Road to mobile marketing under construction

NEW YORK-There was, of course, no shortage of hype at last week’s Mobile Marketing Forum in New York. But that enthusiasm was tempered by a surprising amount of restraint.
EJL Wireless Research predicts mobile advertising will generate $9.5 billion worldwide by 2011, with the U.S. market accounting for about one-fourth of overall revenues. Strategy Analytics Inc. is even more optimistic, forecasting a $14.4 billion market for worldwide mobile advertising by 2011.
For those sky-high projections to be anywhere near accurate, though, the wireless industry will have to work with ad agencies, brands and other outsiders to overcome some substantial hurdles. And they’ll need to grow the audience and increase traffic on the wireless Web, according to John Hadl, CEO of Brand in Hand.
“Gold is audience,” Gadl told attendees during a keynote speech. “Marketers don’t buy tools, they want gold. For many of you, the challenge is how do you convert tools into audience? That is how you’re going to get money out of marketers.”
Brand in Hand serves as a kind of liaison between major brand marketers and a handful of mobile companies. Hadl, who also acts as the strategic advisor to Procter & Gamble’s mobile marketing group, said companies in the wireless industry need to understand that mainstream advertisers aren’t necessarily interested in eye-popping applications. Instead, they want to reach as many consumers as possible-which means the mobile Internet is a lesser priority in advertising budgets.
Highway construction
Most market data indicate less than 20% of U.S. subscribers are surfing the wireless Web, and some studies suggest that even that seemingly modest figure may be inflated. Carriers and software developers might be able to boost those numbers by making it easier for users to get on the wireless information superhighway-and by delivering content more quickly.
“What the research shows is that delays of about a second (on the mobile Internet) result in users losing interest; delays of three or four seconds and they’re gone,” ZenZui co-founder Ben Bederson told show-goers. WAP “may work everywhere, but, I would argue, does not work anywhere very well.”
And the staggeringly fragmented market of devices and networks can prove all but insurmountable for an advertiser looking to place marketing messages on the mobile Internet. Even a well-thought-out campaign can produce ads that are compelling on some devices but illegible on others. So while the industry continues to strive to develop more standards for the mobile Internet, advertisers are taking the path of least resistance.
“The vast majority of mobile marketing today is happening with SMS,” Bederson continued. “Why? It’s the lowest common denominator.”
More advanced campaigns are sure to gain traction as advertisers learn how to better deliver compelling content across a wide swath of devices, and developers attempt to make it easier for consumers to navigate the Internet on handsets. But as traffic increases on the wireless Web, marketing companies will demand detailed feedback from their carrier partners. Advertisers will want not just demographic information, according to Eric Bader, senior vice president at MediaVest USA, the country’s fifth-largest media-buying agency. They’ll want to track campaigns, measuring the efficacy of specific ads, and use that information to tweak their efforts. “The data needs to be analyzed, it needs to be collected, and we need to be able to market back to consumers based on that intelligence,” Bader said.
Several players are already working to provide such data. In addition, the Mobile Marketing Association last week unveiled its effort to provide such information, announcing the formation of a Global Measurement Committee. The group looks to help create a framework for the measurement of advertising through a variety of mobile channels.
And while the MMA has made considerable progress in creating and enforcing mobile marketing guidelines, a handful of companies continue to create headaches for carriers, according to Chris Black, director of mobile marketing for AT&T Mobility. Network operators should take a larger role in dealing with third parties, he urged, helping to winnow the field by squeezing out the more troublesome vendors.
“There are certain things out there I believe we need to take control over, (like) affiliate marketing,” Black opined. “We need to thin the herd a bit, step backwards. It’s unfortunate, but I think we’ll be better for it in the long run.”
As the success of aggregators such as Jamster and Buongiorno has demonstrated, weeding out the more nefarious players on the field won’t be easy. And the industry will surely continue to struggle to find ways to make the wireless Web a less painful place to visit. But as the mobile Internet slowly expands beyond early adopters and into the mainstream, forecasts that today look outlandish may appear increasingly legitimate.
“If you can solve these issues,” Brand in Hand’s Hadl told wireless executives, “two things are going to happen: we’ll spend more, and you’re going to grow your business.”