Celltick is bringing its mobile payments coupon service to countries such as Indonesia and Russia moves that confront some cultural hurdles for it to overcome.
Axis, an online operator in Indonesia with 17 million subscribers, on June 19 launched Axis Buzz, a customized version of Celltick's Active application, which aids the development of special offers. One of Axis' first initiatives is a partnership with KFC to provide free mobile coupons worth about $35,000.
"We are actually working with some of the cultural nuances in these markets," says Ramgopal Vidyanand, Managing Director of Celltick, noting that Indonesia is a largely Muslim country. "KFC is large in that country, but it's also open early in the morning" to accommodate dietary requirements of Islam, he says.
Celltick, in turn, had to adjust the timing of its digital offers to match religious dietary observances, he says.
Celltick and KFC managed deliver most coupons early in the morning, and the coupons can be redeemed at the point of sale all times. "Consumers can save the coupon on app and can show it at the KFC counter to pay," Vidyanand says.
The Axis deal followed another recent partnership with KupiKupon, a provider of daily deals in Europe. KupiKupon publish its coupons with the help of Celltick's coupon server.
"They are a large strategic partner. This gives us reach into emerging markets without putting feet on the street," Vidyanand says.
KupiKupon, which operates in 52 Russian cities and in Kazakhstan, Ukraine, Latvia and Estonia, will target consumers with deals and offers based on the location and demographics of mobile handset users. These coupons can be redeemed in-store or online.
There are also cultural considerations in Russia and surrounding countries, though in this case more due to the region's level of technology adoption. Celltick is expanding in Russia as that country's mobile payments market just starts to mature.
"Russia is still emerging on the e-commerce side of the payments business. People are starting to transact more on the Web, and even when they transact on the Web they still often use payment methods such as payment on delivery or cash," Vidyanand says.
Celltick, which integrates mobile payments, targeted marketing and coupons via partnerships with payment providers, is also active in Europe, North America , and parts of South America and Africa.
Celltick offers different options for fees. In one option, the consumer pays a fee to Celltick, but accesses the discount directly with the merchant by using a code. In another model, the merchant pays for the distribution of the coupon and splits the revenue with Celltick.
Other companies active in the space include Groupon, which has embarked on its own mobile payments expansion to improve relationships with merchants.
Mobile payments and special offers must be tailored to international markets if the model is to succeed, says Gareth Lodge, a senior analyst at Celent.
"There have been very few mobile payment schemes that have successfully transferred to another country," Lodge says. "That's partly culture, but partly a reflection of the differing needs and infrastructure as well."
Payments companies can face a number of cultural challenges when delivering special offers in different markets, says Emily Collins, an analyst at Forrester Research.
"Consumers in other countries value loyalty and their brand relationships differently. Some value status more than points, or points more than instant savings," Collins says. "So a strategy that works really well in the U.S. may not be as effective when porting it over to Europe or [the Asia/Pacific region]"
Similarly, organizations may have separate budgets, marketing teams, strategies, and provider relationships depending on the geographic location which adds complexity to global expansion of loyalty programs, Collins says.
Other challenges arise based on the level of technological integration required in each region, she says.
"For example, they may need to integrate with new POS systems, pull in data from separate customer databases, and reconcile processes/business rules for executing loyalty," Collins says. "Several of the organizations I've spoken with that are in the process of expanding their loyalty programs globally are creating separate approaches within the same vendor or are sourcing it to local providers in the markets they are targeting."