Mocapay Inc. is testing a mobile loyalty and prepaid gift card platform that it intends to make widely available to small merchants in the first quarter of next year, the company’s president tells ISO&Agent Weekly.
Denver-based Mocapay is in discussions with five independent sales organizations and plans to choose two to begin marketing the product to merchants by the end of October, says Doug Dwyre, the company’s president.
With the Mocapay offering, merchants would buy monthly subscriptions that ISOs may mark up, Dwyre says. The subscriptions would cover a predetermined number of transactions, and merchants would pay a per-transaction fee for any additional volume.
Dwyre declined to say how much merchants would pay for subscriptions because the amount would vary according to ISO markups.
To use the system, merchants would log on to a Mocapay portal that helps users create loyalty marketing campaigns and select recipients of loyalty offers that could include coupons, discounts or points, Dwyre says.
The consumer receives a numerical Mocapay code he can read to the merchant to redeem the offer. The single-use code is valid only for the period the merchant specifies, a Mocapay spokesperson says. Because of the limited availability of the offer, consumers cannot forward the code to someone else or use it more than once, says the spokesperson.
If the merchant prefers, Mocapay can tie the code to a barcode or to a Near Field Communication service, the spokesperson says.
Mocapay is still tweaking the portal to make it easier for small merchants to use, a process the company plans to finish by the first quarter, he says.
The platform works with many point-of-sale systems and with third-party loyalty programs, says Dwyre. It also works with most cellular phones because it can operate via text messages or on the Internet, he notes.
The platform tracks redemptions so merchants may determine what customers are responding to and use that information to target subsequent promotions and build relationships, Dwyre says.
Mocapay is receiving its strongest reception for the platform among quick-service restaurants and spas and is beginning to attract some attention in the hospitality market, Dwyre says. Retailers with customers who make frequent visits would be among the most likely prospects for the platform, he says.
The company has developed point-of-sale marketing materials to entice consumers into downloading the application to their phones, Dwyre says. Retailers might use the materials to offer discounts or credits for joining loyalty clubs, he says.
The platform supports the electronic equivalent of prepaid gift cards without the need for a plastic card that consumers might misplace and never use, Dwyre says.
Some merchants may use “comp cards” on the platform to offer discounts to employees or to accompany apologies for dissatisfied customers, he notes.
Mocapay stores sensitive customer information on its servers, and users gain access to it only through single-use Mocapay tokens based a numeric code, Dwyer says.
The timing for the rollout seems right, according to analyst Todd Ablowitz, president of Centennial, Colo.-based Double Diamond Group LLC.
“Everyone is looking at how to use the mobile phone to advance their business,” Ablowitz tells ISO&Agent Weekly. “Every day we’re getting closer to having a world where we pay by phone. In fact, (many consumers) have used their phones to buy music, ringtones and apps.”
