@MWC: Brands, ad agencies suspicious of mobile marketing hype

BARCELONA — “No doubt about it, to some extent we’re selling change,” Tim Sefton, customer director of Telefonica O2 UK, said today on a mobile marketing and advertising panel.
That fact more than anything may be why for nearly the past decade, executive after executive has defined this and each subsequent year as the year of mobile marketing and advertising — and been so very wrong.
Personifying the problem the mobile industry has when it comes to convincing marketers, media buyers and ad agencies to direct more of their spend to mobile wasn’t hard to find in the audience. When asked how many in attendance were advertisers, only one or two raised their hands. Equally troublesome for mobile advertising as a whole, only two or three people raised their hands to identify themselves as someone representing a brand or ad agency.
It’s clear, even though the question is raised at every industry gathering that touches on mobile advertising, many are opting to step away from grand proclamations of the past and focusing on reality.
“I don’t know if anyone ever wondered what the year of television was or the year of radio,” said Edward Kershaw, VP of mobile at Nielsen. “Things can run on hype for quite a while,” he added. “But at some point the industry needs … to deliver us the media and combined tools that we all expect.”
Sefton concurred, adding that he now thinks it’s “dangerous for us to say things like this is the year of mobile.”
While it’s been true for some time, as Charles Johnson, GM of Microsoft Mobile Advertising, pointed out, “the ecosystem is rallying behind how to integrate mobile,” a significant number of roadblocks stand in the way.
The dilemma of mobile is that everyone on the media planning side wants to do something new, said Michael Bayle, VP of monetization and marketing at Amobee. To get any real return on their investment or worthwhile engagement though, scale is what matters most, he added.
Mobile assuredly has unsurpassed scale on the whole, but reaching across wide swaths of that user base similar to how print, TV, online and radio do is still almost impossible to imagine and for many worthwhile reasons like privacy, customer experience and others.
The traditional direct-marketing approach that the advertising and marketing worlds have built their empires upon does not apply to mobile, Kershaw said, and therein lies the problem. Mobile companies have to not only encourage a purchasing shift among digital marketers, but also a mindshift. Therefore it’s incumbent upon mobile companies to help redefine the rules of marketing under the mobile lens — an entirely different animal than even its digital brethren in online media.
“It’s just understanding where we compete and where we might collaborate,” Sefton said, adding that areas of collaboration should run along the lines of what the marketing industry needs to justify spend. |Those include reach, targeting, engagement, results and measurability, and loyalty.
These rifts explain why nearly 60% to 70% of all mobile marketing spend is via SMS. Sefton said SMS will definitely grow as the entire pie of mobile marketing grows, but the “amount of customers that are actually engaging in SMS advertising is quite small.” Indeed, richer formats are what will drive more engagement, he added.
Kershaw jumped in to add that SMS marketing is very sophisticated outside of the Western world, particularly because those markets are less careful about the type of engagement they want to have with their customers.
To wrap up, each panelist was asked to guess what ad type will comprise the largest share of mobile advertising in the years to come. As you can imagine, each executive’s response essentially fell in line with the interest their companies’ hold in the market. For Bayle, it would be display because the audio and visual cues that can be delivered via mobile are very effective. Johnson placed his bet on search. Kershaw — representing the only neutral party in this regard — went with SMS. And Sefton said his company is seeing the greatest customer engagement growth in applications and ads that are embedded within each of those.
Matt Kapko can be reached at matt@eyeonm.com.