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Notes from Mobile Advertising – USA conference

jim_cookJim Cook, editor of MobiadNews, spent a week in New York at the Mobile Advertising & Marketing-USA conference put on by Informa. The weather dropped from a pleasant 50º F on Monday down to a wind chill of minus 25ºF on Tuesday, (yes, that’s minus 30ºC!) and a bit of snow threatened to disrupt the airport again, but aside from the uncertainties of New England weather in March, the conference was well worth the trip.

A key feature of the conference was the participation of people from all parts of the value chain: advertisers (Coca Cola), ad agencies (Oglivy, Denuo/Publicis), technology enablers (Hyperfactory, sixteen30), platform providers (Enpocket, Third Screen Media, MobiTV, AdMob), operators (Sprint, Cingular), MVNO’s (Boost, Ampd), handset software (QualComm, PacketVideo). And the format of the conference was such that there was lots of opportunity to network and talk outside of the conference sessions.

mobile_ad_confAfter listening to 20+ speakers over 2 days, several broad themes emerged. On some there was general agreement, on many there was spirited debate. In the coming weeks we will discuss many of these key industry issues in more detail, but here is an overall snap shot.

Mobile is a unique advertising medium with unique attributes. Though not ideal for all situations, mobile is superb for “engaging the consumer”. Other media may often be preferable for branding and awareness, but for engaging the customer and for the interactions that build a lasting relation, mobile is great.

Big brands are interested, but it will be some time before they invest major money in the mobile part of their campaigns. Tom Daly from Coca Cola showed very interesting examples of mobile advertising that Coke has run in France, Mexico, UK, and Germany, but even then most of the activity is relatively small, and one of the primary objectives is trial/test/learn.
There seem to be at least 3 issues that need to be solved:
• fragmentation – its very difficult for a brand to get the reach they want – there is fragmentation across operators, fragmentation across handsets, different ad serving platforms, no standards.
• media buying for mobile is separate from other media buys. One attendee was heard to say “if I buy $50million a year television time from someone, why would I buy mobile ad inventory from the same company through an operator or other third party?”
• there is still some inertia/suspicion/lack of understanding at the top levels of major brands and agencies.

Education of subscribers is important. The mobile phone can do many things, but – depending on the country – most subscribers still only know how to talk. Developing certain consumer skills will make mobile advertising even more effective. These consumer skills would include being able to send/receive sms or mms, to download and run applications or games, to take a picture and upload, to navigate WAP sites. Consumer education was cited as a major objective by Chris Black of Cingular.

Its too hard at the moment – there are too many “moving parts” that have to be coordinated – messaging platforms, video platforms, operator connectivity, handset testing, WAP development, etc. This has proven to be a good business opportunity for several companies, such as Hyperfactory and Sixteen30 who have developed the expertise of managing all these moving parts. But still it slows down overall uptake.

Role of mobile operators is not yet clear. They own the delivery pipes, and they have a tremendous amount of customer data that can greatly increase the value of the ads. And they desperately want to remain part of the value chain so they can collect part of the revenue. As we see them develop, the individual operator strategies appear widely divergent. In the past, the instinct of many operators when entering new markets has been to impose a high level of control and try to do everything themselves, and this maybe happening again with mobile advertising. How this impacts the growth of mobile advertising will be something to watch carefully.

12.03.2007    Tags: ,
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