June 1, 2007, 12:00 AM

Hollywood Video focuses on cell phone as coupon device

The multi-channel provider of movie rentals is using Cellfire, a mobile couponing service, to deliver coupons to registered users’ cell phones for store redemption. A pilot program produced a redemption rate of 200% higher than Hollywood Video’s traditional paper coupon program, according to Cellfire.

As consumers migrate to new entertainment media choices such as video on demand or Internet downloads, Hollywood Video is looking for new ways to acquire new customers for in-store movie rentals. The company used Cellfire, a mobile couponing service, to deliver coupons to registered users’ cell phones for store redemption, in a pilot program that saw a redemption rate 200% higher than with a traditional coupon program, according to Cellfire.

The coupons are delivered to registered users’ cell phones via an application that users download into their phone from Cellfire’s web site. Once the application’s loaded into the user’s phone, offers are delivered wirelessly to the phone, based on the user’s registered location. New offers are accessible to the user when he or she refreshes that application on the phone.

The coupons are displayed on the cell phone’s screen in full-color graphic format. They’re not scanned at the point of sale. Instead, the coupon on the cell phone screen is simply shown to an associate for redemption. Associates at participating stores are trained to identify the coupons, says Brent Dusing, Cellfire’s CEO.

Dusing says that with no paper or printing costs, the mobile campaigns have lower customer acquisition cost and lower production costs than does a traditional paper coupon campaign, though he did not disclose numbers. He also says mobile campaigns have a high reach into the youth demographic, with 63% of Cellfire’s audience base under 35 years old.

Hollywood Video’s pilot program with Cellfire, originally limited to California, went national last year. The national campaign showed that new customer acquisitions through Cellfire were 25% higher than with traditional couponing, with significantly lower costs and more opportunity to optimize the campaign going forward based on initial results, according to Cellfire. Besides Hollywood Video, other national brand marketers participating in Cellfire’s mobile coupon program include Domino’s Pizza, Hardee’s restaurants, Peet’s Coffee & Tea, T.G.I. Friday’s, and 1-800-flowers.com.


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