Hold The Phone! - Third Screen Media
February 2007, Written for the MMA Mobile Messenger

In A Publisher’s World Mobile Advertising Reigns Supreme

In November, Third Screen Media’s “Hold The Phone!” column introduced the mobile advertising ecosystem by highlighting the evolution of the industry.  In the coming months, we will take a closer look at each of the major players involved—including carriers, agencies and advertisers, technology providers, publishers and the mobile subscribers—to show how each entity affects the industry and what part each will play in the overall growth of the ecosystem.

For our first ecosystem profile, we’ll look at the integral role of the publisher. As we mentioned back in November, in every ecosystem there are costs associated with delivering value and for mobile content providers the good news is that advertising revenue can offset these costs.  In addition to WAP sites, publishers are now exploring the viability of video and downloadable applications as advertising vehicles. With all the attractive possibilities, publishers are looking forward to a variety of off-deck and on-deck advertising revenue opportunities, along with the need for scalability, ad standards and creative executions that will delight and entertain the consumers in the ecosystem.

This month, we sat down with <?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" />Matt Jones, director of mobile strategy and operations for Gannett Digital—which includes Gannett’s 113 domestic local print and broadcast properties and USA TODAY—to get the publisher’s perspective on the mobile advertising industry.

Q: How would you describe the mobile market as we move into 2007?
A: Right now, an ever increasing number of traditional publishers are eager to extend their properties and content into the mobile environment.  This willingness to explore the mobile advertising ecosystem has resulted in a marked increase in mobile-ready content of all types.  The market continues to expand, and that’s in advance of even more, soon-to-be more widely distributed capabilities that show tremendous promise…like search, local and video applications, to name a few.

USA TODAY has contributed considerably to the growth of mobile advertising by making steady gains in enlisting new advertisers to this new medium. We have consistently maintained above industry average click-through rates for our inventory.  So not only are we seeing an increase in size and popularity, we’re seeing first-hand that the medium is really working and consumers are truly warming to navigating the mobile Web.

Q: What has helped you be so successful thus far?
A: USA TODAY is one of the most well-known and well-trafficked sources of news and information in every medium we enter: first print, then online, and now mobile.  Part of it is the overall strength of our brand.  Another part of it is building and partnering to produce innovative products that meet and exceed the demands of our users. 

Q:  Are you subscription based?
A:  While our print version is based on subscription and newsstand pricing models, our mobile Web site is entirely ad-supported.   Likewise for our text offering where we partner with 4INFO.  We do sell USA TODAY Mobile Sudoku—an extremely popular game title—under a subscription plan.

Q:  Have you considered a subscription model for news content?
A:  We considered this option several years ago and determined that the audience would be limited by a subscription.  Mobile phone users already pay several subscriptions for ring tones and other content on top of their data plan fees.  There is a limit to the number of subscriptions that a consumer is willing to pay.  We believe that in the long run, we are attracting more users to our content with an ad model.

Q:  What is the benefit of the advertising model?
A:  The biggest benefit around mobile advertising is it allows us to produce, maintain and continually enhance products, like our mobile Web site, without charging a subscription to our users.

Q:  Have you seen an increase in traffic on your mobile site over the past year?
A:  All our mobile efforts (mobile Web, text messaging and games) showed significant traffic gains in 2006. All our usage metrics, such as pageviews, sessions and unique users, showed year-over-year gains up several hundred percent.

Q:  On-Deck or Off-Deck?  Which has seen the most growth?
A:  USA TODAY is lucky to posses a widely recognized brand, which is often viewed as an essential read for a mobile or traveling audience.  Customers know they are going to get a consistently great user experience on all our platforms (print, Web and mobile) and that has paved the way for our off-deck gains.

Q:  How do you build the on-deck carrier relationships?  Do you have dedicated staff to manage the carrier relationships?
A:  All the major carriers are partners with USA TODAY.  We don’t have dedicated resources for that area of our business, but nonetheless we spend a good deal of time working to maximize the relationship for both sides.

Q:  What tactics are you implementing to promote your mobile content beyond the on-deck carrier links?
A:  We have dabbled in a few other promotional tactics, including sponsoring trade events like CTIA, print advertising and applications like “wap push” via a short code (Text USA to 59523)  Our main objective here is customer awareness of our mobile offerings.

Q: Where is the mobile advertising industry headed?
A: Mobile is a powerful medium, but it’s still young.  Like any young medium, it’s going through growing pains and needs more widely implemented and understood ad standards, more inventory, more advertisers and a greater diversity and creativity of ad units.  It took the online world years to develop these standards, but people want and expect the same for mobile…right now.

I also see an increase in demand for direct-to-consumer advertising to promote off-deck content.  More brands in a variety of industries (automotive, travel and consumer packaged goods) will build persistent mobile sites. Moving forward, you’re also going to see for a demand for advertising rights agreements with wireless carriers.  The medium is growing fast and it’s going to have to grow up fast, too.

Look for the “Hold The Phone!” feature again in March as we highlight another major player involved in the mobile advertising ecosystem, the advertising agency.  As more brands realize the reach and reward of a well-developed campaign, the role of the agency becomes ever more important for those companies seeking a larger mobile presence.<?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />