This is the year to take mobile more seriously

nutley

Mobile marketing has come of age thanks to social search, targeting and the ever-growing popularity of smartphones.

A new advertising medium only comes of age when it discovers the thing it can do that no other medium in the market can.

Before that point, it’s just a case of importing other advertising models. Take online. The early banners looked like press ads and there was considerable excitement when bandwidth became sufficient to show video ads. But the real turning point in online advertising came with the development of search and paid search in particular. Here was something that gave advertisers an unprecedented glimpse of consumers’ intent and could only be done online, so it’s no surprise that search continues to take the majority of online advertising spend.

So what about mobile? Despite all the successful campaigns run with SMS and the efforts made to establish mobile advertising, location has always looked like being the thing that mobile could offer that no other medium could. In the early days of the mobile internet, industry experts genuinely believed that marketing messages offering deals from every shop you passed delivered to your handset would be the way of the future, although a few dissenting voices suggested that it would still be cheaper and easier to have someone standing outside handing out flyers.

And anyone seeing the proliferation of ‘golf sale’ sandwich-board men in central London in the early part of the last decade would have been forced to admit the dissenters were probably right. In fact, although everyone suspected location information would play some vital part in the future of the mobile industry, nobody could quite figure out what it was.

Until now. The rise of deal-based services has brought location right back to the forefront of thinking about mobile marketing. In fact, at the Local Social Summit last November, industry analyst Greg Stirling talked about data showing that deals and offers were consumers’ preferred form of mobile ads. They weren’t interested in other forms of mobile advertising, he claimed.

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Dissenting voices suggested that it would still be cheaper and easier to have someone standing outside handing out flyers. And anyone seeing the proliferation of ‘golf sale’ sandwich-board men in central London in the early part of the last decade would have been forced to admit the dissenters were probably right.

Sure everyone loves a deal – it’s the basis of Groupon’s extraordinary growth. But what makes this especially interesting for mobile is the proliferation of smartphones, improvements in targeting and the rise of social search. Suddenly what’s possible on mobile goes far beyond what a bloke with a handful of leaflets can achieve. The technology allows companies to target you with offers based on both your previous behaviour and your location, and will only become more accurate and useful as transactional information is integrated as well.

And the benefit for businesses is that Groupon-style offers stop pulling in people who just want a discount and can instead be used to move towards yield management. If you know who your Tuesday night regulars are, maybe you can give them an incentive to visit more often, for example. Or maybe a discount can persuade some of your Thursday crowd to come in earlier in the week. This is backed up by Google’s findings that, while PC-based searches result in an action within weeks or months, mobile searches are acted on within hours.

However, the language that location evangelists use to describe what’s possible also highlights the limitations. It feels at the moment very much like the opportunities are only really applicable to hospitality businesses and, to a lesser extent, local retailers. But as another Local Social speaker pointed out, one-third of industries are emergency need-driven. There’s not much advantage to a plumber or locksmith in being able to offer daily deals.

This shouldn’t be too much of a barrier to adoption because although search seems ubiquitous, there are still companies, particularly FMCG brands that sell through retailers, that have yet to find a way to really take advantage of search.

The other interesting aspect of the social-local-mobile discussion at the moment is how much it focuses on small and medium-sized businesses, again a return to the early dotcom days when the commercial internet was seen as a way of expanding the market for local firms. But in fact the big brands are already active in the space.

The Grand Prix at this year’s New Media Age Effectiveness Awards was won by Manning Gottlieb OMD’s Starbucks Rewards campaign, which included sending vouchers to mobile phones within a defined radius of Starbucks’ outlets. The key insight came from a Lightspeed Research study done in October 2010 that showed 28% of people were happy to receive vouchers via their phones, while a further 48% were happy to receive them if they’d previously registered with the brand in some way.

Just as search isn’t the only form of online advertising, location-based mobile deals and coupons won’t be the only form of mobile advertising. But the combination of social search, targeting and the ever-growing popularity of smartphones means mobile might have just had its pay-per-click moment.

Michael Nutley is a writer and consultant specialising in interactive media michael.nutley@blueyonder.co.uk

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