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As a matter of fact the majority of manufacturers (Samsung, LG, Sony, HTC, Blackberry, Motorola, Nokia) now consider NFC technology a priority feature and are incorporating it into their newest products. Android devices such as Google Nexus and Samsung Galaxy S III powered by the latest operating systems were among the first to allow you to send content between devices just by pressing them back-to-back, ideal for sharing or exchanging content – web pages, maps, videos, contact info, photos, enabling Bluetooth, and more – with other people’s phones and tablets. Apple however still has yet to figure it all out and many marketers were disappointed that the latest iPhone 5 release was still without NFC technology. That will hopefully change whenever Apple releases the iPhone 6. Once Apple does this, NFC will surely take off by storm in North America as it most certainly already has other parts of the world including Europe, the Middle East and Asia. Why? Because Apple is now considered most valuable brand on the planet even though more people actually own an Android based product. Apple still holds the clout card and once they integrate NFC into their mobile devices, we are going to see some very innovative uses for NFC that could truly unite print and digital marketing mediums for the next generation. Or perhaps Apple is holding out on purpose. Will we ever see an NFC-enabled iPhone? Without Apple, it may never truly break into the American mainstream.
UPDATE SEPTEMBER 2014 :: APPLE TO RELEASE NEW iPHONE 6 - NFC enabled :: "All the new Apple devices will come equipped to operate its new payments service "Apple Pay", which launches in the United States allows users to pay for items in stores by tapping their phone on contactless card payment terminals instead of the underlying credit or debit card. For Apple Pay to work the new devices come with a "secure element" chip and a near-field communications, or NFC, antenna."
However, even in spite of Apple's hold back, we are seeing a huge expansion of NFC adoption in the phone market. Take Google Wallet for example which allows you to securely store your credit card, debit card, send money, and even buy online. You can also pay in stores by tapping your NFC-enabled Android device at any merchant location accepting contactless payments. Verizon, AT&T and T-Mobile have formed ISIS Mobile Wallet for NFC transactions. Apple's AirDrop is fine, if you live in a world where everybody has a modern Apple device with the latest iOS 7. Many of us don't live in that world. And meanwhile, millions of people have been using NFC every day for years now... especially in the U.K., Japan, Hong Kong, and Taiwan to name a few. Contactless payments is really only just one of the basic capabilities of NFC.
So what exactly is NFC? You most likely have heard the hoopla somewhere and you’re wondering what exactly is it all about. You might even have seen NFC somewhere in your phone menu and wondered what the letters mean. NFC (Near Field Communication) is a standards-based, short-range wireless connectivity technology that enables two-way-interaction between electronic devices. Typically, NFC is used for contactless communications between a handset and a terminal. NFC evolved from RFID (Radio Frequency Identification) technologies, developed since the 1990s. Where RFID is built on long-range, NFC is built on extremely short-range.
It’s a bit of a stretch, but strictly from a marketing perspective it is basically like taking the QR Code concept and adding a short-range RFID of sorts into the mix. Except in this case unlike the QR Code, you don’t have to use your phone camera coupled with a downloaded third party mobile app to use it; fumble fumble and hope it works. The NFC reader is already built into your smartphone. The NFC microchip can transfer information whenever it’s tapped with an NFC reader. NFC always involves an initiator and a target; the initiator actively generates an RF field that can power a passive target. Again, it’s very short-ranged so your NFC enabled mobile device generally needs to be within about 2cm to 10cm of the NFC tag.
Got all that? So what’s a tag? NFC tags (the microchip) contain data and are typically read-only, but may be rewriteable too, which would have huge potential in retail packaging. This is where the NFC capable phone is held close to an NFC tag that has been programmed to provide the customer with product information and even track purchases collecting all kinds of data. NFC tags can also store personal data such as debit and credit card information, loyalty program data, PINs and contacts, among other information.
In a nutshell, Near Field Communication works in a couple of different ways: The user establishes a communication connection either between two NFC enabled devices (two phones) or a device with an unpowered NFC chip called a “tag”. NFC technology allows tiny RFID-like circuits, or “tags,” embedded in physical objects which then send data directly to NFC-enabled devices. NFC builds upon RFID systems by allowing two-way communication between endpoints. In Japan and the U.K. for example, people can tap their phones to terminals situated at passenger train stations to aquire their tickets or making purchases at kiosks. It's fast and convenient. For promotional marketing purposes, the ideas and uses are almost endless. Because this is two-way technology, it could be used to collect as well as redeem things like vouchers or coupons, update loyalty points – a marketers dream. You could literally embed these NFC tags on any type of consumer package providing relevant links to websites to gain direct information. Again, unlike the QR code, you do not have to take a picture and go through that procedure. You just wave your phone over the package, or tap it, and it does the rest for you.
NFC tags embedded on posters were used during the launch in London of the 2011 blockbuster movie X-Men: First Class, which may have been the first time that NFC had been used in a public marketing campaign. The promotion delivered media-rich high-quality content with a simple tap of the phone to the movie poster. In the world of geekdom, it was successfully engaging and interactive by touching the consumer emotionally and intellectually making the campaign a winner on all accounts.
Although the technology itself may not be new, brands are starting to find innovative uses. Samsung for example introduced several ad campaigns using interactive kiosks and printed posters. Samsung “Share to Go” posters created an amazing buzz [watch the "Not Just A Poster" Samsung video here]. One NFC inspired marketing campaign called upon users to tap their phone on an image of a newly published novel. In seconds the novel was downloaded to the device. Another “Share to Go” interactive poster was placed near high traffic subway platforms where users just had to wave their phone over an advert image and music automatically downloaded and installed ready to play before they had a chance to step onto the train. All this was done in an instant without any clumsy confusing procedures making it a perfectly satisfying experience for the commuter. [NFC Enabled Smart Posters Hit US]
Wineries and wine stores for example are getting on the band wagon adding NFC to wine labels giving customers information about the product, its history, even videos of how the product is made [watch this Youtube video here]. Many retailers are now implementing NFC technology on their labels too both at point-of-sale and point-of-purchase. Promoters are utilizing NFC integrated wristbands for concert attendees. Interactive key cards are being used at theme parks as digital wallets, passes and assisting along as virtual tour guides. NFC can record the history and patterns of visitors enabling profiling and prediction of behavior and preferences.
Are NFC tags expensive? Yes and no. It's fairly cheap technology. This is where the QR code is definitely the cheaper alternative however. QR codes are free to print. Many marketers all over the world are not yet aware of the marketing possibilities NFC offers due to several reasons, mostly because it isn’t mainstream, yet. It will probably take a few more years before we see the technology standardized and become commonplace on all smartphone and mobile devices, so the focus on classic advertising strategies will continue into the near future.
When will we see broad market deployment? What is the forecasted opportunity for NFC? Commercial rollouts of NFC have increased significantly every year, reaching hundreds of thousands of consumers. These deployments are expected to continue as more NFC-enabled devices come to market. Analyst firm Berg Insight recently reported that global sales of NFC-enabled handsets increased tenfold in 2011 to 30 million units. The same report states that NFC handset shipments are growing at a compound annual rate of 87.8% and forecasts that shipments will reach 700 million units in 2016. Deloitte predicts there will be 300 million NFC-enabled devices sold in 2013. In Japan, FeliCa, which is a similar passive mode contactless technology, has already been implemented with payment as a primary application. [original ref source]
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