Carriers wary of security issues with mobile marketing

SAN FRANCISCO — Innovators in the mobile industry typically have not hesitated about adding whatever they possibly can to the wireless experience. However, diving head first into mobile marketing is making carriers a little timid.
Amid the various meetings at CTIA Wireless I.T. and Entertainment 2008 — where companies push new technologies, products and promote their heads off — the “Mobile Marketing Ecosystem-What Carriers Want” session focused on why carriers are holding back. Representatives from Alltel Communications L.L.C., AT&T Mobility Inc., Verizon Wireless and Sprint Nextel Corp. spoke about the challenges carriers face when becoming a marketing sector.
One big reason operators are holding back on mobile marketing: security issues. Carriers retain files upon files of personal information about customers and have the resources to target them very directly with relevant ads, but this poses the problem of overstepping a customer’s privacy. Kristi Crum, director of multimedia content for Alltel, said this is what’s been acting as the red light.
“That’s why none of us have come out and done anything,” Crum said. “We don’t want to spoof any of our customers.”
Another privacy concern plaguing mobile marketing is location-based services. Yes, GPS is makes life a lot simpler in terms of finding your way around. But this great new feature means the big, all-knowing carriers know where you are at all times, and with already being fully aware of your personal preferences, it would be quite easy for AT&T Mobility or Verizon Wireless to figure out that you’re walking near a restaurant having a special on sushi, which of course, they know you like and send you a quick text letting you know of the salmon-spicy-roll happy hour (enough with the Starbucks illustrations).
It seems like a great concept, exceptthat it might freak some people out. Kevin McGinnis, a director at Sprint Nextel, said his company trying to figure out how to prevent this from becoming more than it really is.
“It’s something we’re very sensitive to,” McGinnis said. “How far you do you go?”
While carriers sift through these setbacks and determine a plan of action, they’ve also identified priorities. McGinnis listed a few areas he believes will move the process along: 1) continue focus on data usage to make ads and marketing more personal to the user and 2) devise a set of standards for advertisers that will allow them to look at mobile purchases the same way they normally look at buying space. Crum agrees standards are a must and said doing so can eventually allow carriers to be a little more engaging.
“[There are] simple things we can do now and long-term things we need to tackle,” Crum said.
Once mobile marketing reaches point of mass implementation, the next battle is convincing advertisers it’s a worthwhile investment. McGinnis said it’s critical for the carriers to educate advertisers on targeting capabilities and force them to look go at it the same way they would when activating traditional media campaigns.
“When you’re trying to scale it, we’re somewhat constrained,” said Matt Hull, director of integrated advertising for AT&T. “It’s going to be a little while before they figure out what they can really do.” Making phones more of a financial tool is also a goal for the carriers. Mobile transactions, mobile wallet services and even mobile coupons were all areas carriers hope to implement soon. Hull said this is already happening to some extent and will likely continue. These initiatives may have a better chance of becoming a reality sooner because the rare occurrence where the representatives agreed the standards should be cross-carrier.