By Egotist / /
If you missed Ad:Tech, you missed Jeff Cotrupe, Global Program Director of Stratecast, moderate a panel called Finding the Right Mobile Marketing Mix. But Jeff was kind enough to recap the entire discussion for us at the San Francisco Egotist. So read on and learn.
The recent ad:tech event held here in the Moscone Center West featured a panel discussion entitled Finding the Right Mobile Marketing Mix. Moderator Jeff Cotrupe, Global Program Director of Stratecast, and panelists from session sponsor AT&T, Digby, Starz and OgilvyOne tried to help attendees do just that with data and case studies on mobile marketing. To borrow an entertainment programming term, the session had a strong lead-in, closely following the ad:tech keynote by Ariana Huffington of the Huffington Post.
Cotrupe told attendees that for the better part of a century advertisers have paid a premium to place advertising in traditional media, assured by broadcast ratings and magazine readership statistics that their messages were hitting the desired targets. With the explosion of media choices and the resulting audience fragmentation, brands are now demanding far more precision and quantifiable results in exchange for their advertising expenditures.
Cotrupe said the global mobile revolution may provide one solution: a pool of potential respondents who have a more personal and direct connection with their mobile devices than any other advertising medium. Recent Stratecast research indicates there are approximately 291 million mobile service subscribers in the U.S., and estimates of mobile users worldwide vary from 4.1 billion to upwards of five billion. Between 750 million and one billion people on planet Earth accessed the mobile web in 2010 and mobile devices are fast overtaking desktop and laptop computers as the preferred way to the web. Nearly 20% of mobile subscribers around the world have access to fast mobile web (defined as 3G or better). He said users worldwide sent more than 6.1 trillion SMS (short messaging service) and MMS (multimedia messaging service) messages in 2010.
Mobile advertising: what it is…
The next area of discussion was the forms mobile marketing and advertising take, which include display or search ads; SMS/MMS messages; mobile apps, including both branded and sponsored apps; multichannel ads, including ringback tones and call alerts; home screen ads; mobile video; and location-based services (LBS): messages, ads and/or coupons that pop up depending on a user’s location. Panelist Digby noted that LBS normally works based on GPS relative to areas or streets, but that LBS is now going in-store, as some retailers are beginning to launch in-store communications with shoppers to greet them and let them know about special offers.
…and where the money is
Cotrupe noted the global market for mobile advertising is currently about $2 billion (with about half of that going to Google). He said the mobile advertising market has plenty of upside given that the overall online advertising market is approximately $55 billion, and even that is a fraction of the total global advertising market—including every measurable advertising format including broadcast/cable, print, outdoor, direct mail and more—that currently stands at $600 billion. Frost & Sullivan, Stratecast’s parent company, is forecasting that by 2015, mobile advertising revenues in the U.S. alone will grow from $491 million to $2.04 billion, thus exceeding today’s global mobile advertising revenue. Mobile commerce (m-commerce) is expected to reach $119 billion in total transaction value in 2015. By then half the world’s mobile subscribers could be making m-payments, and mobile ads could be inserted into m-payment systems.
Cotrupe struck a cautionary note, however, saying that as attractive as that global user pool may be, much of the mobile marketing mix—beyond the search and display ads users see simply by virtue of surfing the web—relies on getting those users to opt in (agree to receive advertising messages). Thus it is crucial and ethical to provide users with valuable information they truly want in exchange for opting in, and to never misuse their information. He said abuses of user trust such as those identified in a Wall Street Journal investigation earlier in 2011—where many of the top 100 mobile apps were obtaining/distributing some form of personal data without notifying users—could prove fatal to all forms of mobile marketing if they were to continue. Cotrupe noted that by YE2010 uses had downloaded more than 11 billion apps from the iPhone Store and Android Market.
The mobile marketing/advertising ecosystem
Cotrupe next described Stratecast’s view of the mobile advertising ecosystem. Brands work with advertising agencies to determine the optimal advertising network(s) for their content. An advertising platform connects agencies and networks with publishers (website operators) and/or with mobile operators and communications service providers (CSPs). Some platform providers also offer supporting services such as advertising sales and/or operations, which can include selling and booking the advertising; management and optimization; billing and invoicing; and analytics, business intelligence and reporting.
He told attendees that operators (such as panel sponsor AT&T) are in a brave new world where they are no longer the center of their own universe as may have been the case 50 years ago. Brands do not necessarily set out to reach “the BT or AT&T subscriber base;” instead they want to reach, for example, “mobile users ages 16-34 in a specified region who have recently purchased electronics.” The rest of the mobile ecosystem is focused on bringing together mobile users across multiple operator networks to achieve this kind of target focus.
On the other hand, operators provide the networks where subscribers access all mobile content. They are the ones who hold what many in mobile advertising refer to as the “inventory”: the users/subscribers who make up the advertising audience. Operators also have rich personal data on subscriber demographics and behaviors, the LBS servers upon which LBS services are distributed, and a ready-made channel to reach all subscribers: their text messaging inboxes.
Mobilizing your content: the mobile storefront
The first question Cotrupe put to the panel was on the mobile storefront, the importance of effectively mobilizing your content. Starz was the first TV content provider customer for AT&T’s barcode services, so Jennifer Schouten, Vice President, Affiliate Marketing, Starz Entertainment, shared how that came about and gave some perspective on what this all means for Starz and the mobile marketplace, including a mini-case study on a mobile/interactive campaign just launched to promote Camelot, an original series by Starz.
Strategic approaches and best practices for engaging consumers
Next question was on how to best engage mobile users. Phil Buehler, Senior Partner, Head of Planning, OgilvyOne, discussed the types of consumers most likely to respond to mobile marketing and other indicators of mobile user behaviors, tendencies and anticipated responses.
From mobile marketing to M-commerce: focus on transactions
Next question was about how all of this mobile marketing and advertising translates into transactions. Dan Lowden, Vice President of Marketing, Digby, whose Digital Mobile Commerce platform is now powering sites and campaigns for retailer customers of AT&T and other operators, discussed the impacts of things like Near Field Communications (NFC) on mobile marketing processes. On a simple device level you can use NFC to configure Bluetooth or WiFi connections, but much more interesting are some of the consumer and business mobile commerce (m-commerce) applications it can support such as mobile payments, mobile ticketing, area and in-store LBS, and QR (quick response) barcodes. Brands are increasingly using barcodes so when consumers swipe the barcode it can take them to a landing page, provide special offers, in-store savings and promotions, or all of the above.
Focus on privacy, too…or the mobile marketing house of cards can come tumbling down
Next question was about steps the industry is taking or needs to take with regard to privacy. Cotrupe said that when we all learned earlier this year that most of the top 100 mobile apps (ranked by user downloads) were collecting and distributing some form of personal user data without user knowledge, it may have seemed peripheral, but mobile apps (including branded and sponsored apps) are becoming more and more attractive to brands as a great way to create engagement and involvement. So any abuse of user trust can hurt anyone with a stake in mobile marketing.
Robert Russell, Director, AT&T Mobile Marketing Solutions, said that to AT&T mobile users are the most important part of the mobile marketing mix—but that they are first and foremost AT&T customers, and that the company is not about to risk customer relationships upon which its revenue base is built. Russell said AT&T safeguards customer data and has decades of experience safely maintaining customer proprietary network information (CPNI) as mandated by the Federal Communications Commission (FCC).
My fellow panelist, my partner
Cotrupe mentioned the agreement announced just two days prior to the session between panelist Digby and session sponsor AT&T whereby AT&T will offer the Digby Mobile Commerce platform to AT&T retailer/etailer customers. The move is designed to help AT&T retailer customers design, deploy and manage websites and smartphone apps incorporating sales mechanisms, product information, reviews and promotions. Cotrupe, who just authored a Stratecast report entitled Mobile Advertising Building Blocks, said the move represents a serious challenge to leading vendors in the customer experience management (CEM) space and that Digby now has a major new channel to retail customers: AT&T.
Cotrupe said the Digby partnership is another example of AT&T continuing to build its capabilities in mobile marketing infrastructure, citing AT&T’s acquisition of leading mobile app development platform Plusmo in 2009.
Jeff Cotrupe is a Global Program Director at Stratecast, a division of Frost & Sullivan. You can connect with him on 100 social sites/web venues at http://xeesm.com/JEFF.