Soon to your AT&T cell phone: 'Free kibble in Aisle 6'

Mobile marketing with location technology launches in mid-March in four cities

AT&T customers in four U.S. cities will soon be able to receive mobile coupon alerts and other marketing information from nearby stores, based on cellular location technology.

In mid-March, AT&T will begin providing text (SMS) and multimedia (MMS) alerts, retail coupons and rewards to the smartphones and cell phones of AT&T customers when they are near a participating store, based on geo-location data provided from nearby cell towers, the carrier announced Monday.

The service, called ShopAlerts by AT&T, is set to launch in New York, Los Angeles, Chicago and San Francisco. AT&T will be the first U.S. wireless carrier to offer such a large-scale mobile marketing campaign based on location technology.

Customers in the AT&T program can expect to receive SMS and MMS offers from a host of initial ShopAlerts sponsors, including Hewlett-Packard, Kmart, JetBlue, SC Johnson, Kibbles 'n Bits, Nature's Recipe and the National Milk Mustache "Got Milk?" campaign.

The offers could be a coupon or reward, or an alert of some kind, AT&T said. The offers could be enhanced with information on weather, traffic and the local shopping area.

AT&T will not use GPS data to pinpoint a user's location; rather, it will rely on nearby cell towers to create a geo-fence (a virtual perimeter) around a store, event or area of shops and restaurants to deliver location-specific messages, a spokesman said.

Such services have been envisioned for years but have been slow to catch on at a large scale in the U.S. for various reasons, including customer acceptance and the sheer network logistics involved.

Since customers must opt in to be part of the program, AT&T might not hear many of the concerns over location privacy that have haunted other services involving geo-mapping and GPS. For example, some consumer groups, especially in Europe, have attacked Google over its Google Maps Street View technology, which is used to show panoramic photos of streets, houses and buildings when users zoom in on satellite maps from a computer.

One analyst, Jack Gold of J.Gold Associates, said he expects some customers will want the retail alerts and will opt in if the offers are worthwhile. But the service could also become annoying, he noted.

"Imagine being signed up and driving down the street and having your phone buzz you every two blocks," he said. "I think this may be a hard sell for many users who are already inundated with too much stuff coming at them from Facebook, texts etc. Unless it offers real value, I think most consumers will just opt out."

However, AT&T cited officials from Kmart, JetBlue and HP who praised the concept. Katie Thompson, associate director of digital media at JetBlue, said one advantage in having AT&T maintain the opt-in database for ShopAlerts is that JetBlue won't have to.

Placecast of San Francisco will provide the location technology to AT&T. Opt-in, location-based mobile marketing works because advertisers offer "relevant messages to consumers when they are in the mindset to make a purchase," said Alistair Goodman, CEO of Placecast, in a statement.

AT&T would not say how many customers are projected to opt in for the service, but a spokesman said the numbers would be "significant" in each of the four cities. In addition to being beneficial to consumers, the service will benefit the brand sponsors, which can expect to see a rise in store traffic and sales, as well as an increase in "brand favorability."

Customers can opt in on AT&T's Web site.

Matt Hamblen covers mobile and wireless, smartphones and other handhelds, and wireless networking for Computerworld. Follow Matt on Twitter at @matthamblen or subscribe to Matt's RSS feed. His e-mail address is mhamblen@computerworld.com.

Copyright © 2011 IDG Communications, Inc.

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