Tocquigny - A Measured Approach

The Next Frontier: Mobile Advertising and Web Optimization

Posted 10.26.2010 by Luke Bone

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Over the last decade, the shift from traditional advertising to online advertising has fuelled the growth of interactive agencies like Tocquigny. Another recent dramatic shift in budgets to mobile advertising is a wake-up call for agencies and advertisers to redefine their approach to building websites that include more than the “traditional” Web.

Is mobile stealing wallet share from traditional budgets or even “traditional” online budgets? One could argue the case using these recent stats: According to a survey by the Mobile Marketing Association (MMA), from 2010 to 2011, mobile marketing budgets will increase by 124%. Comparing that to other channels, digital as a whole is increasing 30–32%, while TV spending remains flat, at 16%. Outdoor is dropping by 26%, newspapers by 25%, and DM by 18%. Furthermore, according to a recent survey by J.P. Morgan in June, mobile budgets are projected to continue this pace into 2012, more than doubling 2010 budgets to $566 million.

What’s behind this dramatic change? Not surprisingly, iPhone and Android sales top of the list, but what are the other top factors influencing the growth of mobile advertising?

User Behavior and Expectations

Of course, we should start with the consumer. The expectations of today’s on-the-go user are changing, and our ability to deliver a user experience that matches those needs must keep up. These users are already captive and engaged, so the resulting opportunity to make a substantial impact by producing a great mobile experience is crucial for all marketers.

Google vs. Apple

As seen by the strategic purchase of ad networks AdMob and Quattro by Google and Apple respectively, both companies saw this growth opportunity long before the rest of us. In a recent article, Mashable points out that each corporate giant has an angle, with Google betting on mobile Web and Apple betting on the apps.

Apple had a head start on Google — it had a larger market share and a rabid fan base to launch its mobile platform. But Google has been in mobile for a couple years now with AdSense, and already has an established relationship with advertisers.

Since its introduction earlier this year, iAd, Apple’s advertising platform, has experienced slow growth due to a high barrier to entry and the focus on high-end ads within apps for advertising. With Android’s recent massive growth fueling the other side of the equation, you can count on significant R&D investment in mobile by both sides.

The takeaway here is that this friendly competition is also spurring the growth of the mobile advertising industry as a whole.

 

HTML5 and Mobile Rich Media

Speaking of Apple, their public battle against Flash and the push for HTML5 will definitely impact the user experience in mobile advertising. Way back in 2005, the first mobile ad networks started to pop up, but since then, the basic mobile banner ad hasn’t changed much.

HTML5 will alleviate many of the technical barriers for developers to enter the space. Another articlefrom Mashable highlights the “5 Ways HTML5 Is Changing Mobile Advertising” for the better — including the upcoming drop in the barriers to entry for mobile developers, mostly in the areas of development efficiencies, flexibility, speed, and measurement. It also mentions the continued need for more standards in cross-platform rich media.

As HTML5 gains adoption this year and next, look for more mobile-specific interaction with ads, including video, search, click to call, and maps.

 

The Mobile Inbox

While social media is seeing large increases in mobile use, we should not forget about the importance of email. A recent study by Nielsen shows that the majority of mobile time — 41% — is spent in email.

 

There is no doubt that the email industry as a whole is coming to terms with the growth of mobile. This is inspiring providers and marketers in general to improve the overall mobile email experience from the mobile inbox to the click-through destination.

Social media has a head start in mobile; for the most part, it comes out-of-the-box with mobile optimization for messages. For email, both the email and the destination need high customization to deliver a solid experience.

If your message ends up in someone’s mobile inbox and you don’t have a mobile-optimized destination, you are dead in the water — to that user at least. Email marketers are facing relatively low response rates to begin with, so every interaction and click is precious.

The Mobile Effect on Retail

Mobile search is also expanding at a rapid rate, not just for information, but also for local retailers. A recent Google blog post points out that 54% of users who shopped online but purchased offline used their mobile device to conduct that search. The iPad and many other entries in the tablet market are also causing this shift, as more and more consumers will be surfing not from their desktops, or even notebooks, but from their other, larger mobile device.

Now add mobile barcodes to the equation. More and more users are tapping into the power of their personal barcode scanners. In a trend report [pdf] from September 2010, ScanLife reported a spike in mobile barcode scanning in the last year.

 

Now that consumers are using their devices to price-shop “offline,” retail marketers need to keep their eye on this movement. While barcodes may not have a huge effect on mobile advertising the way we see it today, the future will most likely show that proximity-based ads will throw bar-code scanning into the mix.

 

Performance

This is where we as marketers need help. Sure, the ads have a great click-through rate, but then what? With less clutter and banner blindness and more ownership of ad space, we need to support this mobile evolution by providing a better place to land after the click.

In the past, mobile has been greatly constrained by many factors, including the fragmentation and a lack of standards in the mobile industry, privacy concerns, and a lack of mobile ad networks — until now. However, in my opinion — formed from 10 years of experience in direct response advertising — the most important obstacle has been the poor post-click conversion and the resulting impact on efficiency metrics related to ecommerce and lead generation. One of the primary drivers for this is non-optimized pages and forms.

 

Conclusion

While these problems are quickly becoming history, marketers need to adjust their mobile focus from apps and pick up the pace on mobile Web optimization to provide consumers a better basic mobile Web experience. So much focus has been paid to apps that marketers have been distracted from this bigger long-term opportunity.

A great example of a champion in the mobile optimization space is Taptu. Visit their website from your mobile device, and you will be served a great list of the early adopters of “touch-friendly” mobile websites. As we head toward the end of 2010 — “The Year of Mobile” — keep your eye on the trends in mobile advertising and mobile Web optimization. Push your agency peers and advertisers to get ahead of the curve and avoid losing opportunities to others that embrace the next big wave. Review other predictions, tips, and trends in mobile, and work on your mobile web strategy.

 

The consumers are already there…waiting for a better experience.

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