Are you ready for the mobile advertising revolution?

The mobile advertising market is set for explosive growth, ushering a new era of personalisation and engagement, says James Hilton.

Like it or loath it, advertising plays an important role in our social fabric. It helps to start trends, propel cultural identities and keep us informed about the latest products and services. Advertising has, however, always suffered accusations of manipulation, exploitation and misleading audiences. Marketing will always have its strengths and its weaknesses, these will largely amount to the way in which brands either exploit potential consumers or use advertising as a long term brand positioning tool, creating demand and loyalty.With consumers being perpetually bombarded by messages, many have perfected the ability to ‘tune-out’. Over the past few years the channels available to advertisers and promoters have expanded dramatically – we now have seven mass channels: outdoor, print, radio, cinema, TV, online and mobile. Each has its place in the marketing mix, but mobile has the ability to act as a glue that binds the others.

When used with other types of advertising, mobile is an incredibly powerful platform that has the ability to deliver measurable results about engagement and make the advert contextually relevant. For example, the campaigns from Blippar, the augmented reality company, makes advertising and products come alive to let users know about local offers, changes to prices or shop locations. And one of Tesco’s recent campaigns allows consumers to use an advertising board at Gatwick to purchase groceries using their phones. This mix of outdoor and mobile ads help consumers feel engaged with the brand and shows how public acceptance of using mobile to interact with other forms of advertising has increased.

A TIME magazine study found 68% of people sleep with their phone next to their bed. It’s also the first thing most of us look at before going to bed, and the first thing we wake up to. Nokia once stated that on average someone looks at their phone 150 times per day! While we may upgrade to a newer model every few years, we are well and truly attached to our mobiles. For the marketing community, this is profound. Recent studies have shown that when it comes to effectiveness, mobile marketing campaigns perform better than traditional channels in terms of awareness, recall, action and decision-making.

Research recently released by the Internet Advertising Bureau shows that only 40% of the top 100 brands have mobile-optimised websites. Such websites get more consumer attention with an average time of 5 minutes – 2 minutes longer than for advertisers without a mobile web presence. If people can’t easily find company information relevant to their needs, it is the company that loses out.

Further research, this time from the Online Publishers Association shows that 39% of consumers using a smartphone were driven to take action after seeing an ad. Also, 15% of all smartphone content consumers have clicked on an ad compared to the 0.2% online click rate.

Because of the intimacy, targeted nature and increasing functionality of mobile devices (for example mobile payments), we are reaching the point where contextual relevance advertising can really kick off. This would mean that ads can be targeted to us based on who we are, where we are and what we may want. While this may sound like a privacy and personal information barrage, technology now exists to allow users to control exactly what information they give away, and the type of advertising they are happy to receive directly from their phones. This allows mobile advertising to deliver information relevant to an individual, adapting its message to the time, weather and location to have the best impact.

Mobile advertising accounted for 1.06% of the total spend on advertising last year ($5.3bn out of $498bn). But companies are now rapidly increasing their mobile ad budgets.
A lot is at stake. Facebook is implementing a mobile ad strategy. It currently has 550 million monthly mobile users who aren’t seeing the adverts they would otherwise see from a computer. In 2011, Google’s gross revenue from mobile ads brought $2.5bn for the company.

But there are still hurdles to cross when it comes to dealing with privacy and data protection, there is no denying the power and targeted reach of mobile. Its relevance will only grow. The digital generation who live through their phones or have a mobile device in their hands when they are consuming other media, which is now being called ‘double screening’, have embraced it.

Delivering advertising that is relevant to an individual’s interests, preferences, wants and needs means that the validity, importance and value of mobile advertising will increase with time. It will not be long until services like Apple’s Siri are developed to act as true personal recommendation engines.

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