Our last Assignment in Week 1 of Mobile Advertising and Design was to answer this question:

“In what ways do you feel that companies are using mobile technologies to target you regarding their products and services?”

A great article on this subject is in the New York Times.  Written by Stephanie Clifford, it was published on April 16, 2010 and is titled “Web Coupons Know Lots About You, and They Tell” [http://www.nytimes.com/2010/04/17/business/media/17coupon.html].

Companies who use mobile advertising target potential customers by:

• Geographical information contained in the phone
• Interests
• Specific Social Media Pages (YouTube, Facebook, Twitter, etc) that can also bleed Sex (M/F), Age and other “private” information
• Search queries
• The customer’s IP Address

All of this is invisible to the customer.  It’s not ‘general’ information either.  These coupons can get eerily specific, virtually following you to bed where it knows what kind of sheets you have!

These merchandisers use a company called RevTraxx who has no privacy policy.  They get around the privacy policies of Google and can even trend your IP address – if you have a proclivity for downloading pizza coupons on Friday afternoons – you may soon find one already there!

In a worst case scenario, as the article points out, companies with this kind of personal information can offer you substandard products than they might offer another person; or the same product but at a higher price than the next person.

Privacy advocates are very much alarmed by this activity and the article quotes Ed Mierzwinski, the Consumer program Director for USPIRG as saying “There really have been no rules set up for this ecosystem”.  Now, USPIRG is asking the FTC to tighten up online advertising privacy rules.

Kwedit is currently only for digital goods, however, their partnership with 7-11 Stores will create a new payment method that changes the landscape of online sales, especially using Kwedit Direct!

In the New York Times article “Buy Now, Pay Later (Maybe with your allowance), Kwedit bring online purchasing to the under-13 crowd, as well as a tipping point to add new buyer personas to e-commerce.

Currently, Kewdit is being used strictly for digital goods in children’s games, where they can make purchases of digital goods in the game using a promise to pay.  As they do pay for the goods, their “kwedit” score goes  up, allowing them to purchase more on a promise.  Kwedit is reportedly seeking the “sweet spot” where the kewdit limit is not too high, but not low enough to discourage the purchases.  At the same time, the digital goods sellers suffer no real loss for non-payment (except obviously their time in creating them).

The cooler part of this new platform is the potential in the future availability to add “Kwedit Direct” as a payment form for all other online transactions.  According to the New York Times article, the buyer will be able to make a purchase online using the Kwedit account, then print out a bar code and take it to 7-11 to make a payment in person using their cash, or their credit or debit card.

This potentially increases online sales to those who have avoided buying online because they do not want to expose their bank account, credit or debit cards – or they simply do not have one.

This is an exciting opportunity for online merchants and worth watching as it rolls out!