According to a recent survey by CBS News, there are more than 4.6 billion cell phones in the world and the potential for mobile marketing is virtually unlimited. Experts believe that mobile marketing will soon become the most influential advertising medium of all time, surpassing even television.
Even if the term is unfamiliar, mobile advertisements have been in use more than a decade and anyone with a smartphone or tablet computer has seen this type of advertising and probably responded to it.
Mobile marketing started out around 1999 with subscription-based text messaging services that were free to the customer but paid for by sponsors. Since then, mobile ads have blossomed from short text message blasts to detailed ads, complete with video and sound, sent directly to the smartphones and tablets of buyers when they are closest to shelling out their cash. Sometimes the ads reach potential customers while they are standing in front of the product display in the store.
Retail stores are working quickly to capitalize on consumer response to this kind of advertising, and at an unprecedented rate. Data taken this past October by Acquity Group’s 2011 Mobile Audit illustrated a 17 percent increase in the number of retail stores operating mobile-specific websites since 2010. Acquity’s survey evaluates companies and industries leading development and innovation in mobile applications.
Strategy is one thing, but application is quite another and innovation is key. Not long ago, ads heard on the car radio could have been considered “mobile,” but today creating more sophisticated advertisements and delivery methods have tech giants like Google and Apple scrambling to stay a step ahead of the competition. Each offers an advertising program, AdMob and iAd, respectively, designed to directly target potential customers using the “always on” mobile technology. Sometimes, it can take decades for a new process like this to catch on, often failing on the drawing board. But, with the feverish demand for more and better mobile technology, the field has advanced from novelty to practical application in only a few short years.
According to Karim Temsamani, vice president of Google’s Mobile Ads, one of the major mobile computing trends of 2011 was what he calls, “improving the ‘pipes,’” in his December article titled, A Look Back At 2011. The pipes Temsamani is referring to are the, “The systems, products and technologies that advertisers use to build, serve, and measure mobile ads.” Improvements on quality, signal, delivery and service by wireless integrators has only served to increase the response by the consumer to buy more and better smartphones and tablets.
The more devices there are in the hands of the users, the more advertising opportunities there are for business. Some estimates suggest by 2015, more than $163 billion of worldwide sales will come as a result of mobile advertising, in part because of the potential pinpoint accuracy of customer targeting. Utilizing dozens of demographic variables from age to home address, mobile marketers are in the position to build brand awareness far more rapidly than any other medium.
Delivering the messages at just the right moment also plays an important role in strategic mobile marketing and advertisers need a good understanding of when customers make decisions regarding their particular product. A grocery store, for example, is likely to have better results if they send out text message ads on Friday afternoons or Saturday mornings when a larger number of shoppers are either preparing to shop or are already in the store.
Like any other advertising method, however, mobile marketing is not an exact science, nor does it guarantee any particular returns on investment. But it clearly has advantages over previously traditional advertising methods. Marketers are faced with the challenge of developing the right advertisement, choosing strategic keywords that generate a significant number of searches from mobile devices, mainly smartphones.
It might seem like only the seller benefits from mobile marketing, but that’s not the case. Consumers have the advantage of saving money on products and services that they are likely to buy anyway. On-the-spot discounts offered directly, and in some cases exclusively, through smartphones offer shoppers the electronic equivalent of an in-store coupon.
Text messaging is expected to increase from 6.9 billion messages sent in 2011 to more than 8 trillion by the end of 2012. The trend towards increased mobile access to social media networks like Facebook and Twitter is also expected to rise. Advertisers have their feet firmly planted in the trenches of mobile marketing and they’re not likely to change their tactics anytime soon.
Mobile monetary transactions are also increasing the potential for sales. Consumers can get an ad for an item on their smartphone, touch the screen a few times, and the product is on its way to their home; quick, easy, and effortless.
Business owners, particularly retail companies, that have yet to incorporate mobile advertising into their marketing plans are desperately falling behind, and fast. More than $3.3 billion was spent on mobile advertising last year and the figure is expected to double again by the end of 2012.
Dr. Mark J. Perry, professor of economics and finance in the School of Management at the Flint campus of the University of Michigan, reports that newspaper ad revenues hit only about $20.7 billion in 2011. That’s down more than 50-percent from the record $49.4 billion achieved in 2005. While there is no exact data to support the theory, many experts seem to agree revenue lost in ad sales by newspaper publishers may have been gained by mobile advertising outlets.