Mobile Marked by Promise, Problems

OCTOBER 25, 2007

Majority of users still deleting ads.

Average mobile marketing campaign prices have increased tenfold since 2005, according to mobile ad software vendor Third Screen Media, as cited in an Advertising Age article. Third Screen also said that the average age of mobile Web users was over 30.

The audience for mobile Web-based campaigns is growing, and more marketers are experimenting with the medium. But many brand managers are hesitant to commit big budgets. "Brand marketers will start spending heavily on [mobile] when the users are there either in sheer mass or enough of the target audience has moved into the channel," said John du Pre Gauntt, senior analyst at eMarketer.

Mobile marketing spending has been on the cusp of a major breakthrough for years. In April 2007, US marketing executives listed mobile as one of the top five media on which they planned to increase spending in 2007.

But roadblocks persist.

A Nielsen study cited in Advertising Age found that only 10% of mobile data users responded to ads on their mobile phones. Another 11% viewed the ads but did not respond, and nearly eight in 10 did not view the ads at all.

More than one-half (53%) of those who ignored the ads said they were not interested in what was being advertised.

More than two-thirds of mobile data users thought that mobile ads were unacceptable. However, nearly 45% of mobile video viewers were willing to watch ads in exchange for an unspecified benefit.

Targeting the right mobile users with the right messages remains a challenge.

Mobile Ad Spending Boom on the Horizon, says Myers

By Fred Aun , September 18, 2007

Slow to catch on, mobile advertising is about to enter its heyday, according to the latest ad spending projection from The Jack Myers Media Business Report.

The forecaster believes advertisers are currently spending about $500 million annually on mobile advertising but will increase that amount by 120 percent next year and reach about $1.1 billion.

The spending won’t stop there, said report publisher Jack Myers. He estimates another 120 percent boost in mobile spending for 2009, meaning marketers will shell out about $2.4 billion to dangle their goods and services in front of mobile device users. According to his forecast, 2009 should be the year mobile advertising draws 1 percent of the $254 billion total ad spend.

“Mobile advertising, in 2005, was at virtually the same level as gaming advertising," said Myers in an interview. “It was growing at a fairly parallel rate with gaming.” However, if his projections prove correct, mobile ad spending will grow twice as fast as game ad spending in 2009.

While it will not come close to the growth rates of either mobile or game ad spending, general Internet advertising -- including search and video -- is still on the rise. Myers projects online spending to increase 20 percent, to $16.7 billion, this year. Similar growth rates should follow, according to Myers: Online/Internet should see 24 percent gains in 2008 and 28.5 percent growth in 2009.

He said video advertising will be the heavy hitter of the online advertising lineup. “Search growth is slowing, but everything to do with video is accelerating,” said Myers. While monetization of YouTube and other user-generated video is a hot topic these days, Myers said the big growth in online video ad spending will benefit large, commercial sites. “More the CBS, Disney professional type video,” he said.

While online advertising is growing, it still amounts to a small slice of overall marketing budgets. “In 2007, online represents 7.2 percent of total advertising and advertising represents 31 percent of total marketing,” said Myers. Noting that online represented only 5.3 percent of total advertising in 2005, Myers predicts it will have doubled to 10.5 percent by 2009.

Myers forecasts overall media advertising will increase 6.9 percent in 2008 and 3.1 percent in 2009, and his report notes categories untracked by some other forecasters, such as cinema, mobile, games, branded entertainment, satellite radio and custom publishing, are expected to collectively grow 20.3 percent this year, 18.4 percent in 2008 and 18.5 percent in 2009.

Meanwhile, Myers projects newspapers will sustain the largest declines in ad spending. He said the papers will lose 4.6 percent in ad revenues in 2007, 2.4 percent in 2008 and 4.5 percent in 2009.”

Report: Mobile commerce to hit $63B by 2010

The mobile commerce industry continues to expand at a rapid pace, with a growing number of consumers using mobile phones to browse, shop and research products. Juniper Research predicts that tickets and retail products sold on mobile devices will generate $63 billion in worldwide revenue by 2010. Seattle Post-Intelligencer

UK Mobile Ads Move Forward

JULY 6, 2007

'Sure I'll click your ad. Give me a ringtone.'

Mobile advertisers who want to reach UK users should offer them free content, according to MoMac's "Mobile Advertising Attitudes" report. The research was conducted in May 2007 by Tickbox. That is similar to other markets, where mobile users say they are opposed to ads on their handsets, but feel differently when offered free content for viewing ads.

Young mobile users were most likely to have responded to an ad, with 13% of 16-to-24-year-olds having done so.

Text-based advertising links on mobile sites were more likely to get a response than other types of ads. Mobile video ads were more popular with men than women. Younger mobile users were also more likely to respond to mobile video ads than were those older than 55.

Nearly 30% of men and 20% of women said they would respond to a mobile ad in exchange for free content.

Sham Careem of MoMac said, "Different demographics will respond better to different methods of advertising and the key to a successful campaign will be ensuring that the format matches the target audience."

Mobile ad spending in the UK is expected to grow quickly as marketers figure out what types of ads work best. GroupM projected a two-thirds increase from 2006 to 2007.

Learn why the UK has one of the world's most developed digital ad sectors. Read the eMarketer UK Online Advertising report.

MMA Updates Mobile Ad Guidelines

MMA Updates Mobile Ad Guidelines
by Tameka Kee, Wednesday, Jun 6, 2007 6:00 AM ET
IN ADVANCE OF TODAY'S START of the Mobile Marketing Forum in New York, the Mobile Marketing Association (MMA) has released an update to its Mobile Advertising Guidelines.
Much like the Interactive Advertising Bureau's universally recognized ad formats, the Mobile Advertising Guidelines provide advertisers with technical specifications and standard WAP ad units (such as banners). Marketers also get detailed explanations of various click-through capabilities, including email opt-in and click-to-call, as well as specific best practices with regard to ad content.
This fourth version of the guidelines includes provisions for mobile Web and downloadable content (such as ring tones and ad-based games), as well as an overview of multimedia messaging services.
Wireless carriers, tech firms, agencies, and content providers comprise the MMA's Mobile Advertising Committee, and they collaborate on the guidelines as a source of standardization in the rapidly growing industry.
"The guidelines are an example of how the MMA leads the worldwide mobile marketing industry by bringing all players in the ecosystem together," said Pete Distler, general manager, Sprint Mobile Media Network.
Later this year, the MMA will deploy a usability lab to evaluate the efficacy of the guidelines, and update them again if necessary. The organization has been working toward developing industry best practices, innovation, and standardization since 2000.

Giveaways Key to Mobile Marketing

JUNE 4, 2007

Would you watch ads for a free phone?

Mobile advertising will generate $2.3 billion in revenues in the US by 2011, according to EJL Wireless Research's "Global Mobile Advertising Market Analysis 2006-2011."

The firm expects mobile couponing to be the largest ad segment, accounting for 42% of the overall market by 2011.

Earl Lum of EJL said, "We believe that the recent transaction involving Third Screen Media and AOL is the tip of the M&A iceberg for the mobile advertising industry and anticipate and recommend a significant consolidation of the industry to create market efficiencies that will eventually lead to explosive growth."

eMarketer's own projections for the US mobile ad market made in January 2007 covered spending, not revenues, and had the market passing $2.3 billion in 2009.

While mobile couponing may be the secret for global mobile marketing, giveaways are the ticket in the US, according to an April 2007 AirG study. Nearly half of respondents said that they would accept ads on their phones in exchange for a free service or chance to win a prize.

More than a third of said they would watch more than 10 ads a day to get a free phone.

Although a free phone or free phone service may be alluring, individual phone applications had less appeal to respondents in a Harris Interactive poll conducted in October 2006. Just over half were not at all willing to watch ads in exchange for applications. The remaining 49% had a slightly negative to neutral reaction to the proposition.