Going From Mobile To Plastic? A Step Backward, But A Clever Short-Term One

A vendor named OfferIQ is pushing an idea that, at first, sounds positively backward. It's a way to take a mobile digital coupon and convert it to be accessible by a plastic credit or debit card. What's next? Taking SMS messages and routing them to a paper fax machine?

But the idea is actually grounded in reality and boosts near-term revenue. Like it or not, mobile coupon redemption is not especially easy for most retailers. As American Banker recently pointed out, scanners need upgrading and associates need to be trained.

Although there's little argument that mobile payments and coupons are the right way to go, most retailers who have yet to make the necessary upfront investments to handle such transactions have to refuse mobile options entirely. The approach of some vendors, including OfferIQ, is to push the incentives back onto various card brand programs. Bottom line: The retailer gets to leverage the mobile sale without the hassle of the IT side of accepting mobile payments and coupons.

"Consumers opt in to receive alerts to new incentives through their existing relationships, such as through their credit card providers, mobile coupon providers, affinity groups, charities or employers," OfferIQ argues, "making them more apt to act and boosting traffic and average spending up to an anticipated 30 percent. Every offer requires a minimum spend, so the dollars are meaningful."

The downside to this plan is that it might reduce the need for some merchants to make the painful moves necessary to truly support mobile coupons. But looking at it from a practical—rather than an idealistic—perspective, it's certainly a compelling approach.

This short-term strategy also preserves some of the mobile device's strengths, such as geolocation alerts and related discounts. Let's just hope that retailers don't get too used to this tactic.