Mobile 2D barcode scanning is paving the way for a range of exciting and lucrative schemes hyperlinking our physical world of things (all objects including product packaging, printed media, TV, billboards, equipment – the works!) with a digital world or websites and destinations filled with information, advertising, applications downloads, coupons, processes and special offers.
The last weeks have seen a slew of announcements in this space, heralding a new phase in market development, new thinking about the business models (particularly the value to the enterprise) and new urgency in the race among companies across the emerging business ecosystem to get barcode strategies in place – fast (!).
BARCODE MILESTONES
Getfugu, a company I interviewed at CTIA Wireless (video) that provides a cool “next generation mobile search,” signed a strategic agreement with HyTech Professionals to develop mobile barcode applications to augment Getfugu’s “See it,” “Say it,” and “Get it” capabilities with “Scan it.” Adding barcodes to the mix means people can scan barcodes in the real world (products in a store, for example) to get information, coupons and discounts. (More in an MSG interview with CEO Carl Freer in April.)
Techcrunch reports that barcodes play a major role in Facebook’s mobile app and overall location/check-in strategy (details of both to be revealed in April). The use scenario: businesses could print out a QR code (quick response) and put it on a wall or a counter in their venue and people could scan it to check-in at that location.
Not to be left out – mobile operators are also stepping up their initiatives.
In March AT&T joined forces with Mobile Tag, a provider of universal barcode reader technology, to launch a Charter program in the coming weeks to test the use of 2D barcode scanners on AT&T mobile devices. The program, which will involve some 12 enterprise customers across key sectors including consumer packaged goods, retail, hospitality and financial services, is being launched to test consumer response rates as well as the effectiveness of mobile barcodes as an interactive marketing channel. The end-game is about using mobile barcodes (an excellent permission-based way for us to engage directly with companies) to extend the reach of the marketer and the enterprise.
SCANBUY’S FAST MOVES
Scanbuy, a market leader whose solution consists of a multi-barcode reader application and Code Management Platform, has also quietly and cleverly positioned itself at the forefront of new applications and activities to link the common 1D barcodes (UPC, EAN and ISBN) to digital information and destinations. It’s an exciting strategy Jonathan Bulkeley, Scanbuy CEO, hinted at back in November, when I interviewed him for the Netsize Guide 2010 (see Q&A below).
Why is this significant? 1D barcodes are on all packaging around the world. Solutions such as Scanbuy’s effectively “digitally-enable” these objects to enhance shopping and brand experiences.
Scanbuy made some important progress in this direction when it announced that new releases of its ScanLife barcode scanner software for the Android, BlackBerry and iPhone operating systems can now read all 1D barcodes from packaging and traditional media. The result: people can scan objects to launch a website, download stuff or simply access more information such as price comparisons, consumer reviews and contact details. Moving forward, Scanbuy plans to add more features to the service including local search results.
(A discussion of 2D barcodes formats – QR codes, Datamatrix, Scanbuy’s own EZcode – is outside the scope of this post. Scanbuy’s ScanLife barcode scanner application can read all major 2D barcode formats. For background I recommend this earlier analysis.)
But it didn’t stop with the announcement that Scanbuy’s ScanLife app had been updated to read regular UPC barcodes on packaging for the top smartphone platforms. Just this week Scanbuy upped the ante with a full-fledged product (ScanLife packaging Connect), allowing any brand owner to register their existing 1D barcodes to link to any content.
What do we get when we scan a package? This video shows us the experience using an ordinary bag of chocolate chips.
To make this possible Scanbuy has deepened its existing partnership with Augme Technologies, a provider of interactive mobile marketing platforms, to enhance its ScanLife Code Management Platform. According to the company press release, this complete solution is being immediately offered by Graphic Packaging International (GPI) and Shorewood Packaging (International Paper), companies that provide services to some of the leading food, beverage and consumer products companies worldwide. “Over the next 12 months, thousands of products will be activated on the ScanLife Packaging Connect system to give cell phone users immediate access to valuable information from recipes to coupon offers.”
INTERVIEW WITH JONATHAN BULKELEY, SCANBUY CEO
Barcodes are indeed crossing the chasm (!) and the timing is perfect to make barcodes the focus on MSG’s ongoing weekly series to showcase a “best of” selection of executive interviews and hot topics in the Netsize Guide 2010 that have everyone talking.
More than 70 percent of all mobile phones have a camera. Tapping into the hundreds of millions of consumers who carry these devices is the holy-grail for marketers and brands worldwide. Scanbuy is a leading global provider of mobile marketing solutions that use the camera phone as the link between the physical world and the digital world. To date Scanbuy’s ScanLife mobile application and Code Management Platform have been deployed and supported by leading mobile providers and handset manufacturers in the U.S., Mexico, Italy, Spain, and Denmark. Jonathan Bulkeley talks about the growth opportunities in 2010 and beyond.
Q: Scanbuy is rolling out its platform for four major global mobile operators. How are you progressing and what do you expect in 2010?
A: 2009 has been a good year for us and for the industry. We’re rolling our platform out to Vodafone, Telefonica, America Movil and Telenor. On the OEM [Original Equipment Manufacturer] side we’ve signed deals with six out of the top seven handset OEMs, and nine out of the top nine handset OEMs are preloading our software in at least one or two markets. In 2010 I expect we’ll begin to see 2D barcodes become more ubiquitous, but it’s going to take another 12-18 months.
Q: What is the real value of 2D barcodes?
A: The value is the business model it enables. It allows operators to monetize an Internet business model so they get revenue per click just like Google, but from the physical world.
The value to the consumer is ease of navigation. Mobile devices aren’t built to let consumers easily input URLs to access a destination and get relevant and specific content back on their phone. It’s just clumsy. Barcodes are a simple and scalable way of fixing that issue. Consumers just point their devices and, with one click, they’re transported to that destination.
And the third piece of this is the code publishers. Almost 10,000 companies and individuals have signed up to create codes on our platform over the last 12 months, ranging from individuals, who create codes that link to their Facebook page, to some 1,400 companies. For these companies and marketers the technology allows them to create links quickly and easily that enable consumers to connect with them using their mobile phone.
Q: Last year we saw publishers use Scanbuy’s 2D barcode to link their physical books to the product page on Amazon.com. And we know an increasing number of marketers and brands use barcodes in mobile advertising campaigns. What are the business drivers and benefits?
A: In the long term barcodes enable a range of models around marketing, advertising and commerce. In the short term there will be pockets of activity that outstrip others. We’re seeing big brands use barcodes to create interactivity with their printed materials, printed materials, in-store promotions and product packaging.
A second area of activity is retail. In this scenario retailers create interactivity in the store, allowing consumers to get information on a product or scan a code to make a purchase.
And then there’s a whole new use case involving government authorities. In Santiago, Chile, for example, every bus stop has a barcode on it and, with one click, people can get the schedule or find out when the bus will arrive at that stop.
So, I think those three areas — public use, big brands, and retail — are going to lead the charge over the next 12-18 months.
Q: As you said, we will see an explosion in the use of 2D barcodes in the net 12-18 months. How is the business ecosystem shaping up?
A: In Spain, Mexico, France and the U.S. we see that ecosystem is evolving. There are several differences between each of the markets at this point. In Spain Telefónica, Orange and Vodafone are all working on a common platform, which is run by us. So, each of the operators has what’s called a code management platform, allowing them to sell codes in the marketplace or assign re-sellers to sell codes for them. The system is completely interoperable. In our role we run the platforms for each of the operators and – through our deals with OEMs — we have the barcode scanning software on the phones.
Spain is a good example because the whole market is participating. All the operator handsets will come preloaded with our software and, in the next couple of years, there’ll be 53 million phones. As a result, marketers, individuals and public authorities will all be able to go to the platform, create their codes and know they’ll be interoperable across all the operators.
Q: That is impressive, but we’re still not seeing the mainstream use we see in countries such as Japan and Korea. What are the obstacles?
A: It’s the proverbial chicken and egg problem. Operators will say, ‘we’d like to see the brands participating.’ But the brands aren’t going to participate until the software is on enough handsets. In Spain we have solved that problem because the software is on the handsets. Telefónica has pre-loaded the software on some 60 handsets already. By the end of next year [2010] we’ll probably have 50 million devices with the software. When that happens, then advertisers, marketers and public authorities will begin to take it seriously and barcodes will become ubiquitous very quickly.
Q: To be clear, how many handsets do you expect will come with your software pre-loaded by end-2010?
A: The software would be on a least 75-100 million phones. In 2011, you’re looking at 200-300 million phones. They’re will concentrations by market. It will be Spain, the U.S., Latin America, Mexico, Canada, Italy and Denmark, with some other European countries kicking in sometime soon.
Q: We talk about advertising, but this year’s Netsize Guide also highlights the opportunities across verticals such as healthcare. What are the exciting verticals on your radar?
A: The opportunities are unlimited. We see government use, B2B applications, consumer applications, social media – everything! In Japan codes even appear on gravestones so you can scan the code and see the profile of the person who died.
In healthcare we’re working with a company that does medical cards. Each card has the person’s picture, their personal information and a code. This allows us to update the information the code links to on the server, making sure that, when the doctor scans it they see the most recent medical information.
And that’s just the first wave of use. As the mobile devices get better in terms of screen quality, services and content, it only gets better all around.
Whether it’s a barcode or some other trigger mechanism, I can scan an ad on 39th Street in New York for Gucci and I’ll be able to see immediately which retailers sell Gucci within a five block radius and what they have in stock. That’s pretty powerful. The next five years will be revolutionary.
THE TAKEAWAY
My take: The last weeks have seen a raft of strategic announcements in the fast-paced barcode space, and this is just the beginning. Connect the dots, and it’s clear this technology is a perfect fit with our personal mobile lifestyles. We want to be in control of our content and this technology enables us to interact with brands on our terms by using their camera phone to photograph, or ‘scan’, barcodes printed on any media or packaging. Thus, we can launch a specific website or Web-based application, download content or a coupon, dial a phone number, compose an SMS/email, or receive a contact or calendar appointment. The list goes on…But it’s not just about turbo-charging mobile marketing. Some clever companies (such as Renu Mobile) have their eye on the prize: the enterprise. From homeland security to pharmaceuticals to manufacturing. The possibilities are endless. (More about this in my interview with Carol Glennon, CEO of Renu Mobile. Up next!)
DOWNLOAD THE NETSIZE GUIDE 2010
The Netsize Guide – which features exclusive interviews with 28 industry senior executives at leading companies and organizations including Havas, M&S, MMA, Nokia NAVTEQ, PayPal and Sony Music Entertainment — provides unique perspectives and reveals how players across the mobile ecosystem are preparing to meet the challenges and take advantage of the opportunities ahead.
The Netsize Guide 2010 also includes the results of Mobile Trends Survey 2010, an online survey asking +1,000 mobile professionals and practitioners across 67 countries their views on these key themes and their insights into trends that top the industry agenda, including the advance of mobile applications stores, progress towards global mobile commerce and the increasing importance of mobile across a range of business verticals.
Finally, the Netsize Guide 2010 presents detailed data on the wireless telecoms sector in 41 countries, including revenues, market shares and value-added service offerings for messaging and billing of 194 mobile network operators worldwide.
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Disclaimer: Netsize is an MSG supporter. Peggy Anne Salz is author of the Netsize Guide 2010.
