Cadbury targets mobile marketing

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As the confectionery giant Cadbury prepares to launch the UK’s biggest ever text messaging marketing campaign, our e-commerce reporter John Moylan looks at why consumers could be turned off such campaigns by junk mail and scams.

Its an irresistible combination – chocolate and mobile phones.

From next month the confectionery giant Cadbury will be offering a million pounds worth of prizes to consumers who send the firm a text message.

In the UK’s biggest ever text messaging campaign, Cadbury will print details on the wrappers of 65 million confectionery bars.

Consumers will be asked to respond to questions like “R U A 5K WNR?” by messaging a number. Chocolate lovers will learn within seconds whether they’ve won.

“What we are doing is talking via today’s most relevant communications channel to people who buy and eat our chocolate” says Cadbury’s Richard Frost. “They will be contacting us rather than us contacting them.”

The promotion will give Cadbury an invaluable database of mobile phone numbers.

Richard Frost accepts the company will use this to target further promotions at its consumers, but he claims the company has no immediate plans to follow up the campaign in mind.

“There’s no advantage in sending out unwarranted text messages . It is self defeating and counter productive,” he said.

In the past 12 months marketing executives have jumped on the text messaging phenomena. It has exploded amongst young people, a key demographic for companies wanting to promote their brand to a new generation of consumers.

Nestle, McDonalds, drinks firms and even cinema chains are already targeting promotions at mobile users. Once a fortnight 30,000 readers of the teen magazine Smash Hits are messaged with details of what’s in the latest edition. Nescafe is to sponsor a free messaging and reply service through the internet service provider Lycos as part of its campaign to attact younger coffee drinkers.

And even the Labour party messaged thousands of party members during the election and urged them to pass messages on to their contacts.

But text marketing is already being abused.

The authorities have just shut down one scam which involved mobile users being duped into running up big bills. It is believed that thousands of people were sent a message asking them to urgently phone a number. When they did, they heard an engaged tone. This was actually a recording. The mobile users were being charged on the premium rate line every time they called.

George Kidd is the Director is ICSTIS, the body which regulates Premium Rate calls.

He claims consumers are increasingly being targeted by firms operating similar scams and even sending unwarranted junk text messages.

“There are a small number of people out there with malicious intent to take advantage of consumers and that is not acceptable to us and it is not acceptable to the rest of the Premium Rate Industry which operates on a perfectly legitimate basis,” said Mr Kidd.

The Wireless Marketing Association (WMA) has drawn up guidelines for firms wanting to promote products to consumers via mobile phones.

Steve Wunker, Chairman of the WMA says it involves three basic principles:

“First the contact has to be instigated by the consumer. Second the consumer always has to have an easy way to opt out of further communications. And finally they always have to know who the message is from and how to contact that party”.

Meanwhile Cadbury’s Richard Frost claims it will be easy for people to avoid being sent further messages. “If you don’t want to receive anything from us simply text us with the word “Stop”. That’s it – finito!”.

Vodafone backtracks on 3G

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Vodafone, the world’s biggest mobile phone firm, has admitted that the launch of its third-generation (3G) phone services could well slip into 2003.

The news comes as the company slows down construction of its 3G mobile phone networks. Vodafone chief executive Sir Christopher Gent attributes the delays to a lack of handsets.

The news caused Vodafone shares to fall 4.6% to 141.25 pence on Friday. The stock has now lost almost two-thirds of its value since March last year.

A delayed 3G launch means that it will be even longer before Vodafone is able to recuperate some of the money invested in securing the new licences and building the network.

3G mobile phones promise to relay information 40 times faster than the current phones and will be able to display video, stream music and connect at high speeds to the internet.

The slower pace of development means that the group now plans to build 750 3G base stations in the UK by the end of this year instead of the 1,200 originally planned. One Vodafone analyst said that the slowed rollout would mean a cut in capital expenditure on 3G of 5% in the year to March 2002 and a 13% cut the following year.

The delay has been caused by the late production of dual mode handsets which support both 3G and existing services. “There is, despite what some manufacturers say, a slip in the availability of handsets,” Sir Christopher told the Wall Street Journal.

Vodafone’s arch-rival BT is pushing ahead to launch the UK’s first ever third-generation phones on the Isle of Man within the next few months. And BT pipped Vodafone to the post in launching its GPRS mobile phone network – mobile services which are not as advanced as 3G but offer an always-on connection to the internet.

In Japan, NTT DoCoMo has already launched a trial of third-generation phones but experienced a series of glitches. Investors have shunned the telecoms sector because of fears about the large amount of money invested into 3G mobile phones.

They feel that there is not enough evidence to show whether the phones will work successfully, attract enough users or be commercially viable.