The Co-operative Group has signed up to O2 Media's You are Here location-based marketing service.

The Co-op is the first major UK supermarket chains to take advantage of the O2 service, with O2 customers within 0.5 miles of a Co-operative food store now receiving a text message offering them a free 500ml bottle of Dr Pepper.

All O2 customers are part of O2 More, one of the mobile industry’s largest marketing schemes with over 2 million members, although O2 customers can opt out of location-based marketing.

You are Here uses "geo-fences" which are set up around a particular location, in this case a Co-operative food store. As soon as a target customer enters the area marked by the geo fence they automatically receive an SMS or MMS (multimedia messaging service) message with the offer.

They then simply show the message at the till in the nearest store to redeem the deal. Any phone can be used to receive the messages - users do not need an advanced smartphone.

Sean Toal, commercial director for The Co-operative Food business, said,“The Co-operative is keen to make use of cutting-edge technologies, and mobile proximity marketing means we can target customers with specific offers and engage with them directly.

“The Co-operative has almost 3,000 stores nationwide which makes this initiative and technology ideal for us as a community retailer.”

According to a Pew study, only four percent of online adults in the US use location-based check-in services like Facebook Places or Foursquare.

However, for the market of location-based marketing efforts, users who go online with a mobile phone nearly double that number to seven percent.