Mobile Advertising Holds Promising Future, says IAB Director of Research

Mobile advertising is the key focus of marketers and media agencies around the world. According to a report by eMarketer, by 2012, the worldwide mobile advertising spend will be more than USD 19 billion. While the US is still the most dynamic market, Asia and Europe are getting ahead. The International Advertising Bureau (IAB) recently published a report “A Mobile Advertising Overview” that outlined the opportunities and challenges of creating a mobile advertising campaign. The online telecommunications magazine Telecommunications Online recently conducted an interview with Joe Laszlo, director of research at IAB, on the future of mobile advertising.

During the interview, Joe shared that due to the personal nature of mobile devices, mobile advertising presented opportunity to reach consumers one-on-one in a way that never existed before. He said that even PCs and TVs are shared in a household, whereas mobile is a very personal device. However, he also noted that the challenge is to determine what level of personal communications will fit in a given individual’s comfort zone.

"Because they are such personal devices, the industry is still feeling its way toward the level of personalized message that is the right level. Every consumer will have a different answer. Every consumer has different relationships with different brands. I would say the biggest challenge and opportunity is that this is a one-to-one medium in a way that no medium has seen before", said Joe.

He also said that while mobile operators are playing a key role in helping consumers find content on the mobile Web, they are proceeding a bit more cautiously tapping into the revenue possibilities for mobile advertising. Mobile advertising is still very nascent in developed markets such as the United States. Verizon and Sprint are the only two operators that sell advertisements on their mobile wed pages, according to a Yankee Group report. However, Joe also cited the example of Virgin Mobile USA that is very active in mobile advertising in the US. Virgin has a program called Sugar Mama that offers audio and Web-based advertisements in exchange of reducing a user’s monthly cost of minutes of use.

Sharing the results of the new IAB report, Joe said "Even though mobile advertising has been around in the U.S. for a while, I think marketers and agencies are in the learning phase. Mobile is like the debut of the Internet all over again. You have messaging, text messaging, mobile Web and video. There are as many ways to advertise to a mobile consumer as there are to a consumer on the PC-based Web."

"We have seen evidence that mobile ads can get people’s attention in a branding sense as well. It does not have to be all about getting someone to do something right then and there. It can be about that longer-term relationship a consumer has with a brand."

Joe said that regardless of an advertising campaign’s goals, there is always a way mobile can support those goals. A lot of advertisers are using mobile in that way. Mobile campaigns are still not used as a standalone media activity; it is generally used as one facet of a multimedia campaign, which is an effective way to use mobile.

Taking about the contextual relevance of mobile advertising, he also pointed that the mobile advertising campaign of Hampton Hotels on Weather’s.com generated lots of very good metrics in terms of brand and consumer response to the brand.

Joe believed that a mobile ad campaign can generate strong brand results regardless of age demographic. He said "Another misconception is that it’s all teens or 20 year olds, who are tapping into the mobile Web. Even older demographics of ages 35 to 50 are making heavy use of mobile content. The other campaign we talked about was one run by the movie the ‘Golden Compass’, launched during last year’s holiday season. It ran ads around free mobile game offerings and saw good lift in brand awareness across all age groups looked at."

Discussing the challenges that mobile advertising is expected to face, Joe said that most mobile advertising campaigns today are not significantly targeted. Mobile operators and content providers only target users based on the available demographics of the mobile subscriber of the registered users. He said that there is a lot of talk happening about location-based advertising, however, advertisers need to be responsive to consumers who want to opt out of a location-targeted advertisements.

"I don’t see any insurmountable stumbling blocks around access or use of personal information. For some consumers it’s going to be a prospect worth doing and for others it will be something they will never opt for. I think most people fall in the middle. The industry knows this and it will be cautious to make sure it’s not involuntarily treading on people’s privacy. In mobile text messaging campaigns, you’re starting to see text messaging short codes on the sides of buses, for example. These say for more information send a message to such and such a number. Most of those campaigns have a double opt-in. The end user sends a text message, and the message back (asks) are you interested in this? It’s a double opt-in process to make sure people aren’t accidentally signing up for services they don’t want."

The other option for mobile advertising is opt-in, a case where a user might receive benefits for accepting advertisements. Joe said that free or highly subsidized SMS services will be a great prospect for a lot of consumers. However, he thinks that many business models will be developed that will not offer ad-supported service.

"It’s great that consumers have that choice, and I think they will for a long time to come. I don’t think the market will go entirely one way or the other."

The full interview with Joe Laszlo can be read here: http://www.telecommagazine.com/newsglobe/article.asp?HH_ID=AR_4358

The IAB’s report “A Mobile Advertising Overview” can be downloaded from here: http://www.iab.net/iab_products_and_industry_services/1421/1488/mobileplatform

Source: Telecommunications Online

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