Near Field Communication: The future of mobile payment solutions!

With so many advances being made today concerning the nature of commerce and how it has been conducted electronically over the past decade, one cannot ignore, but be aware of the ground being covered by smartphones and their capability to facilitate mobile payments. The technology that has enabled the likes of Starbucks and MasterCard to familiarize customers with this convenient form of payment is known as NFC (Near Field Communication). It is a form of “contactless” exchange of information via radio frequency identification transponder (RFID). Although some businesses have used forms of mobile payments in the past, the setback is that they have been unique to their establishment as for instance the Starbucks mobile payment application.  NFC however, strives to create an industry-wide standard that can be used at any type of store. In order for NFC to be mainstream, devices (with smartphones being the preferred choice according to MasterCard) will be equipped with an NFC chip and also POS (Point-of-Sale) equipments/readers. With your bank account details synchronized to your smartphone, you can easily make a transaction. So a typical transaction can be placed simply by holding up your smartphone to the reader and immediately, funds will be transferred from your account to that of the merchant’s. For security purposes, a pin will have to be keyed in to curb unauthorized transactions. 

It costs $2 to manufacture an NFC chip and can be practically attached to almost anything (MasterCard experimented with bags, watches, and even keys!) Google in conjunction with Samsung recently launched an NFC capable phone in the US last December 2010 known as the Samsung Google Nexus S. Amongst being a convenient and fast form of mobile payment, NFC capable phones can also aid businesses in promoting their services or products. For instance, a small restaurant business can transfer discount vouchers to customers so as to command greater patronage. You do not have to walk in with a coupon next time, it’s already stored securely on your phone. An application is out now called Enable Table that only run on NFC capable phones that will allow businesses to enjoy this benefit. Imagine the dollar savings from having not to print coupons and distribute flyers. In today’s digital world, I see a lot of prospects for even big businesses.

Even still with Google, Samsung, MasterCard, Apple and major giant corporations spearheading NFC campaigns, people still doubt, questioning the security of this technology. Experiments are underway in Japan to begin testing the NFC technology. I bet the same people had reservations when the idea of carrying money on a plastic card got introduced. Today, debit/credit cards are accepted almost everywhere and around the world. If you still think this is rocket science, trust me you will be left out. The Starbucks’ mobile payment application is going to be viral and other businesses will be inclined to follow suit, paving the way for an industry standard NFC mobile payment solution. If you are very concerned about using forms of mobile payments, the Better Business Bureau has put together tips that can help in adopting this type of technology advancement. Time’s changing and so is technology and e-commerce!

Videos showing capabilities of NFC

NFC transaction

A video of Enable Table 

A video of Taglet

Music piracy: The Internet's curse and gift!

Music piracy has been an alarming topic of discussion within the music industry in the last decade. With the Internet being more readily available all over the world, the majority of the music distribution online has been conducted illegally. In the US alone, $12.5 billion is lost annually to music piracy as reported by the RIAA. Today, mega star recording artistes and giant labels oppose music piracy because of the losses they stand to bear. Prior to the existence of the popular mp3 music format, these record labels and artistes enjoyed longevity and outstanding record sales at the cost of the consumer. I remember Eminem, as early as 2001, selling as much as 9 million records for his album “The Marshall Mathers LP”. Back then, digital music had not gained popularity so I was obliged like everyone else to go purchase the entire album even though I only liked about a handful of tracks from it. Fast forward today, consumers have reacted differently to the way music is commercialized. The same Eminem, over the course of the years of the notoriety of the mp3 format and its distribution over the internet, has struggled with mediocre sales with “Recovery” being his most successful album since 2002’s “The Eminem Show”. In my own honest opinion, if I am not able to listen to the entire track of the album, I am not buying it. In today’s world, people who purchase music are the same people who were able to download it for free. Before the release of an anticipated album, what do most people do? They google the title to see if there are any leaked tracks floating the Internet. Once they find the entire album, they listen and rate. If they are hardcore loyal fans, on the release day, they go out and purchase the album. If the album was worth the download, the same individuals, through appreciation for the contents of the album will purchase a legal version once it has been officially released. On the other hand, recording music artistes like Sean Kingston and DubFX have used the Internet and its distribution channels as a means to gain popularity and attain record deals. 

I am not condoning illegal distribution of music, but it is what the highly lucrative music industry decades ago did not anticipate. Now, there are means initiated by agencies protecting music and business partners to control the online distribution of music content as mentioned here. Effective models have been categorized under download/subscription and streaming. Examples of the download/subscription services are Nokia's Come With Music, Google's Music Link Service, an TDC's PLAY service. Streaming services such as Myspace Music, Spotify, Lala have helped in promoting artistes and identifying music tastes and generating additional revenue like concert ticket sales.

Even with legislation and policies set in place, I still believe that consumers and even emerging artistes will rely on the internet as sources of retrieving and distributing music; legally or illegally. 

Somewhere out there is hope for businesses; both large and small!

Business is not booming; well, not for everyone like it used to do because of the downwind spiral direction the economy has been heading. Layoffs, steeper borrowing rates, and stagnant unemployment rates across the nation have all been outcomes of the recession. Purchasing power of the consumer has been impaired. Thus, consumer spending has been retracted. Businesses have gone belly up; those still existing need to cover their fixed and variable costs. They still compete to gain customers patronage and will do so at any extent (capitalism is great!). Now thanks to the incredible concept of Groupon businesses can utilize the power of social media to promote their services or products.

The way Groupon works is that companies enlist services or items on the site that will be subject to a discount (coupon) if and only if a quota—the minimum number of interested individuals as desired by the company—is met. Consumers who are aware of this discount and sign up will be able to “re-promote” this coupon to other consumers like friends or families through the use of available social media tools like facebook, twitter, or digg. Once the minimum number of people signup, the discount is then validated and the offer stands. The collective bargaining idea of groupon is wonderful and can be very beneficial to a company. This idea is brilliant and I often relate it to that of the bidding site that charges consumers for bids and allows them to win auctions for items with relatively high MSRP prices for unbelievable prices. Click here to buy consumer electronics for dirt cheap! It is highly legit and scam-free!

Surprisingly, not all deals that are offered through groupon’s site generate profits for the businesses. According to this article, small businesses can gain exposure from it as they are featured and individuals help “re-promote”, but only about two-thirds redeem profits. Consumers who are sensitive to price, given the economy of today, only participate to cease the deals and do not end up being repeat customers. In my own honest and personal opinion, I feel these small businesses should capitalize on using groupon as only an initial means on exposing their businesses and should increase awareness through additional tools of online social media. See my previous blog entry on running a successful social media campaign.  

Would you say Groupon’s approach is insufficient and should offer more? Or the businesses just bank too heavily on groupon’s model? Should they enlist on other groupon-like sites to better their chances of making a sale and offer more discounts? How much of a discount can they even afford to give?...And how frequent?

This is capitalism at its best; cut throat competition. The consumers ultimately make the final decision—to buy or not to buy.  Remember to shop wisely my friends and get more bang for your buck!

You think you know social media, well think twice!

I know social media; so do you and the individual you are apparently six degrees separated from.  In this modern era, it is safe to say a majority of us who have access to the Internet are participants of social media. Social media even has a role to play in the way businesses are conducted-they can affect your business strategy. If you are thinking of employing the help of currently unemployed “techy” Joe across the street from you to apply social media to your business, you will be doing so irrationally. My friend, the news is that you are one of the many misinformed people and have become a victim of one of these six myths as according to this article:

1. Social media is cheap, if not free. The concept that social media is totally free is false. The real deal is that it is cheap from a marketing perspective compared to the traditional forms of advertising. You can doubt this and utter “...but Facebook, Twitter, Youtube Flickr, StumbleUpon, etc are all free; I can promote whatever I feel like without a cost.” Yes you’re absolutely right, as these are the tools available for free to socialize. However, to run an effective social media marketing campaign for your business will require a lot of time. And time is money. On the average, it will cost you about $50,000 to implement a two-three month campaign. Some businesses can spend more or less. The best practice to approach social media marketing is to create a simple microsite that will be the hub of your business’ online community and can provide links to the facebook, youtube, or twitter groups created to help distribute the content. Depending on the level of interaction desired for potential customers and existing ones, this task can be exhaustive. Implementing social media interactivity requires skills in programming and in developing some complex functions like creation of e-commerce and user-generated content. Skill, experience, and time will be additional costs incurred. Be prepared to budget around $50,000 to $100,000 for a full-fledged interactive microsite. Toss in additional tools like Google’s AdWords to generate traffic to your site and you pay more.

2. Anyone can do it. In fact, people claim to have in-depth knowledge of social media and wrongfully refer to their expertise using misleading titles. From a simple twitter index of a group of people following renowned blogger Rober Scoble, there are claims of: 4273 internet marketers; 1652 social media marketers; 513 social media consultants; 272 social media strategists; 180 social media experts; 98 social media gurus; and 58 internet marketing gurus. Now I wonder how many of these self-proclaimed whiz kids have success stories or even real campaigns. I can blog. I know how to update statuses on facebook. I can tweet, follow and retweet comments. I’m pretty good at uploading pictures online and I understand geotagging as well. And yet I have no expertise in marketing, advertising, or public relations. Just because we all can utilize social media tools does not mean we can successfully run a campaign for a business. Mere opinions or theories are not substitutes for experience. 10-plus years of online marketing incorporating user-generated content, blogging, posting on forums, and interactivity are qualifications worthy of such glorified titles. Now tell me how many of the 7046 twitter users above following Robert Scoble can make such claims?

3. You can make a big splash in a short time. It is misleading to discover that once a marketing campaign has been taken enlisted through the tools of social networking it immediately becomes poplar. This myth is proven to be longer than the average social media marketer believes. In expressing this point, people who use social media have a longstanding use of tools like twitter. Take for example Ochman’s newly launched business, pawfun.com which sells customized t-shirts. As an avid social media user, Ochman was able to direct more traffic than he would have ever imagined through his 7 plus years of blogging and his 4000 followers on his twitter account and an additional 120,000 readers of his blog.  Also, Zappos.com CEO, Tony Hsieh, was able to build a huge number of followers and shoe enthusiasts through his Twitter account. He has over 32,000 followers. Also, Melanie Notkin, owner of Savvy Auntie was able to successfully use Twitter to help find investors, suppliers, and products for her community of godmothers, aunts, and “other women who love kids”. Traffic generation was of importance to her, and did so accordingly years before her business was fully incorporated. Social media will favor any business idea that people find unique or interesting, but the key thing to remember is that it cannot happen overnight.

4. You can do it all in-house. Doing it in house is tougher than one might expect as there are certain essentials needed to perform a successful social media marketing campaign. Resources needed are contacts, tools, strategies, and a lot of experience. In-house personnel, often try to reinvent the wheel or apply the wrong tools in certain instances. It is also rare to see an in-house staff with all the possible combination of those resources. Activities that implement blogger outreach, blog advertising, Google ads, and so on should be left to experts. Hence, it is recommended to outsource your social media campaign attempts.

5. If you do something great, people will find it. This assumption is a false as it gets. You need to raise awareness in order to get recognition for a well-structured social media marketing campaign. Using tools like Twitter, Digg, and StumbleUpon to drive traffic and create buzz about your new social media campaign is the goal. In essence, your social media marketing campaign has to serve its purpose—spreading the word through the provision of adequate information through multiple sources.

6. You can’t measure social media marketing results. Non-experts would assume that the results attained from the efforts of social media marketing are non quantifiable. This is notion is wrong, as there are instruments, web based, that provide statistics on how well a microsite, for instance or blog is performing over a period of time. One can refer to Google trends, twitter search, Google analytics, backtype or even compete to provide such data.

Remember, there are a growing number of self-proclaimed social media marketers, but only a few experts really exist in this field and are not victims of these six social media myths.