What is a QR Code and Why is it the Future of Mobile Marketing?

A weird barcode, one of those hidden picture puzzles, modern art – all common responses when asked to identify a QR, or quick response, code. QR codes are already commonplace in Japan and South Korea. Many believe they will be a key cog in the future of U.S. marketing. So what are they?

A QR code, for the record, is a certain type of two-dimensional barcode, which consists of black and white squares composing a larger square. When scanned by a QR code reader – most often a smartphone app – the QR code transmits encoded data. In marketing campaigns, the data is often text or a URL link to a webpage or video.

But the fact remains, "Nobody knows much about them," said Derek Johnson, CEO of a text message marketing company, in a podcast with Social Media Strategist Heidi Miller. "Nobody knows how they operate in an advertising campaign. There’s no real best practices."

A recent CNN article, however, discussed the various QR code marketing efforts that are taking off with established corporations, such as Macy’s. QR code advertising took off after marketers recognized the power of SMS text messaging campaigns. Twenty percent of Fortune 500 companies now use QR codes in some fashion.

"The ‘text to win’ SMS campaigns have been very successful, and that’s the trigger for QR codes," Matthias Galica, CEO of QR code platform ShareSquare, told CNN. "Something like getting a coupon through a QR code is a powerful call to action."

QR codes cater to smartphone users, who must download an application, such as Redlaser, which uses the camera’s phone to capture the QR code’s data. Groupon and Living Social, daily discount sites with corresponding mobile coupon apps, got smartphone users accustom to getting mobile discounts, paving the way for QR codes.

Now, QR codes are found in posters, storefronts, print ads, movie ads. The movie "9" was marketed with posters featuring only a large QR code linking users to a new trailer. New York City placed a QR code in Times Square, linking to Notify NYC, the official New York emergency events and services site. Several months ago, Macy’s began embedding a QR code in its trademark red star and added a QR code to each sales associate’s lanyard. The code took users to a "Backstage Pass" landing page with unique content – videos of known designers, Martha Stewart decorating a cake, etc.

"It’s one application that can speak to customers across so many vehicles," Holly Thomas, vice president of media relations at Macy’s, told CNN. "QR codes are such a sensible way to send content with immediacy."

But the fact remains – not many people know what QR codes are.

"How I look at QR codes is we’re still very early on adoption in the U.S.," Johnson said. "I read a study that QR code growth was 800 percent in the last year, but if you go to anyone not in the tech world, they probably won’t know what it is."

Which has led to speed bumps in effectively using QR codes. Consumers expect a high value of return if they choose to scan a QR code. A Baltimore social-media marketing company reported in February that 32 percent of survey respondents had scanned a QR code, most – 53 percent – to get a coupon or discount.

A QR code can seem invasive, like a text message, Johnson said, thus people don’t want to scan a code to simply get more info or trivial Twitter and Facebook updates. They want value. A QR code can even compose a text message on a user’s phone for them. Marketers must be wary of delivering an adequate tradeoff for the perceived invasion.

Rapper Lupe Fiasco got a large crowd to converge on Union Square in New York City after a mysterious Tweet. At the end of a laser light show, a QR code appeared on the wall of the building, linking fans to a site to pre-order the artist’s new album. Many attendees left disappointed at the lack of value the link offered.

"You have to be careful not to make [QR codes] the center point of a campaign, but an addition," Johnson said. "In the future, I think they will be huge – the next wave of mobile. Right now, it’s hard to make a link between a piece of paper on the wall and your phone.

In Johnson’s opinion, 2-5 years remain before QR codes are commonly understood and utilized. While only 30 percent of Americans currently own smartphone, 70 percent of all new mobile phone purchases are smartphones, bumping that number well over half of the U.S. population in a few years.

"It’s just going to get more and more interactive," Johnson said. "Then the QR codes will be more in play than they currently are."

For now, though, QR codes are unlikely to generate significant revenue. But they are a rare marketing tool where usage is simple to track for each campaign and can convey the cleverness of a company.

"QR codes may not give the best immediate returns of investments, but they can tell a prospective buyer how cool and hip your company is," Rich Brooks, CEO of web design and internet marketing firm Flyte New Media, told CNN.