MOBILE PHONE ADVERTISING





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INTRODUCTION

Advertising has found a new outlet through the technological innovations of Smart Phones and PDA’s. These handsets created the opportunity for an entirely new genre of advertising entitled “mobile advertising”. Both the superior capabilities and internet browser compatibility of these products present marketers with a variety of advertising vehicles.Primarily, mobile web advertising allows companies to purchase banner displays that are visible while browsing. This ultimately leads to capturing the consumer through post-click page views. The iPhone, specifically, utilizes these banners during its applications to a point of frequency where it is virtually impossible to avoid them. Additionally these devices are opportune for the strategic implementation of promotional text messages. Other mediums include the video-streaming capabilities of Smart Phones and PDA’s that are essential to the incorporation of commercial clips. These clips are now standard, (and again unavoidable) in popular applications such as YouTube and Pandora. Smart Phones and PDA’S are still an evolving media and their full impact on the advertising world (though inevitable) is still yet to be seen. Advertisers recognize that these devices are the avenue to staying ahead of the competition (Chang, 2009).



Reasons for Use:

Many of the product’s attributes make this mobile device an appealing vehicle for advertisements. Their personal nature conquers the ever-struggle to reach the consumer wherever they may be. Further, mobile phones have become a facility capable of housing highly targeted advertising (Mobile Advertisement). Smart Phones and PDA’s constitute a product that is deeply committed to satisfying the consumer. The endless features and applications of phones such as the iPhone allow practically any consumer to reach a new level of customization. Utilizing this, advertisers can associate with the appropriate applications to reach their specific target market at any time or place.
Advertisers anxious to create a more valuable experience for viewers can achieve this through Smart Phones. There is a much deeper engagement existent when a consumer is using their handset. Companies can incorporate more content and interaction and therefore these ads become a better use of their budget (Klaasen, 2008) Marketers also find these ads advantageous to gaining access to direct marketing and feedback. Equally beneficial to the consumer, this ease of access frees up disposable income and thus increases their purchases of goods and services (Villamor, 2008).




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Limitations:

As lucrative as this mode of advertising may seem to be it also bears limitations. Though specific segments can be sought out, mass reach is much more difficult to obtain. The industry’s variety of providers and device models are not universal to a single platform. In order to satisfy all an advertiser would need to build separate sites that would serve each type of smart phone. This is a luxury that many advertisers cannot afford (Chang, 2009). In order to overcome this companies are choosing to advertise on the universal sites that are viewable to the highest number of users. This too, however, limits the creativity of the ad. Further, researchers have found that the consumer is more driven to the site when it is optimized for their specific handset. This makes it difficult for mass consumer brands such as shampoo, etc, to achieve the scale and reach necessary for their advertisement to be effective (Chang, 2009). Globally the cost of these phones is out of reach.



Reach:

The reach of this product also suffers from its position in the product cycle. Only 3% of the population has a Smart Phone or PDA and advertisers recognize that the product has not yet reached its “tipping point” (critical point of evolvement). Ultimately it is recognized that the audience has not yet reached a critical mass (Villamor, 2008).


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COST:

The cost of mobile advertising via a Smart Phone or PDA has its pros and cons. The cost is expensive relative to other mediums however the recall has been found to be very high. CPM’s (cost per thousand) range from $20-30. The high level of engagement is believed to make these advertisements that valuable. While there are 3 billion phones owned throughout the nation there are only 1.5 billion televisions. This in consideration, these ad expenditures are attributed with a high degree of cost effectiveness. Suggested is that companies begin using the CPEU (cost per engaged user) route. This would be a less expensive alternative that would lead to an improved uptake of mobile advertising. By making the ads cheaper more companies would have access to purchasing them. Further CPEU’S give proof of the advertisement’s effectiveness (Chang, 2009) Advertising executives are reallocating some of their funds towards mobile advertising, however, they state that they will not commit more of their budget until the audience reaches a critical mass (Mobile Advertising).



SCHEDULING:

The nature of scheduling mobile advertising introduces new tactics. Most traffic occurs during applications, however while most of them are games, it becomes unlikely that a user will post-click (Chang, 2009). Instead, advertisements should be placed in non-game applications or during web browsing. Interestingly trends have been found that lead to a matter of seasonality. The summer and other seasons that lead to holiday travel increase mobile phone traffic, and need to be considered in the advertising schedule. There is also an opportunity for precision marketing. Promotional texts can be sent when the consumer is shopping based upon a signal that reveals their location. This allows the ad to be tailored to a specific consumer based on their profile, and serves as a product reminder (Reyck, 2003).


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Audience Characteristics:

The demographics and audience qualities are of important consideration in advertising, and mobile advertising is certainly no exception. As previously discussed it is nearly impossible for advertisers to cater to each individual platform of Smart Phone. The solution is to determine how much the particular model’s audience uses the device for purposes other than voice. Additionally, you can choose the optimal device through the demographics of their owner. Smart Phones such as the Blackberry are typically owned by a professional who uses it for work purposes and are high profile (Klaasen, 2008). Conversely, the iPhone is typically owned by a younger crowd who is using the device recreationally. These consumers are more likely to surf the web and are avid application downloaders (Mobile Advertising). It would be advantageous for the advertiser to consider this when describing the audience of their mobile ad.
The response rate of mobile advertising has been found to be higher than its counterparts. Its recall is surprisingly equivalent to that of a typical 30 second television spot (Mobile Advertising). Unfortunatley the high profile consumer that buys these devices is not likely to have the time to respond to ads as they are using the handset for work purposes. It has also been found that females are much less engaged in post click activity on iPhones versus other brands by 3-3.5 times. Overall, however, non- Smart Phone users are more likely to desert a website destination than the aggregate population of Smart Phone owners (Chang, 2009). Text promotions and web browsing banners reach a much greater level of responsiveness.





CONCLUSION

Considering both the limitations and opportunities Smart Phones and PDA’s present in the advertising world, it is obvious that there is much yet to be seen from this medium. Brand-in-Hand mobile marketing group has led Proctor & Gamble, General Mills and American Express to delve into this platform (Chang, 2009). Applications such as Facebook for the iPhone and Barnes and Noble’s ecommerce for blackberries have found much success. Competitors will find it essential to partake in mobile advertising in order to keep up with the times (Klaasen, 2008). Surely, however this products marketing potential will not be reached until its audience is of critical mass.






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REFERENCES


Chang, Rita (2009, October 14). Female iPhone Users More Likely to Tune Out Mobile Advertising. Advertising Age.

Klaasen, Abbey (2008, June 16). New iPhone Also Brings New Way of Mobile Marketing. Retrieved October 20, 2009, from Lexis Nexis Academic website: http://www.liu.edu/cwis/cwp/library/workshop/cita a.htm

Mobile Advertising Expected to Hit $5.7 Billion by 2014. (2009, June 3). Retrieved October 21, 2009, from Lexis Nexis Academic website: http://www.liu.edu/cwis/cwp/library/workshop/citapa.htm

Reyck, Bert De (July- August, 2003) Broadcast Scheduling for Mobile Advertising. In Operations Research (Vol. 51, No.4, pp. 509-517) Informs.

Villamor, Marites S (2008, September 12). Cell Phone Ads to Provide New Revenue Stream. Business World, pp. 11-12.