SMS advertising

SMS (Short Message Service), otherwise known as text messaging, was one of the earliest forms of mobile advertising and is still used today. In fact, Greg Sterling recently posted an article on Local Mobile Search which highlights SMS campaign response rates as “often 2X to 10X higher than online advertising.” I would agree that the opportunity within SMS is huge. However, it’s important to note that it’s a valuable tool for existing customers but in our experience, may not be the best way to reach new customers. This is largely due to the confusions consumers may experience from having an SMS offer sent to them without having any context of the business or advertisement. If the consumer is not familiar with you, they may either respond thinking they will get something other than what you offer thus wasting both parties’ time, or else ignore your ad completely.

SMS Advertising is a valuable way for local businesses to connect with existing customers through loyalty programs. For example, the owner of a coffee shop could send a text message with a coupon code for 10 percent off the daily drink special to her list of customers who have opted-in to receive information on their phones. Similarly, the local book store owner could send a text message to his list of book club members to announce that the latest vampire romance novel is arriving next week with a free book bag offer for the first 25 readers that arrive that day.

Generally, this form of advertising is best used to encourage an in-store visit and not an actual purchase over the mobile device.

Mobile banner advertising

Mobile banner or display advertising is typically used by businesses that strive to establish a brand or identity as the way to create demand from customers. For example, a well-known brand such as Best Buy may place a banner ad on a mobile screen as a way of reminding consumers of its stores for future consideration for electronic purchases.

While display can be effectively used for online branding campaigns for national advertisers, typically, local advertisers tend to gravitate toward campaigns with faster sales conversions. Although display advertising can have a high-rate of click through, the conversion rates are often much lower than other forms of advertising due to lack of an opportunity for transactions.

We believe that local advertisers will have a higher likelihood for success using other mobile advertising methods, such as SMS or search advertising.

Mobile search advertising

Search advertising can be another effective way to reach consumers who intend to take action right now, such as making an appointment with a service provider over the phone or looking for directions to the business.

Typically, when consumers get to the point of searching for a specific key word or topic on a mobile device, they are beyond the research phase and are ready to engage with the advertiser. We’ve found that some of the best results occur when, after seeing the ad, the next step is a click to a landing page or mobile business profile page that enables a direct connection via a phone call to the business. Getting to the business phone number needs to be as simple as possible with the least amount of steps on the way, as the mobile user is often on the go and can’t afford to spend time clicking through multiple screens. Local advertisers that understand this need for simplicity have the greatest potential for effectively reaching new customers.

Again, to select the best type of advertising for your local business, it is most important to consider the action you want your advertisements to result in, who your customers are and which of these—SMS, display or search—will work best to reach them. If you are looking to strengthen existing relationships with your customers, implementing a loyalty program using SMS ads may be your best option. If you want to strengthen your brand among a certain audience, a display advertising campaign may actually work for your business. And finally, if you want to attract new customers that are ready to visit your store or make an appointment right now, a search advertising campaign can help you reach that audience.

While SMS, display and search are the three most basic types of mobile advertising, there are additional tools a local advertiser can consider, such as creating a mobile application for your business or managing your online business listings to ensure they are mobile optimized. However, for the sake of keeping it simple, I’ll ask that you stay tuned for future articles for an even deeper dive on mobile advertising.

A few months ago, I attended an industry conference and happened to strike up a conversation with the owner of a small travel agency. As I was expressing my enthusiasm over the advancements in search engine marketing, he smiled and said, “Yes, that’s all fine and good but Travis, I only have $300 per month for my search engine marketing budget. I get sales pitches from major search engines and online directories constantly and they all promise the same results. If you were in my position, where would you advise I spend my ad dollars to get the most impact for my money?”

It was a great question and frankly, it got me thinking. Given all of the options for local businesses to consider, and with so many distribution outlets to choose from, how would a local business owner know which option will provide the most qualified leads or potential customers?

Before making a decision about which distribution to use, he should think about what action he wants consumers to take in response to seeing his advertisement. Is he looking for a phone call to set up an appointment or a visit to his business’ Web site? Do his sales occur over the phone or through his e-commerce Web site?

When he replied that his business relies on phone calls and not on his Web site for sales, we moved to the next step – selecting the appropriate distribution vehicle. In order to effectively reach his target consumer, he needs to think like one. If you as a consumer were looking to contact a business directly over the phone, what Web site would you use to find a phone number? Or, what distribution outlet naturally lends itself to the action he’s seeking from a consumer – in this case, a call?

Anticipating the expectation

Consider this theory: When consumers visit a search engine or online directory, they are likely to have a pre-determined expectation for the type of action they will need to take. For example, if I was to visit Google, I would likely conduct a broader search for a business or service and click to the specific Web site to gather more information. If I was to visit an online directory, the action I would likely take would be to search for a phone number, resulting in a call.

Once you understand which consumer intent matches up with each distribution option, as well as determine that specific action your business seeks, it becomes clearer which option will best meet your business needs.

Following are additional examples of consumer intentions associated with the two options we discussed – search engines and online directories.

Search engines

When consumers use a search engine such as Google, Yahoo! or Bing, to fulfill a need, the intent is to receive additional information about a business delivered through a click or by being directed to a business’ Web site or landing page. Thus, the response an advertiser using this distribution choice will receive is a sales lead in the form of a click to their Web site or an online form completed by the prospective customer. Businesses that conduct sales through e-commerce will largely benefit from advertising on a search engine as clicks are the desired action to convert the sale.

Online directories

The pre-determined intent for consumers who visit an online directory, such as YellowPages.COM or Superpages.com is most likely to find a phone number. Typically, at this point, the consumer has made the decision to set-up an appointment and is now looking for either a specific provider within that category or is simply looking for the business phone number. Essentially, they’re ready to pull the trigger on the purchase. The business that would most benefit from advertising with an online directory primarily seeks customers through phone calls.

For the purpose of this specific business owner – a local travel agency that primarily conducts business over the phone – the most sought after consumer intent is a phone call. Given this preference, I advised him that an online directory will provide a higher likelihood of sales conversion than a more general search engine.

With search engine marketing evolving rapidly, local businesses have many great options from which to choose. It comes down to deciphering what action you want from the consumer and selecting the best vehicle to deliver those results. A campaign can be successful on even the most conservative of budgets but it must be well thought out with special focus and detail paid to ad copy and distribution source selection.