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Operator Profile: Vodafone (part 2)

Interview with Richard Saggers
Head of Mobile Advertising

saggersv5.gif In the previous MobiAD News newsletter, we ran Part One of our interview with Richard Saggers, where he discussed Vodafone’s view of the mobile advertising opportunity, their overall strategy, plus details of key partnerships with Yahoo! and Google (if you missed Part One, you can see it HERE). This is Part Two of the interview.

You said earlier that Vodafone has lots of subscriber information that can be used to effectively target ads. Clearly this could be a big benefit for the operators, the advertisers, and frankly even for the subscribers. Could you tell us how Vodafone is approaching this?
In our view, there are fundamentally 3 levels of targeting we need to work with.

The first is Contextual targeting. This would be things such as what time of day is it, where are you on a page, which day is it, etc. which can allow for a certain degree of relevancy.

The second is Demographic data, for example age, gender, home location.

Finally, there is Propensity modeling, which looks at a subscriber profile and how they consume mobile services, tries to understand what this says about behavior, and you use research to validate profiles and buying patterns.

Another feature that is often linked to this is frequency capping. Are you investigating this as well?

Definitely – this is a big plus for the mobile channel. Since we know which ads are being served to a person, we can insure that a particular ad is not shown to a subscriber too frequently. This is not something you can do with other media like TV or online.

Perhaps even more interesting is the capability for “storyboarding”. Here’s an example. Suppose we know that a subscriber saw a branding message from a company on Monday. On Wednesday we have the option to send that person another ad, so this time we send a product-focused message. And on Friday we show a “click through to coupon” ad, which leads them to a redemption path. We can track this and manage it all the way through. This is something that is only available with the mobile channel.

Let’s talk about timelines, are all of these capabilities going to be available soon?
saggers_text3.gifAs with most technologies, they will phase in over time. For example in the UK, basic contextual targeting will be available with Yahoo immediately this summer. Frequency capping and storyboarding are part of the roll out that will happen over the course of the year, along with targeting based on demographic data.

Propensity profiling will take a bit longer. Actually, most operators have been doing propensity profiling for years for CRM purposes. What is going to take some time is to be able to apply it to advertising.

One more thing I would like to add on the subject of time lines. It isn’t only technical capabilities that are important, but also the creative side. We really need agencies to understand these capabilities and know how best to use them. A lot of education needs to happen, which is why we are so active with the MMA and other similar bodies.

One concern that is often discussed is confidentiality of data. How is Vodafone addressing this within the context of what you’ve described?
Actually all the customer information will stay within Vodafone. We will control it so there is no question of any confidentiality problems.

Essentially what we will do is to pass a code to the Yahoo! ad serving system that says what type of ad to serve. This way they never see the actual customer information that needs to be kept private.

And will you make this targeting information available to everyone who wants to serve ads to a Vodafone subscriber?
saggers-image4.gifIn the near term we will be concentrating on our own inventory, which is the Vodafone Live! inventory. We want to build up the system to understand where the value is in terms of targeting, and understand the technical requirements. We need to get it sorted out for our own inventory before extending it beyond.

I’m sure that Vodafone has been in touch with a lot of major brands about mobile advertising. What has their response been?

They have told us that there are two things that differentiate Vodafone in this area.

The first is simply the strong brand presence of Vodafone. We have a strong brand that many advertisers would like to be associated with.

The second is our global footprint, and therefore the capability to do cross border campaigns. You wouldn’t necessarily send the exact same message in each market, but you can go to just one provider.

We are having detailed discussions with major brands now on how and when this will happen.

Recently Vodafone has announced they will be moving to a flat rate data pricing scheme, and they will start supporting a much more “open” view of mobile internet, rather then just focusing on Vodafone Live!. What is behind these moves?
Our main intent is to unlock that opportunity so that people come to see mobile as an interface into the internet world, and start to use it more. One big issue has always been the transparency of pricing, we want to remove that concern. We want people to get used to accessing the internet through their mobile device.

My last question to you would be what in your personal opinion are the one or two key things that need to happen in order for mobile advertising to grow and fulfill the promise we all believe it has?
saggers_text2.gifThe biggest thing in the short term is that we all need to understand that this is an industry play, not an individual operator play. We need operators to work together to develop ad standards and common reporting metrics. Mobile media needs to be easy to buy, and it needs to be easy to understand what you bought and easy to understand the results you get. If we can unlock this, than we can accelerate growth. This is why we are very active in the GSMA and the MMA, to get this dialogue going and get that kind of engagement happening.

The second thing is there is a big need to educate and evangelize over the next 12 to 24 months. We need to help people understand why they should advertise on mobile, how does it fit into wider campaigns, what are the unique elements, and where does the value sit. Once people understand that, we will see the industry grow as a whole.

Thank you very much Richard, and best of luck with all your plans.

28.05.2007    Tags: , ,
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