You might not think burgers and phones go together. But when one player brings marketing savvy to the table and the other brings a new and convenient method for making purchases, you get an interesting combination that makes a lot of sense.
The players in this case are McDonald's (NYSE:MCD) and NTT DoCoMo (NYSE:DCM). The companies will use DoCoMo's Osaifu Keitai (portable wallet) technology as the backbone of their alliance. DoCoMo will get payment systems placed in McDonald's Japan's thousands of restaurants; McDonald's will enable another form of payment for its customers and use the wallet functionality as the basis for a loyalty-based membership club. McDonald's should also gain the ability to market itself to DoCoMo's 52 million customers (about 40% of Japan's population and more than half of its mobile phone users).
For NTT DoCoMo, the most important benefit is expanding the network of locations where its portable wallet functionality can be used for payment. By adding McDonald's, DoCoMo not only gets placement in another chain with locations throughout Japan, but it gets a big, internationally known brand it can point to as a partner. DoCoMo already counts AmPm, Circle K, and Sunkus convenience stores, Coca-Cola (NYSE:KO) vending machines, and some online shopping sites among those that offer its payment network, but McDonald's is still a very high-profile addition for the company, and one that should help drive other merchants toward partnering with DoCoMo.
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At the time of publication, Nathan Parmelee owned shares in NTT DoCoMo, but he had no financial interest in any of the other companies mentioned. He was ranked 97th out of 23,203 investors in Motley Fool CAPS. Coca-Cola is a Motley Fool Inside Value selection. The Motley Fool has an ironclad disclosure policy.
