Mobile to beat all advertising odds
Russell Buckley, Managing Director, AdMob

Despite the popular belief that mobile advertising is a new kid on the block, it’s actually been around for almost ten years in one form or another. However, it’s only recently been delivering on its promises and the consistent ROI desired by marketers.

The first forays into mobile advertising were via Push SMS alerts. Marketers figured that if you could send the right message to the right person at the right time, this would be an effective call to action.

But there have been issues with this approach. Firstly, outbound SMS is expensive in relation to the response rates often generated. Secondly, even with opt-in permission, messages received at the wrong time are frequently regarded as little more than spam.

In addition, there was the whole creative issue of restricting the experience to SMS. While a text message can connect emotionally, the opportunities for marketers are somewhat limited. It suits an offer-led approach, while pure brand messages are hard to paint in text only.

The next phase of mobile advertising was more successful with SMS helping consumers ‘pull’ information from other channels. Consumers would enter a competition or vote in response to a TV programme, download a ringtone or request more information from a poster. This approach has proved more successful and is still growing very quickly. Now it’s only a matter of time before SMS short codes become as important an element of advertising as including the website address.

The mobile internet

However, it’s the growth of the mobile internet that will mark the next big step in mobile advertising.  The mobile internet has really taken off in the last 12 months, with 29 per cent of <?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" />UK mobile owners using it, according to analyst firm, M:Metrics.  But with connection speeds getting faster slicker handsets making for better usability and the promise of fixed price data packages starting to be introduced, this figure could easily be dwarfed very quickly. To millions of people it’s also more readily accessible than a PC and, therefore, actually their preferred method of browsing.

For advertisers, this presents an opportunity to deliver highly efficient and measurable advertising similar to that conducted online. If we look at the kind of advertising that consumers could browse on their mobiles, the problems of first generation mobile advertising disappear. There is no high cost of messaging and it can’t be confused with spam as we’re asking consumers to click if they’re interested.

Today we can use text links and banners, with richer graphics, images and eventually audio and video round the corner, once fixed rate browsing is more widespread.   

Like the PC-web, the mobile web is also a global opportunity. When you put up a mobile web site, it’s accessible from all over the world and will be found and used by people everywhere.

So what kind of advertisers are already taking advantage of the mobile web as a marketing channel?

Firstly, as you might expect, it’s companies that are trying to sell content and products related to the mobile itself. This might range from operators and handset manufacturers to ringtone and games retailers, as examples. For these advertisers, it’s a no-brainer to advertise in this new channel and stories abound of ROI’s in excess of 4 times that they enjoy online.

But the other much more mainstream group is major blue chip brands themselves. Just as we saw a rush to build websites back in 1995/6, so we’re seeing marketers realise that if nearly a third of their potential audience are already using the mobile web, they need a presence there too. And once they’ve built a site, they need to find a cost-effective way to promote it.

The future

The future of mobile advertising lies in a company’s ability to take advantage of high traffic mobile web sites through Pay-Per-Click business models.  For most mobile web sites this offers new revenue streams and a profitable business model.   The most cost effective method of doing so is to reach out to mobile web sites through mobile advertising marketplaces that deliver content from the advertiser straight onto targeted mobile sites.  Here, everyone is a winner.

As such, mobile is bound to outperform, in the same way that the PC web would be the best way to promote a normal web site, over and above any other medium. It’s time to get on the bandwagon or you will miss out. <?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />