Kesha Mahtani, a regular patron at the Fast Trax restaurant in New Delhi, knows how much she would save on meals even before she walks in to munch on burgers and French fries. That's because Mahtani carries her discount vouchers on her mobile phone.
"I usually walk out with a free smoothie, milkshake or 20 per cent discount on the French fries," she says.
Fast Trax, a five-year-old fast food restaurant has a Customer Relationship Management system in place to send targeted SMSes to customers.
Fast Trax has 22 restaurants spread across New Delhi. Each of these maintains its own database of customers.
"We send personalised SMSes, which even address the consumer by his/her name so that it stands out from spam SMSes," says Bhanu Yadav, the 26-year-old owner of Fast Trax restaurants. Coupon redemption was at 2 per cent when Yadav was using paper fliers to reach customers. Today, it has increased to 6 per cent with coupons that are texted straight to mobile phones.
According to Cisco IBSG Connected Life Market Watch, nearly 70 per cent of consumers in India carry their mobile phones during shopping and 20 per cent redeem mobile coupons. Today, mobile coupons are used by over 3,000 retailers at various scales and are believed to be a Rs 5-crore (Rs 50 million) business opportunity.
Experts say the sector is growing very fast and has the potential to become a Rs 50-crore market in the next five years. And, it is because of the ease that mobile coupons offer to consumers.
However, experts say smaller retail outlets seem more open to using this service because cost of mobile coupons is up to four times lower than paper-fliers. Dominoes Pizza, which gets more than 90 per cent of its business from home delivery, too, maintains a large database of consumers.
The database also makes a note of the address that they order from and use this information to send outlet-based discounts.
Jasper Infotech, which offers mobile coupon solutions to its clients, highlights that the perceived value of mobile coupons is greater in India because internet continues to remain a less viable alternative.
"It is reasonable to believe that consumers are not comfortable with paper coupons, which they have to store and carry whenever they need to avail of discounts," says Kunal Bahl, CEO, Jasper Infotech.
He adds it will be presumptuous for retailers to believe their consumers would scrounge weekend newspapers to collect and read about various discounts and offers to save money on their weekend shopping trips.
Meanwhile, telecom providers have already started offering location-based mobile coupons to consumers.
For instance, if a consumer walks into a mall and his service provider has tie-ups with brands located in the mall, the consumer would get an instant SMS, informing him about, say, a buy-one-get-one-free offer.
"Purchases like dining or going to a spa or movies are highly impulse purchases. Having a coupon on the mobile is a powerful tool to facilitate the impulsiveness of the decisions made on the move," says Bahl, who provides mobile coupon technology to Baskin Robbins.
According to experts like Rajiv Hiranandani, country head of Mobile2Win, retailers in emerging markets must roll out compelling mobile services or risk being irrelevant to a vital consumer segment - the young, affluent, and tech-savvy. He believes brand-sponsored applications for mobile phones are the next step in mobile retailing.
"Consumers can download applications that could be sponsored by brands. They can download coupons of stores and redeem gifts or discounts," he says.
