INSIDE MOBILE: Mobile Marketing Using Camera Phone 2D Bar Code Scanning

The CTIA recently asked me to moderate a very interesting panel session on Camera Phone 2D (two-dimensional) Bar Code Scanning. The session was held at CTIA Wireless 2008 on April 1 in Las Vegas.

You might think this would be a rather mundane subject, but I can assure you that Camera Phone 2D Bar Code Scanning is an exciting and important new addition to the mobile marketing category. Camera phones and mobile marketing may sound like an oxymoron but, by the time you finish reading this column, you’ll understand why it’s an exciting new area in mobile marketing.

The panel consisted of Jonathan Buckley, CEO of Scanbuy; Chris Dury, vice president of ScanR; Dudley Fitzpatrick, CEO of Jagtag; William "Chip" Hofman, CEO of NeoMedia Technologies; David Miller, CEO of Mobile Discovery; and Brian Stankiewicz, director of Corporate Strategy at Alltel.

This panel was concerned with how to process a digital photo of a special 2D (two-dimensional) bar code that is embedded in a poster, magazine ad or billboard which is promoting a product or service. The image is decoded on the phone, and then transmitted to a server in the wireless operator network. This, in turn, returns information to the user--typically in the form of a coupon, special content or other reply to the ad’s offer. Thus, while this panel session initially appeared to be about the technology of scanning bar codes with cameras in mobile phones, it instead turned out to be an interesting session about mobile marketing.

Why Camera Phone 2D Bar Code Scanning?

Here’s the primary thesis of this new arena within mobile marketing: taking a digital image of a bar code using the camera in a phone takes less time than responding to an ad by typing a short code plus the response text. Most people already know how to respond to a short code (text “vote” to “5705”), like what’s used to vote in the “American Idol” television show.  

However, taking photos in a digital camera is a different and relatively new experience. It requires users to know how to take a photo with their mobile phone and then send the captured photo to a destination, typically via MMS (Multimedia Messaging Service). A number of people feel that it’s best to integrate this experience into a single application that is downloaded to the phone.

Each panelist provided a short presentation on their views of the market. To be fair, SnapTell (not on the panel) should have been on the panel since they are doing scan-to-buy/respond, whereas ScanR (on the panel) should not have been on the panel since they have applications that use the phone’s images to provide personal services such as converting a scanned image of a document into a remote fax or scanning a business card to generate a vCard image that would, in turn, be imported to the Contacts in an e-mail program. I know and like the folks at ScanR; it’s just that they are not a mobile marketing company and, hence, it would have been more appropriate to have had SnapTell on the panel.

Wireless Operators and Advertisers Working Together

It was good to have Brian Stankiewicz from Alltel on the panel because he provided added insight and perspective of the wireless operator. From his point of view, wireless operators are working with major brands and advertisers to implement technologies so that a camera phone image can be easily transmitted via MMS. He felt that all operators will be working with major brands and advertisers for promotions using 2D bar code images as the response method over the next few years.

1D (one-dimensional) bar codes, such as those used in the grocery store to identify products, cannot be successfully read with most of today’s mobile phone digital cameras. These cameras don’t have the necessary macro-focusing capability to take close-up images and convert them into the UPC (Universal Product Code). 

Most of the panelists feel it will still be a couple of years before cameras in phones will have the necessary capabilities to read a 1D code. And, even when future camera phones can read a 1D code, there is a question of what information should be sent back to the user when the code is scanned and sent to the wireless operator. With the current campaigns and 2D codes, the binding of the code to the response is defined by the promotion and the demographics of the user.

Biggest Issue - Lack of Standards

The biggest issue expressed by the panelists is the current lack of standards in the format of 2D codes. The 2D codes can provide an image that can be easily deciphered by the server in the operator’s network. Most of the panelists believe that standards will develop over time for the 2D codes.

One of the interesting things that can be done with the 2D code image is to link it up with the user’s demographics and then provide personalized feedback. Take the example of an ad for a car manufacturer such as BMW. Each user would take one image of the 2D code and send it to the wireless operator for processing by the marketing company doing the promotion. But each user might get a different image of a car that is based on their own personal demographic information available from the wireless operator (age, occupation, sex, etc). The panelists all agreed that all camera phones should be able to read any 2D code.

Most of the firms provide a client that is loaded on the phone. The application then scans the image and sends it to the company’s server for processing. This allows millions of products (such as a can of soda or a bottle of water) to become the advertising medium where responses can include things such as coupons, music, ring tones and other valuable digital content--as well as video clips about the item. For example, a code on a can of soda could result in the user getting a discount coupon on their next purchase, or a music video that they would watch on their handset. SnapTell approaches this slightly differently: They scan regular ads and scenes, and then do image analysis to create the appropriate response.

In summary

It appears to me that 2D codes with camera phone, scanning and ad fulfillment will become a viable advertising consideration. There are many ways to do marketing in phones from SMS short codes, display advertising, sponsorships and games. Some people will prefer the simple “point and click” process of using a camera phone, while others will prefer to use a short code. 

I suspect that advertisers and brands will experiment and try different programs to see which generate the highest response. Some advertisers will utilize multiple mobile technologies in the same ad; for example, including both a 2D image and a short code and letting the user choose in which way they most prefer to respond. 

 J. Gerry Purdy, Ph.D., is the VP and Chief Analyst with the Frost & Sullivan North American Information & Communication Technologies Practice. As a nationally recognized industry authority, he focuses on monitoring and analyzing emerging trends, technologies and market behavior in the mobile computing and wireless data communications industry in North America.

Since joining Frost & Sullivan in 2006, Dr. Purdy has been specializing in mobile and wireless devices, wireless data communications and connection to the infrastructure that powers the data in the wireless handheld. He is author of Inside Mobile & Wireless, which provides industry insights and reaches over 100,000 readers per month.

For more than 16 years, Dr. Purdy has been consulting, speaking, researching, networking, writing and developing state-of-the-art concepts that challenge people's mind-sets, and developing new ways of thinking and forecasting in the mobile computing and wireless data arenas. Often quoted, his ideas and opinions are followed closely by thought leaders in the mobile & wireless industry. He has a Ph.D. in Computer Science from Stanford University. He can be reached at gerry.purdy@frost.com.

Disclosure Statement: From time to time, I may have a direct or indirect equity position in a company that is mentioned in this column. If that situation happens, then I’ll disclose it at that time.