It is an unavoidable discussion – the economy is bad and one starts to question the untried. If you read the Financial Times, you cannot help getting the feeling that the article kind of implied that 1) mobile is not providing significant returns and 2) operators are making significant investments in mobile advertising. Both are not true. Mobile advertising today is far from significant, but is growing, and will continue to grow. The ROI on mobile campaigns have been quite high in many cases, but must not be seen in isolation but as part of an overall integrated campaign.
They are probably right in that growth will slow, but good ad campaigns will still launch in a tough economy, even on mobile. Further gloom was cast by Moconews and the WSJ. Especially this quote got my attention: “We won’t experiment in a lot of things that are fun to have. All of our dollars have to go to hitting in-market shoppers with the appropriate media,” Chrysler’s CMO Debarah Meyer told WSJ”.
Reading this, it seem it is clear that the mobile marketing industry has a major problem if the selling point for mobile marketing is “fun”. The two articles really only shows ignorance towards the concept of mobile marketing. On the advertising side, I am not at all surprised that ad inventories are not getting full, because serving banner ads in an interactive device simply is not very compelling, especially since CPMs are so much more expensive than online. You need to have campaigns that engage the user, and use the interactive capabilities on the phone. Serving an ad does not fulfill that requirement.
So yes, no doubt that there will be a downturn in CPM based campaigns (or even simple CPA based campaigns). What mobile marketing needs – whether in a downturn or not – is compelling campaigns that engage the user and with results that can be measured. There have been plenty of these campaigns around having been successful with SMS based interaction and simple wap sites. What will truly open the eyes of the market though, are more multimedia based campaigns that spans web and mobile in a seamless experience. This is big part of what we are working on at www.storyz.com in terms of our advertising/sponsorship strategy, where users can earn loyalty points by signing up to sponsored campaigns, and their posts will be branded in a non-intrusive way.
Interestingly though, Sequoia’s commitment of nearly $16m in AdMob certainly seems like a nice vote of confidence in the concept of mobile advertising. I posed the question of the possible death of mobile marketing to a number of industry colleagues. Aside from our natural industry bias, the consensus was pretty much that although some contraction in spending is likely to occur, we may actually see increased spending as mobile provides higher click through rates, better reach and more interactivity than the web. However, a lot of emphasis was given to the fact that campaigns need to be measurable so that ROI can easily be calculated.
If you read my article clippings you will see a number of articles confirming this view. And although there have been negative articles forecasting the death of mobile marketing, there are numerous more being upbeat about the mobile as the channel. I tend to agree – we may see a slight downturn, but the mobile as a marketing vehicle, providing the perfect personal extension to an integrated campaign – is both proven, here to stay, and will grow massively in the years to come.
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