Crafting a good mobile ad strategy using carrier network information means embracing SMS. But location can be problematic.
There are three main “branches” of mobile advertising: mobile banners on widgets and mobile Websites, which tend to not be targeted and aren’t very engaging due to their lack of graphics and small size. Mobile search is another avenue, leveraging the Google model of serving ads based on keywords used; however visually they have the same drawbacks as simple banner ads. A third is permission-based marketing via messaging, where advertising becomes almost a concierge service. That last approach makes the most of the personal aspects of mobility, leverages carrier data and offers a range of compelling response mechanisms for advertisers.
To wit, consumers opt into ways that they can be connected with their favorite brands through relevant and engaging information that’s tailored to their specific interests and lifestyles, and paired with loyalty offers like discounts on products and services. “We suggest as a format that you first qualify an interest with a question,” said Thomas Labarthe, vice president of mobile advertising at Alcatel-Lucent. “Then, you can build a very targeted campaign.”
“The most desirable inventory involves user permissions supplemented by explicit preferences and must offer broad scale to truly harness mobile as a marketing channel,” said Global Chief ROI and Direct Marketing Officer of the Mediacom advertising agency, David Kyffin.
Messaging-based advertising also addresses the widest form of formats, since SMS is not restricted to form factors and provides a very personal and a very responsive channel to the consumer. “That’s where the mass market is,” said Labarthe. “It has the potential to trigger all sorts of interesting models.”
Labarthe says SMS-based ads are less intrusive than banners. “They receive a message and decide whether or not to open it,” he explained. “There’s an initial opt-in process that gathers basic data on age and gender, and then campaign after campaign will collect the response of end users to various questions and build further consumer preferences.”
As for potential types of campaigns, there are several scenarios. But to be most effective, they need to make a value exchange. “Campaigns run by operators are more effective when there’s an incentive,” said Labarthe. “What that is varies based on plan and country. They need to be able to go to market and select the right group segments and sorts of channels to communicate new offers, be it new operator services or vouchers and coupons and information.”
Location is another oft-cited aspect that operators can bring to the table; Labarthe says traditional idea of LBS-based advertising isn’t necessarily the right approach. “You want to avoid the situation where you enter a shopping center and get 15 different texts. There’s a lot of hype about pushing coupons. But you have to relate that to how the end user wants to interact, and you need to keep the frequency of campaign engagement constant.”
He also notes that, depending on the country, the location accuracy of networks can vary. “The mobile cellular grid can actually make bad mistakes,” he said. “That’s bad from a business point of view and an end user point of view. Just because advertisers are willing to pay for location doesn’t necessarily make the business model fly.”
The next step is bringing together advertising and retail. Imagine being engaged in a campaign where you receive periodic vouchers from the brand, reach into an e-wallet application on the phone, and then redeem it by waving it across near-field communications (NFC) point of sale.
Consumers seem open to the idea of mobile transactions. According to the Mobile Marketing Association, there were over 850 million mobile payment transactions in 2009, and by 2020 there will be an estimated 10 billion mobile devices in use, more than one and a half times the population of the planet. As for SMS purchases, consider the success of mobile giving: Haitian donations have accumulated to 41 million dollars.
Please also see the companion to this article, The Moment: Mobile Advertising.
