By Anita Bajaj Newton

Interest in mobile coupons has increased dramatically in the last year.

Mobile coupons represent tremendous promise for marketers who want to acquire and retain customers. However, marketers must pick the right approach or the results will be anticlimactic at best.

Mobile coupons are a natural outgrowth of two important changes in consumer purchase habits.

First, conscious consumerism is on the rise, as is a new psychology of thrift. Interest in coupons has increased and shoppers are increasingly looking to the Web and mobile for these offers.

Second, wireless data adoption has accelerated dramatically. A recent Nielsen mobile study shows Web usage has grown 74 percent in just two years.

A mobile coupon is an offer exchanged for a monetary discount that is stored on a wireless device.
Consumers can save a coupon from a mobile WAP site or receive a coupon code via an inbound text message or mobile advertising network. Once downloaded, users get offers based on their location, age and gender.

These coupons can then be redeemed at the point of sale.

The good
Mobile coupons represent the next marketing frontier and a marked improvement over today's inefficient paper process.

Product manufacturers spent more than $4 billion to distribute 250 billion-plus paper coupons. Despite this investment, less than 1 percent is redeemed. Effective targeting is a challenge, and lack of data leaves marketers with an inexact way to measure ROI.

Mobile coupons are convenient, eco-friendly and can be targeted based on preferences, purchase behavior and location.

Moreover, manufacturers can track purchase data in real-time. The results are impressive, with redemption rates as high as 5 percent to 30 percent.

The bad
The problem with mobile coupons has less to do with the idea and more to do with delivery.

Specifically, the most common method of mobile coupon redemption -- download, save to phone and show to cashier -- is unlikely to work.

This "show phone, save money" option is a challenge for the following reasons:

Scaling ?Skip' the cashier
A mentor of mine who led a successful Fortune 500 sales organization once told me marketers often fail because they don't develop programs with the lowest common denominator in mind.

In this case it is ?Skip,' your lowest performing cashier. When a consumer "presents" the offer to the well-meaning cashier, will Skip get it and follow the process successfully?

Delay in the checkout = disaster for the retailer
Let's say Skip is familiar with this coupon method and the first is redeemed successfully.

In many cases Skip has to manually enter a code shown on the phone. What if the shopper has a second coupon? Or worse, multiple ones?

A 2009 Microsoft study reported that carving seconds from each customer transaction can equate to millions of dollars in annual retailer cost savings, not to mention the impact on shopper satisfaction.

Tying the front end to the back end
Another stumbling block is that retailers need proof of redemption in order to get paid.

A physical coupon is often the only means to get reimbursed especially if the retailer's backend hasn't been updated with the new mobile coupon process.

The ugly
Changing consumer behavior is hard. Consumers are constantly bombarded with new technologies. The makers of these services should note their main competitor is not the company down the street but rather the consumer who refuses to get off the couch.

If a consumer has to download an application and then find the application at checkout and then present to the cashier at the point-of-sale ? well, that's a lot of work for 25cents of a half-off jar of mayonnaise.

And if a shopper is successful, how do you keep the user coming back? The big idea here is not use but continued usage.

Punch line
There are a few promising mobile coupon delivery methods. The first is to download the UPC bar code and have Skip scan consumer's mobile phone.

The key is to ensure infrastructure compatibility and coupons are lined up to scan simultaneously.

Another promising method is linking the coupon to the retailer's loyalty card. Users access and download the coupon from their mobile phone. Shoppers simply hand Skip the loyalty card, he swipes it and the coupon is automatically redeemed.

Consumers want to save money, save time and save the planet. With the right method of delivery, mobile coupons can do that.

Anita Bajaj Newton is chief marketing officer of Zavers Inc., Kansas City, KS. Reach her at .