• by Mark Walsh  @markfwal, June 13, 2008

Yahoo is teaming with Coupons Inc. to offer mobile coupons through its Yahoo Mobile service. The initiative would create a national platform for large brand advertisers to distribute mobile coupons, which so far have mostly been tested only in local markets or niche categories. 

"Our goal in working with Yahoo is to combine our platform and brand marketing relationships with Yahoo's mobile audience to really bring scale to the industry," said Jeff Weitzman, chief marketing officer of Coupons Inc.

To help accelerate that effort, Weitzman said the company would offer participation in the mobile couponing program to its clients for free during the next 12 months. Papa John's Pizza was the only advertiser announced Thursday in connection with Yahoo Mobile coupons.

But Weitzman said many of the 800 brand marketers with which it works have expressed interest in extending coupons to mobile devices. Quick-serve restaurants and retailers are the most likely to be early adopters because they potentially offer the most direct way for people to redeem mobile coupons.

General Mills, Kimberly-Clark, Kraft Foods and Clorox are among other Coupons Inc. clients.

Even so, Weitzman admitted that how mobile coupons are redeemed remains the biggest challenge to be overcome. The online coupons that the company typically distributes through Yahoo and other sites are printed out by consumers for redemption in stores.

But mobile coupons would rely on completely electronic means, such as a secure bar code system allowing shoppers to swipe mobile devices at the point of sale to get discounts or special offers.

Getting retailers comfortable with new technology and methods for redeeming coupons is no small hurdle. "Anything that slows down the check-out process is a problem for retailers," acknowledged Weitzman.

In March, some of the country's leading packaged-goods companies began to test a system for distributing electronic coupons to mobile devices with grocery retailer Kroger.

Using technology from Cellfire, the consumer scrolls through available discounted goods on their mobile device and composes a list of items to buy. Cellfire then communicates the list to Kroger, which automatically deducts the discount from the price at the cash register.

Weitzman said Coupons Inc. already provides printable coupons on Kroger's Web site and expects to expand its relationship with the retailer.

Weitzman also offered few details about how coupons would be offered or redeemed via Yahoo Mobile. But he said distribution could involve different methods, including e-mail, banner ads, SMS text-messaging and applications on Yahoo's mobile portal. "We can reach out to customers in the way it makes most sense for them," he said.

Tim Bajarin, president of technology consulting firm Creative Strategies, said extending online coupons to mobile was a good step by Yahoo. "Consumers are using their cell phones for a lot more then voice and texting these days and consumer-friendly applications like coupons are on track to be hot items," he said.

For its online offering, Coupons Inc. last week launched a program called Brandcaster that goes beyond its existing system to allow consumers to print coupons with a single click and without having to leave the site they are visiting. Weitzman said Brandcaster could eventually be extended to the mobile realm as well.

About 12% of U.S. Internet users click and redeem online coupons, according to a 2007 comScore Media Metrix study.