It’s not the Goliath of the digital age yet, but mobile is on the rise. Although 90% of UK marketers spend less than a fifth of their marketing budget on mobile marketing, against a backdrop of the rapid adoption of handsets equipped with new technology, an overwhelming 66% of respondents to Marketing Week’s latest Industry Attitudes Survey expect that proportion of their marketing budget to increase significantly.
Consumers are now using phones to download video clips, listen to music, network, play games and search the internet. However, while the majority of marketers believe mobile gives them the attractive opportunity for real-time, on-the-go engagement, the relevance of mobile marketing will depend on the product and services being offered and the target audience. A significant 25% of respondents don’t consider mobile marketing spend to be as important as other channels and say they do not use any forms of mobile marketing.
Phones are increasingly the gateway to the online world, so there are likely to be shifts in the type of mobile marketing practiced in the future. Meanwhile, SMS continues to be the most widely used aspect of mobile marketing and is employed by 41% of survey respondents.
However, with sensitivity to the intrusive nature of SMS marketing growing, some marketers are changing the way they use the mechanism. “We are considering making the transition from using SMS for marketing messages to only using it for customer service or delivery information,” says one retail marketer.
The existing popularity of the channel is augmented by further uptake over the past 12 months with a further quarter of respondents saying they have started to use SMS. “It’s simple. Everyone, no matter who you are or what you do, will always instantly view an SMS message once received,” says one respondent. “This means that you are able to target an audience and can almost guarantee they will view the content.”
Time spent on mobile devices is increasing, so the need to invest in on-the-go applications is seen as critical, with a striking 38% of UK marketers using mobile apps as part of their marketing strategy. The proliferation of smart phones accounts for the growing importance of a mobile apps strategy and more than a quarter of marketers have started using mobile apps in the past year. Over the next year this will steadily increase as shown by the 63% of marketers predicting a rise in the amount they spend on the channel.
However, key challenges with the use of apps remain, not least creating ones that people both want and find engaging. As one marketer notes: “Millions of apps already exist that are downloaded once and never used.”
The arguments continue to rage between those who see apps as the future and those who believe mobile sites will take precedence. Mobile sites are part of the marketing strategy of 30% of survey respondents and they look set to become more important with over half of respondents saying they intend to spend more on the mechanism next year.
“We have seen traffic figures to the site rise dramatically from mobile devices in the past 12 months,” says a marketer for a department store. “The customer we can target through mobile is the cash-rich/time-poor executive who spends time in airport lounges and on trains browsing the web on their iPad, tablet or iPhone and it will be a great opportunity to tap in to the purchase path of this customer going forward.”
The future opportunities should be in mobile sites that fully enable the customer’s experience on a smart phone, argues another marketer. The importance of usability is underlined by a further respondent who says, “The main challenge facing marketers over the next 12 months is to ensure your website can be clearly seen on a mobile device.”
Mobile advertising is also expected to grow in the coming year as the required infrastructure is built out. Currently, 12% of respondents advertise on mobile sites other than their own. One marketer comments on the challenge of this area: “People don’t visit ads when they’re using mobile web, so the main challenge will be to do a very good marketing campaign to its mobile services.”
The key difficulty is to advertise in a relevant way. “It is crucial to avoid the temptation to just put content from other media channels on mobile,” comments one marketer. “It needs to be a media-specific execution.”
Location-based services, however, although the subject of massive hype, seem not to have reached the mass of marketers’ agendas. The survey reveals that only 12% of marketers are investing in location-based services this year. “The immediacy of the communication provides a great opportunity to engage with customers anywhere,” enthuses one. “Location-based services are key and I believe this, combined with mobile apps, will become much more prevalent in the marketing mix.”
Relevance and increasing connection with the consumer at the moment of purchase are tactics on the rise for savvy marketers. “Location-based marketing via GPS is an interesting example of how marketers are almost reverting back to the traditional local market rather than global sales,” says another respondent.
Another aspect of mobile marketing linked to the adoption of smartphones is the QR code. These are rising up the agenda, with 18% of UK marketers integrating them into their mobile strategy. Many respondents cite them as the main opportunity presented by mobile marketing over the next 12 months.
“Most [smartphone] users like to engage with various media forms like QR codes and location-based maps,” comments one marketer. “I can see there being a strong link to applications in future, for example brands using QR codes taking you to the app store to download their app where you’ll then receive a coupon.”
Indeed, mobile coupons are a small yet significant aspect of mobile marketing, with 10% of respondents incorporating them into plans.
Another increasingly significant aspect of this mechanic is Near Field Communications (NFC), the technology behind contactless payment.
“Having a wallet in your mobile is going to revolutionise the way we use devices and will challenge cards for usage,” says a UK marketer. “Being able to use NFC to offer mobile users in-store vouchers, coupons or video is going to make ’hyper-local’ marketing a big thing.”
Managing messages over various different platforms and maintaining consistency will remain important in the integration of mobile and other marketing channels in future. More than a third (35%) of marketers share data from mobile campaigns with colleagues responsible for other marketing channels. However, a fifth (20%) are not sharing this data with other marketing departments.
Actually proving whether the interrelated aspects of mobile marketing work and demonstrating a return on investment are still issues for many marketers. The question of whether the data measurement available within mobile marketing is up to scratch is still a moot point for many – with only 38% of respondents happy with the level of measurement available.
“Understanding what the data means, so they can learn from their activities and maximize their expenditure in the shortest possible timescale,” will be the key challenge for mobile marketers argues one marketer.
Many respondents are unsure of what additional mobile metrics they would like to have available to them but those with demands for the future found them ranging from “all the key metrics we see for websites” to “stats as deep as Google Analytics” and “viewing time”.
Mobiles offer marketers the chance to engage at a deep level with their customers but they must do it in a relevant and tailored way.
Another significant challenge to making this type of marketing effective is galvanising mobile expertise. “Challenges depend on the size and speed of the organisation to adapt to technological changes,” argues one respondent. “For large companies, the main challenges may be to co-ordinate efforts between business units and offer a unified user experience across platforms, while for small companies it may be about having the right human and financial resources to engage in mobile marketing with a well thought-out programme.
As it stands, almost one-third, 27%, of marketers are doing mobile marketing in-house. Meanwhile, 24% are using specialist agencies and 18% are using integrated agencies for their mobile marketing needs.
As one respondent underlines: “More and more people are now moving to mobile and marketers have to understand this environment or face losing the race.”
About this survey
- The research was conducted in April 2011 among readers of Marketing Week magazine and MarketingWeek.co.uk subscribers.
- The biggest percentage of respondents (24%) work for organisations employing between 101 and 500 people. The next biggest group (23%) work for companies employing under 50.
- Client-side respondents came from a variety of industry sectors. The largest percentage (16%) came from the financial sector, 10% from technology, 9% from not-for-profits, 8% from media and 7% from travel & leisure.
- 47% of client respondents with responsibility for digital marketing were marketing managers, 13% were marketing directors, 4% managing directors and 3% brand managers.
- Results have been rounded up or down to the nearest full percentage point. Not all tables add up to 100 as there may be more than one answer given where indicated.
- 66% of those surveyed expect the proportion of their marketing budget spent on mobile to increase.
- 25%don’t use any form of mobile marketing.
- 63% expect to increase spending on mobile apps, compared to 52% who expect to increase spending on mobile sites.
- 27% say they do all their mobile marketing in-house, rather than using either a specialist mobile agency or an integrated agency.
- 37% don’t measure the effect of their mobile marketing on other marketing channels.
1 In the next 12 months, do you expect the amount you spend on mobile marketing to:
2 Which, if any, of the following forms of mobile marketing do you use?
3 In the next 12 months, how do you expect your spending on the following types of mobile marketing to increase?
4 Do you share data from your mobile campaigns with people in your marketing department or your agencies who are in charge of other channels?
5 Are you satisfied with the level of measurement available for your mobile marketing campaigns?
6 Do you work with specialist or integrated agencies to create your mobile marketing campaigns?
David Barker, director of advertising sales, Europe & Africa, Navteq
The one thing that has been missing in mobile up until today is tying in consumer location with marketing mechanics such as advertising messages, QR codes or coupons. What is clear is that mobile is coming of age. A key factor that people are picking up on is mobile’s ability to close crucial marketing message loops with mechanics like QR codes. There is greater emphasis on the potential of mobile as a CRM channel.
The Marketing Week Mobile Marketing Attitudes Research Survey highlights location as the emerging driver for the coming year and, more importantly, the fact that UK marketing managers are attuned to the growth of location-based services. This includes coupon offerings on mobile phones that are increasingly geo-specific.
Smartphones are a driving force because once people have a high-end phone, it is easier for the industry to serve them with contextualised location-based messages. Also more and more brands have mobile sites that allow location to come into play.
The survey shows a high percentage of brands implementing their mobile strategy in-house. However, given the rapid changes in location-based technologies, this will become increasingly challenging. Brands should tap into the knowledge of expert mobile specialist agencies who are well-equipped to put together a robust strategy in this brave new world.
So what of the future? From the survey’s future-gazing, it seems that a lot of marketers are saying they are focused on building an app or a mobile website, but not so many of them are saying they are focused on mobile advertising. That’s quite interesting because I predict that next year, once more and more brands have built mobile sites, there will be a strong need for mobile advertising to drive traffic to them.
There is an interesting parallel here to the early days of the internet when, once websites appeared, advertising swiftly followed as a monetiser. In fact, survey respondents are intimating that when mobile advertising becomes even more accountable, that is when it becomes more interesting for them. People are saying they want more data analysis, more reporting tools and more clarity on their ROI for mobile. Otherwise put, mobile advertising is an attractive proposition, but because it is still relatively new for most marketing directors, they want to see a clearer picture on what they are getting. So as the industry continues to fine-tune mobile marketing, the potential of the medium becomes enormous.