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McDonald's Japan Brings Discounts to Phones

The company is sending coupons to consumers via their RFID-enabled mobile phones, which they can then use at its restaurants to receive discounts.
By Claire Swedberg
Jun 02, 2008McDonald's Holdings Japan, Inc. has launched a pilot enabling customers to use RFID technology to receive and redeem discount coupons over their cell phones. The phones are equipped with a near-field communication (NFC) RFID tag containing a Sony FeliCa chip that allows the handsets to be used as mobile payment devices, as well as to download coupons for use at McDonald's restaurants.

On May 20 of this year, 175 McDonald's restaurants in the Kyushu area of Japan began offering the service. By July 2009, the restaurant chain expects to expand the coupon system to include the country's other 3,800 McDonald's restaurants.

Using contactless coupons (instead of paper versions) is expected to speed up the payment process.

The system is built on NTT DoCoMo's Osaifu-Keitai platform for mobile-wallet services, which has enabled Japanese consumers to use an NFC FeliCa chip in their phones for the past three years to pay for transit fare at train stations, and to make purchases at participating stores. In the past, phone operators could utilize the Osaifu-Keitai platform and the FeliCa chip to pay for meals at a McDonald's point-of-sale (POS) terminal. Now, they can also use their phones to download coupons specific to their buying preferences, thereby eliminating the need to clip out or carry paper coupons.

McDonald's Japan launched the system as an alternative to television and newspaper advertising—a market which the company says has been dwindling lately as a more diversified Japanese audience spends less time in front of the television, and is easier to reach via their phones than any other medium.

In July 2003, McDonalds first launched its cellular Web site—accessible from mobile phones—and an e-mail newsletter, which it releases every Friday with new promotions for products. Now, each pilot participant will also receive coupons based on their purchase history at McDonald's, after they install the necessary software onto their phone. They can then select specific coupons by scrolling over the options, and make a purchase at the restaurant's POS terminal by tapping the phone next to the device and receiving the selected discount. The payment can then be either automatically deducted from the user's bank account, or billed later in a credit card statement.

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