Transaction processing services provider SelectCore (CVE:SCG) said Wednesday that it has signed a letter of intent with iSIGN Media Solutions to build out the largest retail mobile proximity-advertising footprint in North America.
Under the terms of the agreement, iSIGN and SelectCore are planning to embed iSIGN's patent-pending Interactive Marketing Solution 3.1 software and its newly developed Smart Antenna into SelectCore's Verifone Point of Sale terminals in up to 7,000 convenience and grocery store locations throughout Canada and the United States.
Based on previous test installations, iSIGN has the ability to reach an average of approximately 1,000 mobile devices within proximity of each of its installations. This reach would result in the Smart Antenna contacting approximately 7 million viewers daily, iSIGN said.
The size of this reach makes the mobile advertising method cost effective to potential advertisers in comparison to television, radio, papers as well as more traditional direct marketing.
As a result of the size the reach, the expectation is that a full network roll-out has the potential to generate at least $10 million in revenue annually from advertising and Anonymous Mobile Analytics data per year.
Of the $10 million in advertising revenue, SelectCore will retain 80% and iSIGN 20%, the comapnies said. The length of the agreement will be three years, with an automatic renewal period of an additional three years.
"iSIGN's technology allows us to monetize and maximize the value of our retail point-of-sale network and access to a market of millions of consumers with mobile phones," said CEO of SelectCore, Keith McKenzie.
"Aligned with our growth strategy, this partnership has the potential to generate a new, high-margin revenue stream with virtually no capital expenditures."
iSIGN's CEO, Alex Romanov, added: "This opportunity came to us from the announcement regarding the Couche-Tard/Mac's Convenience Stores network and installation. We believe that this is a tremendous opportunity for us to build-out a second advertising footprint, similar to the Couche-Tard model."
iSIGN said it expects building the network with the Smart Antennas will cost around $1.05 million in capital expenditures.
"This installation will provide our initial entry into the US market, in addition to expanding our national coverage in Canada, making the network very appealing to advertising agencies and national brands," added Romanov.
Established in 1999, SelectCore is a provider of transaction processing and point-of-sale solutions for the prepaid telecom market and prepaid financial services sector. The company's shares soared over 20% to close at $0.175 on Wednesday.