, Germany, Japan, Taiwan, USA and UK indicated that they heard about Bluetooth technology and they are aware of its logo (68%) and they use devices which have Bluetooth technology. The devices used by these people are:

  • Mobile telephones (79%)
  • Earphones (61%)
  • Computers (56%)

In the research carried out on 2500 people of ages between 18 and 70, at minimum 60% of the respondents in four of the mentioned six countries accept that they have Bluetooth enabled devices. The awareness of Bluetooth technology has been identified as 85% while that for Wireless USB is 57%, for WI-FI (53%), IrDA (53%) and Wimedia UWB (16%). Also, 78% of the customers who expressed that they heard a lot about Bluetooth technology indicated that they would pay more for these products while 57% says that Bluetooth technology facilitates life. Foley (2008) indicates that the technology spread through mobile phones and earphones is currently used in almost every industry.

This technology first came into the agenda to produce wireless earphones in order to use mobile phones as hands free. At present, Bluetooth technology is used on laptops, PDAs, cameras, printers, mobile phones, mouse, keyboards, MP3 players, loudspeakers, automobiles, and medical devices.

Bluetooth which is made ready for systematic communication in marketing, enables contacting a user near a billboard, kiosk, banner, or shop window. When a person who has a mobile phone turns on his or her Bluetooth, a Bluetooth message approval is sent to the mobile phone via servers. A piece of the content such as “From the …. Brand” is sent to the personal mobile phone, and it is requested to be confirmed if the content is accepted. If the user confirms, the Bluetooth Marketing campaign will be directly loaded on the mobile phone and that content will present information (price discounts, special campaigns, product introduction information etc.) about the store near the customer at that moment. Bluetooth does not cause an extra cost as it is a free of charge data transfer method.

The most commonly used mobile content among those sent via Bluetooth is SMS text messages. These messages aim to be influential concerning shopping requests with the inclusion of customer directing information. These messages can distribute short videos, wallpapers, screensavers, text files, java games or mobile phone melodies to customers through a nearby Bluetooth.

For example, in a wide scope study held simultaneously in many countries by Opel, billboards, advertising boards, bus stops and mega boards were used. Customers who desired to download C’MON dolls to their mobile phones and use them as background picture, logo, screen saver or theme saw the text “Turn on your Bluetooth, download C’MON dolls” on the billboard and turned on their Bluetooth devices. In the meantime, when they received the text “YOU HAVE MESSAGE FROM OPEL, ARE YOU ACCEPTING?” they confirmed with a Yes button and downloaded funny contents with various images of C’MONs, the latest commercials and melodies of C’MONs to their mobile phones in front of a billboard.

Customers are gradually becoming aware of such technologies and they develop the ability to use this type of technologies when they want which has pushed forward the idea of producing new approaches in order to develop the ability to address the conscious customer both for the telephone set manufacturers and for the marketers. They are trying to use this technology on their products in order to create differentiation and increase profit margins. The experts indicated that actually the cost of installing a Bluetooth chip to a mobile phone is not very low, and they have begun to act with the strategy of expanding their areas of use by adding them into many products. Even added on motorcycle helmets, sunglasses, gaming controls and some fitness equipment, Bluetooth signals its future use in new application areas like home entertainment and fitness devices.

All previously-mentioned applications such as SMS and MMS, which are included in mobile systems, are realized by connecting to a customer’s mobile phone via an operator network. Wireless technologies such as Bluetooth and wireless create an alternative to the mentioned general structure and allow for benefitting from the media with free of charge applications. For example, in the operations performed with a users’ telephone number (such as GPRS and SMS), the usual applications consider point targets while they are away from the right place and right time concepts. With alternative connections through Bluetooth, campaigns can be made more mass-specific.

These campaigns are the permission-based transfers although they are transmitted to the customer’s phone from transmitters installed at privately-owned broadcasting organizations and areas at fixed locations, and they are based on on-demand communication. For example, a supermarket may inform its campaigns or informative messages about service sections to all mobile phone users that enter the supermarket or that are in the close vicinity via a Bluetooth campaign instead of sending an SMS which would be costly or the people around an entertainment center can be informed about the program of the day or night through creatively-thought invitation files. As these messages are opt-in, they will be monitored by only the users who are willing to see them, and they will not create “message pollution” or “spam” on the mobiles of those who do not want to receive them.

Bluetooth advertising is strong because:

  • It reaches on the spot and on time.
  • It provides high-quality relationship building and long-time saved advertising. The customer accepts the message when the advertisement message is delivered to the customer, but the customer can watch it anywhere and any time he or she prefers.
  • Having introduced a new advertising approach, Bluetooth enables the customer to reach the advertisement and explore the product or service at the closest point.
  • It has high inducement value as it promotes a place or as it is acquired at a close point to the source. For example, receiving hotel advertisements at airports or beer advertisements at bars can be infuential in making a selection.
  • It has the ability to increase sales point activity and to provide interactive information for all possibilities the customer may ask for.
  • It allows making promotion campaigns with promotional content distribution.
  • It allows for beneftting from a free of charge communication service and reduces the cost of marketing campaigns.
  • It is a more effective approach than conventional marketing in terms of reaching the customer faster.
  • In foreign countries, the issues such as fnding a destination, road, description are rapidly clarifed and the person can act easily according to the provided information although he or she does not know the local language.

As Bluetooth is a free of charge way of data transmission, it is suitable for developing a very low cost marketing activity. It is a very simple and easy to use technology which can work and which can be applied everywhere regardless if it is indoors or outdoors; furthermore, it can be enabled with a small mechanism and work in parallel to a media that helps convey the message. Bluetooth can add advertising value to billboards, kiosks and posters. A person can enable Bluetooth function anytime and follow the received messages, and become interested in the content of the message received. At the moment the message is approved by the user and when Bluetooth begins to direct shopping behavior, the Bluetooth marketing campaign reaches its first goal. The interest paid to Bluetooth can later be maintained with other mobile content such as SMS, downloadable short videos, wall papers, screen savers, text files, java games or mobile phone melodies, and other downloadable elements of sports, music, lifestyle and dining.

Places to Use Bluetooth Marketing

Bluetooth marketing can be included in activities with a rather social content such as concerts, fairs, festivals, sports contests, museums and archeological excavation areas for individuals who create society. They can also be used at rapid circulation points such as bus stops, railway stations, and airports. During activities at such places, Bluetooth can be used as an effective instrument to present the video of the activity, the video or commercial of the sponsor, the music or melodies related with the activity, the wallpaper of the organization, the screen saver which shows the activity logo, the promotion and marketing of future activities, the map and place information of the area and information in a fair.

Bluetooth marketing allows for communicating detailed information and prices of the products sold on site, the introductory files of sponsors, and virtual business cards. During sight-seeing, the option to select the language for the explanation of historical places can be provided, thus the selected audiovisual explanation videos, the means of transportation, the times of tours and information of other nearby historical places as well as other special information such as museums or art galleries, and a download of a map of the museums can be offered. Also, at places such as exhibitions and expositions, the introductory videos of artists whose works are exhibited, audio-visual videos of the works, and the introduction of the next program can also be presented. Similar introductions of musicals or concerts, maps and drawings, melodies, video clips and songs of the artists, questionnaires or contests about the artists, desktop background and screen savers may also be effectively used. In sports games, the goals of the supported team, the anthem and songs of the club, and many other meaningful elements for the user can turn into subjects of Bluetooth marketing.

Table 3. Some Bluetooth utilization points and presented promotions
Place Promotions
Airport 1.Flight information
2. Information about the city
4. Free Shop discount coupons
5. City-wide and/or inter-city transportation routes and information
6. Restaurants and sightseeing information
7.Other
Cafe, Bar and Restaurant 1. Visual presentations of special menus
2. Description of special activities
3. Reservation for next visit via Bluetooth
4. Invitation of the potential customers in front of the door with continuous discounts and gift coupons
5. Increase of appeal of consumption with discounts and gift coupons presented to the customers inside
6. Food/beverage gift coupons
7. Other
Entertainment centers /Cinemas 1. Trailers of current movies
2. Food/beverage gift coupons
3. Show time
4. Next opening shows
5. Wall papers and screen savers of movies
6. Last minute special discounts or discount coupons which allow sales of tickets in a very short time
7. Other
Hotels 1. Hotel introduction and information
2. Local access information
3. Password transfer for wireless internet access
4. Order via Bluetooth from room
5. Delivery of information on activities of hotel
6. Certain touristic information
7. Food beverage coupons
8. Other
Kiosks, Stores, Shopping Malls 1. New products, bar codes, customer loyalty programs
2. Brand introductions
3. Gift checks and multimedia contents
4. Where is it? Information
5. Advergaming
6. Special last minute sales discounts and other discount information
7. Lotteries
8. Other
Stadiums 1. Anthem and songs of the supported team.
2. Statistics and match schedules
3. Small movies with pictures of players or goals of the supported team
4. Next activity schedule
5. Concert or match details
6. Map showing place
7. Other

Provision of planned and detailed access to not-easily-accessible information such as statistics and match schedules also help individuals to focus their interests on these issues. This creates an impact that goes beyond an existing mass, and allows every interested and curious individual to be included in the subject.

With Bluetooth technology, which is now available on almost all mobile handheld devices in the market, communication can be established between two instruments in order to transfer data and files. The distance between the device and the Bluetooth broadcaster can vary between 10 and 100 meters, depending on equipment features of the communication devices and the environment.

Advertising content or aimed multimedia files presented via Bluetooth are instruments such as pictures, music, video, and text, and it refers to the eye and ear, but additionally it also requires using the sense of touch as it is downloaded. This actually means benefitting from multi-perception having a high possibility of influence. Also, a customer can be directly addressed in the multi-tasking structure. It allows for the delivery of discount coupons, ringtones, movie trailers, mobile games with advertisement content, mp3 and an advertising network centrally directed to mobile device users (mobile phone, PDA, SmartPhone, etc.). Different system projects will gradually be developed. Mainly, three elements are dominant in system projects: Bluetooth Server, Advertising Management Server and Web Panel.

  1. Bluetooth Server: It is the sub-system that allows for the delivery of related multimedia advertising files to the end user’s -Bluetooth supported- mobile device. These servers constitute the nodes of the advertisement network system distributed to places where the end user spends much time such as shopping malls, mass transportation stations (subway, airport, etc.), and cinemas. They are the structures with high memories and generally run on Linux base. For example, the system used by Mopromo is a Bluetooth equipment integrated 200 MHz processor with a 128MB cache memory with 180x180x100 mm dimensions known as the Linux embedded system. Bluetooth servers work as connected to the Internet in a way (LAN, WAN, Wi-Fi, GPRS etc.) in the located place, so the content of the Bluetooth server can be changed from the center.
  2. Advertising Management Server: It is used as a sub-system developed in order to manage the Bluetooth servers of the system. Client-server architecture is established between the advertising management server and Bluetooth servers. For example, the advertising server processing the advertising campaign uploads via a Web Panel and sends the advertising files to related Bluetooth servers, and processes the information received from Bluetooth servers (the download statistics, etc. or information which show the performance of the advertising campaign) then transfers them to the Web panel.
  3. Web Panel: This is a sub-system that allows advertisers to subscribe in the system and directly conduct their own advertising campaigns. Advertisers can log into the system via a promotion web site and benefit from a publisher who can upload the related multimedia file to the system, and publish them via Bluetooth servers configured at the places where targeted customers are densely located. In the latter versions of these systems, the end-user can be provided with an analysis performed with data-mining algorithms. They can provide information of “the locations where related advertisement could be more successful if it is broadcasted” by basing it on the obtained data. So, the requirement for questionnaires, face to face interviews and customer satisfaction or customer information acquisition-related efforts would decrease.

This system does not bring any costs to the end user because the files are sent via Bluetooth free of charge. Accordingly, the user would not need any software/hardware support. The integration of this system in Near Field Communication (NFC) in order to develop a network structure where the user would make a direct payment can be considered. Hence, advertisers who use the system would not only promote their own products or services, but also have the opportunity to sell their products and services and receive payment via the system.

Through the subscriptions of individuals who are included in the conventional customer portfolio mobile device users can indicate and include their own preferences in the system via portal, stating the advertisements and discount opportunities on issues they would be interested in. It allows advertisers to reach customers that they are directly targeting, and also the inclusion of new or fresh users of Bluetooth to be included in the system. So, realizing a brand new application that allows reaching the directly-targeted customer is possible.

The leading questions that come into mind about the system are the security and reliability issues. It is thought-provoking that a virus can be sent to a mobile phone when Bluetooth is on by taking advantage of certain gaps in the Bluetooth protocol. If the end user attempts to open a virus file “only by looking at its name” without knowing where it came from, then he or she may activate the virus. New mobile applications are being developed in order to eliminate this problem. Also, the user may be informed that the file is sent from the network of a promoted company and therefore, it is a trusted file. Also with mobile application, the user of the mobile device can enter the system, browse the content of the Bluetooth server and download the file to the phone rather than wait for the file to be sent to the user. Furthermore, a bi-directional communication opportunity is also created when they download the mobile application. Besides, mobile device users can be warned on the website about activating the Bluetooth function of their mobile devices near the locations of promoting Bluetooth service and turn off the function after receiving the files. Also, continuous communication can be established with the mobile phone which downloads just once.

One of the weak points of Bluetooth is the narrowness of the covered area and customer. Operating in a 15-30 m. diameter area may both be considered as a weakness and as an advantage. In a selected coverage area, the potential customer is very near the promoted product and has a higher chance to evaluate the promotions and given information compared to normal conditions. There is no roaming. If the receiver is active, the advertisement presented to the receiver who exits the coverage area is cut off. If the files are big, then the download period increases and the download may be interrupted while moving. This may help to keep the customer in the vicinity or frequently attract the customer to that point or area.

Also, as 3G telephones provide video-calls, solving many problems arising from the remote manager and employee and from the proximity of the activation of providing devices will be possible via video-phones.

The systems which first began with infrared transfer technique which could be converted into a different system later adopted the Bluetooth technique, and they have enabled the utilization of an interactive advertising and promotion network quite different from the conventional mass advertising and promotional approach. The receipt of advertisements and promotions on the mobile phone as permitted turns the push concepts of the force and aggressiveness of SMS marketing into pull with Bluetooth Marketing. The influence of promotion is high as the customer is very near the purchasing or service place. Push is a method used by a company to send informative messages to people in the permitted database. That is, the company provides people included in the database with promotion, place, ticket features, type of information upon their requests, and creates a pressure for buying those products or services. The customer can act anytime when he or she thinks that the pressure is a suitable option for him or her. In the foregoing structure, push can be considered as force to open Bluetooth to activate the customer. Pull is considered as the communication of a campaign to the consumer through a classical media (TV, magazine, outdoor, internet etc.) or Bluetooth, and the consumer’s response upon its receipt. For example, the activities which include sending a keyword to a short number in order to participate in a lottery or to win a gift are considered in pull marketing. Bluetooth can be used as both push and pull.

Bluetooth is an effective marketing tool within its coverage area. Therefore, proximity appears as the most important factor. However, the statement that proximity influences shopping will be better understood with measurements and evaluations after the system is densely used. In addition to being a solution that includes and carries forward concepts such as e-commerce, it is also possible to use the social environments of users of the system during advertisements and promotions. This approach which has emerged as a new approach based on creating influence in the close vicinity may also change the buying behavior of the customer in time. In the mean time, marketing activities in continuous contact with an individual should be considered as new opportunities of benefit in the social environment.

Here, the feature of creating a social network or bringing together individuals who are in the same region and who have the potential to communicate with each other creates an important difference.

In the activities to be realized via Bluetooth, a campaign can also be supported with visual elements. These are billboards at the entrances of shopping centers, or promotions such as local posters or leaflets. They describe the product or service and promise various “digital gifts”, discounts, promotion, coupons, sweepstake or descriptions which can mean material benefits for the customer. Every activity to be held in order to lead those who are not included in the system to activate their Bluetooth devices should be realized with the perspective that one customer means one thousand customers.