From simple text messaging to sophisticated location-based advertising, the mobile has real potential for innovation. We talk to industry expert Julie Ask of Jupiter Research about the market’s outlook.
Advertising on mobiles must currently be one of the fastest growing business activities in the communications world.
“People have very high expectations,” says Julie Ask, Vice President & Research Director at Jupiter Research. “The market is growing at up to 300% per year. A couple of years ago companies were experimenting with spends of USD 10,000, now we’re seeing six-figure campaigns.”
According to Ask, lots of new ideas are being trialled. Some will fail, some will succeed. But what is certain is that more and more companies are looking at the potential of mobile advertising to get their messages out to consumers.
A May 2007 survey in the USA by Jupiter Research, found that 18% of advertisers have used some form of mobile marketing in the past 12 months, with 34% of advertisers planning to use at least one mobile marketing tactic in the next 12 months.
Formats are getting more advanced
Early forms of mobile advertising were largely messaging based, while more recently, display type adverts aimed at higher end smartphones have appeared.
“In the future I expect to see more video display adverts,” says Ask. “We’ll also see completely new forms of mobile adverts. Adverts that appear when the phone is switched on, or when switching between applications, even between rounds of a game. These types of in-application advertising can be a great way to help product placement.
Subscribers remain to be convinced
There are lots of opportunities, but also many hurdles. Mobile advertising calls for new thinking. The level of creativity must be excellent with visuals that work well on a small screen and don’t take too long to load over slower network technology. Mobile adverts must be less intrusive, more relevant to the recipient and less frequent.
The mobile is a very personal device with users wanting more control over who accesses them than on the PC. This is generating resistance. Jupiter Research’s own findings show that 70% of US mobile phone owners do not want to receive promotional offers via text message under any circumstances. 18% want assurances that any offers will be relevant to them. 85% of owners are afraid of spam.
Opportunities for operators
Yet the outlook is not as pessimistic as these figures suggest. “It is unrealistic to expect users to pay for all content,” believes Ask. “For greater adoption of services, we have to have advertising. Experience shows that when surveyed, people are always quite negative about advertising, but when they experience it, they generally accept it.”
For operators, mobile advertising presents clear opportunities. Ask comments: “They need to put the infrastructure in place and must protect the privacy of subscribers. If they can attract traffic and get eyeballs, then they’ll do well out of advertisers.”
“We are still in the early stages of mobile advertising,” comments Ask. “Some companies are getting traction and we are beginning to see traditional advertising groups buying up mobile advertising agencies. The genre is clearly moving into the mainstream.”
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