Scope

“Mobile Internet – Delivering on the Promise of Mobile Advertising” represents the first in a series of white papers from Yahoo! that provides an overview of the mobile landscape, explores the potential of emerging applications and explains mobile capabilities to marketers looking to integrate mobile into their advertising campaigns. This paper discusses mobile and tablet usage, delivers insights about mobile advertising effectiveness, presents real world case studies and details current best practices in mobile advertising.

Executive Summary

Mobile Internet came of age in 2010, offering advertisers the scale, tools and technology to develop effective campaigns and vie for a fair share of major media budgets. However, mobile advertising still lags behind the opportunity. Will brands realize the full potential of mobile in 2011? To do so, marketers will need to approach mobile as a channel, not a strategy, albeit a particularly effective channel due to its ability to connect with consumers in a very personal way.

If it feels like mobile phones are everywhere, it’s because they are. More than 80% of the U.S. populationvii owns at least one mobile phone. Unusual in the world of consumer electronics, mobile users express intense feelings about their phones, describing the devices as a seamless extension of their person and psyche.

Faster network speeds, functionrich smartphones and tablets, a burgeoning portfolio of applications and more engaging ad formats like screen takeovers and expandable ads enable mobile to compete with more established media. As for mobile’s position in the media rankings, the facts speak for themselves. Mobile attracts younger, more affluent and more educated consumers and delivers on performance benchmarks such as awareness, message association and purchase intent.

Perhaps most importantly, mobile effectively moves consumers through the marketing funnel from awareness to purchase, repeat buys, and advocacy. Half of consumers claim they purchase an item after researching it on their mobilexii and 90% of mobile owners access the web from the retail store floor.

Mobile functions most effectively in an integrated media environment coupled with online display. This combination amplifies budget efficiencies and achieves synergies that increase key metrics like awareness and purchase intent. Integrated mobile and personal computer (PC) campaigns resulted in a 54% increase in brand awareness, a 46% increase in brand favorability and a 42% increase in aided brand awareness.

Mobile has proved itself a most adaptable medium, facilitatingquotidian tasks like shopping, checking bank balances, locating restaurants or stores, navigating routes, monitoring health, paying bills, downloading music and videos, texting friends and yes— making phone calls. Consumers have embraced smartphones with open arms and mobile Internet has finally reached enough scale to offer critical opportunities for marketers.

Now, tablet computers have emerged as a potential contender for screen dominance. Experts credit the iPad launch with singlehandedly reinvigorating the tablet market. Penetration projections show a growth trajectory from 10.3 million tablet users in 2010 to 82.1 million by 2015. The turning point occurs in 2012 when tablet sales (36% of U.S. PC sales) should outstrip those of notebooks/mini PCs at an estimated 32%.

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