The Pros And Cons Of Mobile Marketing

Managing a mobile marketing campaign can be a challenge because there are many different entities contributing to a successful campaign. At minimum, we have the carriers, advertisers, and consumers. But in the background, we have third-party technology companies like Enpocket, ThirdScreen and Quattro; not to mention industry organizations like The Mobile Marketing Association, the CTIA Wireless Association, and the Interactive Advertising Bureau, which provide resources and guidelines for setting the standards to help move the industry forward.

This article is part of Local Search Week here at Search Engine Land, a special look at local search marketing issues in the run-up to our SMX Local & Mobile conference next month.

While local search marketing is well established, local-mobile search marketing is barely getting started. Marketers will spend $3 billion worldwide on mobile ads this year (ABI Research, April 2007), with spending expected to reach $11.35 billion by 2011 (Informa Telecoms & Media) as more users start surfing the web on mobile phones.

The number of worldwide mobile phone users is expected to grow from 2 billion in 2005 to approximately 3.3 billion in 2010. Currently, there are over 2.8 billion mobile phone subscribers. In the U.S. alone, we had 233 million subscribers at year-end 2006, which is over 76 percent of the population.

Mobile marketing has the potential be the next big thing in interactive marketing. As Greg Sterling stated earlier on SEL, “We are on the cusp of a new mobile era.” However, there are many obstacles to overcome. Below are some issues for consideration when planning a campaign.

Pros and cons of mobile marketing

Pros:

• High penetration of devices with twice as many cell phones as PCs.
• Web searches on mobile devices will eventually exceed searches on PCs.
• Access to many international consumers who can’t afford PCs
• Mobile phones can receive input anywhere-anytime, enabling location-specific and behavioral targeting for local businesses.
• A cell phone is a very personal device that people take with them wherever they go, making it easy for marketers to develop a relationship with customers through this medium.
• Carriers have customer data and location information potentially available for targeting.
• Personalization, immediacy, and interactivity of mobile ads encourage response by consumers on the go.
• Preliminary data show good response rates for mobile campaigns (5% click rates vs. 1% for conventional web ads).
• New tool for brands and advertisers to reach new customers and target specific audiences.
• Smartphones and iPhone to enhance mobile surfing, promoting mobile marketing success.
• Messages sent to a mobile phone are more likely to be read than email sent to a PC, which can get caught in the spam filter.
• Mobile marketing campaigns are highly targeted and are opt-in, making them more effective than other forms of advertising.
• Mobile marketing can help build a customer database. Once customers opt in to receive an ad, you can use the information for loyalty marketing and customer retention.
• Mobile marketing can help generate buzz about your products/services because your offers will reach consumers while they are actively shopping, socializing, and making buying decisions.

Cons:

• Current WAP technology inadequate, discouraging web searching and surfing.
• General intolerance of advertising messages on a personal device.
• Current carrier-imposed “walled garden” approach prevents unfettered mobile web access.
• Adaptation of content and messages to the mobile web results in poor user experience.
• Scarcity of mobile web sites (only 8% of 1,000 top U.S. brands offer a mobile site).
• Current low usage of WAP-based mobile search doesn’t support investment in creating mobile sites because traffic volumes are low except on search portals and other high-volume sites.
• Trial and error period required for mobile marketers to learn how to succeed in mobile marketing, which differs from the traditional web marketing.
• Advertisers are wary of consumer privacy issues.
• FCC yet to rule on limiting use and release of customer data, including location information.
• In April, FCC released order requiring mobile marketers to obtain express consent from customers before carriers can release data and to make it easy for customers to opt out.
• Mobile marketing is fragmented and complex because of many different handsets and carriers, different types of functionality, and different preloaded apps (i.e. Google Maps on iPhone).
• Currently, reach is low because consumption of mobile content is small (10% of subscribers), and penetration of 3G devices is still low in most countries.
• Establishment of reliable measurement and metrics for advertisers to measure mobile ad effectiveness is needed.

There is much more to know about managing mobile marketing campaigns besides the pros and cons. You’ll want to know what types of campaigns work best, how to target your audience, and the most important factors leading to campaign success. To learn more, consider attending SMX Local & Mobile 2007. I’ll be speaking and will elaborate on these topics. Hope to see you there.

Paul J. Bruemmer has provided search engine marketing expertise and in-house consulting services to prominent American businesses since 1995. As Director of Search Marketing at Red Door Interactive, he is responsible for the strategic implementation of search engine marketing activities within Red Door’s Internet Presence Management (IPM) services.