The mobile marketing company Mocapay Inc. said it is working with the processor eNational Payments to use location technology to send coupons and other promotions to consumers on mobile devices.
The technology will allow eNational Payments to deliver highly targeted marketing offers based on a consumer's location and shopping preferences, eNational Payments said.
ENational Payments plans to enhance Mocapay's service with its own "geofencing" technology that can notify consumers when they are within two miles of participating merchants' locations.
Consumers who opt in to the service may receive a text or e-mail message notifying them of merchants' special offers or available coupons.
"Geofencing combined with Mocapay's mobile platform enables us to send gift certificates, coupons and savings directly to a consumer's mobile phone," an eNational Payments spokeswoman said.
Mocapay, of Denver, provides gift card and loyalty program services to merchants. This year it rolled out a service that allows merchants to give customers a one-time authorization code to redeem rewards and conduct purchases from prepaid accounts using mobile handsets.
ENational Payments, which is based in Chicago, said this month that it will offer Mocapay's mobile marketing service to its clients free.
The service also is free to consumers. The companies did not disclose other terms of the deal.
One analyst says that such handset-based mobile marketing technology is an important step for merchants as they explore the future of mobile payments.
"This type of solution is of interest in today's market because loyalty and gift programs are hot commodities," said Gwenn Bezard, a research director with Aite Group LLC in Boston.
By integrating with a mobile platform, he said, "merchants can move away from paper or physical cards, which can be costly to manage."
And while not every consumer may want to receive mobile coupons, there still is interest among a fairly large group, Bezard said.
In an online survey of 496 U.S. consumers Aite conducted in 2008, roughly 25% of respondents said they considered themselves "mobile-marketing friendly."
Of those, 60% said they liked receiving offers and coupons for merchant discounts on their mobile phones.
Indeed, "when you talk about mobile payments, many companies see it as a funnel," Bezard said.
"Ultimately," he said, "the idea is to start with mobile marketing and eventually migrate to mobile payments."
In June Mocapay partnered with the point of sale equipment reseller Postec Inc. to enable Postec's customers to integrate Mocapay's mobile platform with their existing point of sale systems.
Mocapay said it was helping Postec reach a younger audience whose members are less responsive to marketing over conventional media and prefer to make electronic transactions instead of carrying cash.
ENational Payments provides mobile and contactless payment transaction processing services to more than 2,800 nonbanking financial services businesses, such as grocery stores, pharmacies, convenience stores, restaurants and online merchants.
