Mobile loyalty and rewards service provider Tetherball has teamed with Vivotech to offer its recently introduced RFID-based mobile loyalty programs to existing users of Vivotech’s contactless reader technology.

The companies formed the collaborative alliance to accelerate mass-market adoption of mobile loyalty programs through contactless redemption using existing handsets. Consumers place an RFID sticker on their mobile phone and text in a code to opt in to receive offers from a retailer, which they can redeem by waving their phone in front of a contactless reader.

“We’re focused on making mobile loyalty programs radically simple for consumers and for retailers,” said Jay Highley, president and chief operating officer of Tetherball, Indianapolis. “We make redemption accessible at the point of sale without adding incremental hardware costs and complexity.

“This alliance we’ve formed with Vivotech, the largest manufacturer of RFID and a global leader in NFC, is making it easy for our clients to leverage RFID technology using their existing contactless readers,” he said. “Retailers can put that investment to work to drive incremental traffic and revenue to their store through these mobile loyalty programs.

“The concept is to close the loop by letting consumers redeem rewards and help retailers validate them in real time via a RFID-based mobile loyalty program that is simple and easy to use, with no downloading of apps necessary.”

Tetherball’s goal is to help clients—national retailers and ad agencies—drive customer loyalty through mobile coupons, rewards programs, sweepstakes and notifications.

Vivotech is a software provider of near field communications mobile-phone payments, over?the?air provisioning of promotions and payment cards and smart-poster applications. Vivotech’s investors include Citi, First Data Corp., Motorola Ventures, NCR and Nokia Growth Partners.

The company has shipped more than 550,000 contactless terminals to more than 35 countries worldwide. Approximately 140,000 merchant locations in the United States have deployed close to 500,000 of Vivotech’s contactless readers.

Redemption goes contactless
By integrating traditional marketing methods such as calls-to-action via in-store advertising, customers are engaged to sign up for mobile loyalty rewards programs offering promotional discounts and rewards points for purchases or visits.

Upon joining, customers are given a Tetherball Tag powered by Vivotech technology, a tiny RFID chip that is affixed to their current mobile phones that uniquely identifies them through Tetherball’s technology platform.

Tetherball clients are then able to send offers to their customers via standard text messaging. Offers are redeemed electronically using existing in-store contactless point-of-sale terminals or stand-alone contactless kiosks provided by Tetherball.

Many brands have been deeply involved in mobile loyalty.

Qdoba, a Mexican “fast-casual” quick-service restaurant franchise specializing in burritos, has added a mobile rewards program to its traditional loyalty card program (see story).

Dairy Queen ran a mobile rewards loyalty program using radio-frequency identification — RFID tags — to send coupons and offers to consumers’ handsets (see story).

In its second attempt at a mobile loyalty program, HotBox Pizza turned out better results with the help of Tetherball (see story).

“The move to contactless is an inexpensive add-on to the technoglogy retailers already have deployed,” Mr. Highley said. “This solution would let them add a very inexpensive plug-in add-on to their current POS that could instantly enable them to read mobile loyalty tags from Tetherball.

“Retailers get accurate real-time redemption information, and across all of our clients we’ve seen just under 20 percent redemption rate and less than 10 percent opt-out,” he said. “Mobile loyalty affords retailers the opportunity to create direct engagement with consumers who have raised their hand and said ‘I want to participate.’

“Loyalty is not just about coupons, it’s about forming an interactive and trusting relationship that transfers value to the consumer.”