South Korean mobile operator SK Telecom has signed a partnership agreement with Japan-based The Pokémon Company to roll out joint marketing initiatives. Together, SK Telecom and The Pokémon Company will promote the AR (augmented reality) technology-based mobile game, according to a news report. SK Telecom said its 4,000 official retail stores throughout South Korea will serve as “PokéStops” where users can obtain virtual items and “Gyms” where they can engage in gaming battles using the Pokémon characters.

In cooperation with the U.S.-based AR software company Niantic, developer of the Pokémon mobile game, SK Telecom will enable its customers to play Pokémon Go without using their monthly data through the end of June. The company said the decision was made because younger game players are usually subscribers to cheaper data plans.

Tarifica’s Take

We have written frequently about mobile operators partnering with entertainment content providers in order to strengthen their brands, increase retention, or even directly drive revenue. This three-way partnership between an operator, SK Telecom, and both a content provider and a software developer, while it does not provide exclusive access to premium content, is nonetheless a creative plan that is likely to deliver benefits to all parties.

For the operator, the Pokémon agreement would achieve the following: First, it would associate SKT’s brand with that of a hugely popular, multi-platform pop-culture phenomenon. While most mobile co-branding takes place only through mobile devices, this plan to create play centers within SKT’s 4,000 physical stores adds another dimension to the cross-promotion and increases visibility. Because this visibility is at street level, it would also have the ability to attract a large number of potential customers who are not yet SK Telecom subscribers and thus could aid with acquisition as well as retention.

Second, by zero-rating Pokémon game-play data, the operator will be encouraging rapid uptake of the service. Since this is a relatively short-term data promotion, it is to be expected that after it ends, the operator will be able to convert a fairly large percentage of the trial users to long-term ones who will pay for the data needed to play the games. And since AR requires a large amount of data, this could prove particularly profitable. Given the addictive nature of mobile gaming, its power to upsell users will likely be strong. SKT is also smart to target the youth market with this offering, given the over all importance of early cultivation of this rapidly growing and data-hungry—though temporarily budget-minded—demographic.

Third, associating itself with cutting-edge technology such as AR is yet another good way for SK Telecom to burnish its brand and stay up to date.