The last days have been sharply focused on mobile advertising, beginning with the Mobile Marketing Forum in Berlin (an extremely worthwhile event that highlighted how brands such as Nike, Coke and P&G are benefiting from pragmatic approaches to mobile advertising) and continuing today and tomorrow with Comverse HUB Value Added Services Seminar in Budapest. (By way of background, Comverse HUB is a synergistic framework of Value Added Services, comprised of four product families – Voice, Messaging, Mobile Internet and Mobile Advertising.)

I am honored that Comverse has asked me to speak on the key findings of Mobile Advertising Research UK, a research project research endorsed by the Interactive Advertising Bureau (IAB) and the Mobile Marketing Association (MMA), to expertly document the state of the mobile advertising industry in the U.K. and identify growth opportunities in the emerging mobile advertising marketplace.

I’ll be back later this week with a summary of the key takeaways from the Mobile Marketing Forum (including some eye-opening brand case studies and results that set the bar – literally). I’ll also have some highlights from the Comverse event (where I join speakers from companies including Orange-FT Group, Kyivstar Ukraine, Vodafone Italy, and MegaFon Russia, as well as Jonathan MacDonald, a mobile advertising authority/consultant and Managing Director of Jonathan MacDonald Associates).

For readers who may not be familiar with the Mobile Advertising Research U.K. project allow me to outline the top level findings I will also share with delegates at today’s event.

The report – which combines valuable consumer insights gathered by ÆNEAS Strategy Consulting and Management and qualitative research based on 20+ interviews with operators, enablers, agencies, and brands contributed by MSearchGroove – found that people are happy to mobile advertising if it is delivered on their terms.

Only 32 percent of the 1,000+ consumers surveyed had a positive attitude toward receiving advertising messages on their mobile phone. However, that number rose to 64 percent, under the condition that were properly “incentivized,” and 70 percent if they were incentivized and “in control” of their mobile advertising experience via mechanisms such as opt-in.

A whopping 70 percent of those surveyed said they would grant permission to receive advertising on their mobile phones if they were “incentivized” and “in control” of the advertising experience. The number one incentive for consumers is a one off cash amount (36%), followed by a monthly discount on the phone bill (26%) and a monthly amount free to spend (13%). The majority of those surveyed felt five advertising messages per day was the limit of what they would accept.

The research also showed that mobile is an ‘always and everywhere’ medium with 74 percent of respondents claiming to never turn off their mobile, and 92 percent stating that they never leave the house without their phone. A further 75 percent of U.K. users agreed with the statement that mobile is the most personal device they own.

Overall, the research confirms people’s openness to advertising that is relevant to their interests and highlighting their unwillingness to accept push advertising that resembles spam. While that may not come as a great surprise, the report’s conclusion that the biggest obstacle to the success of mobile advertising may be the mobile industry has raised some eyebrows.

Specifically, mobile executives from companies across the mobile advertising ecosystem said widespread confusion over the mobile advertising value chain was the single biggest obstacle blocking the industry from unlocking the vast potential of mobile advertising. In fact, the consensus is that congestion in the value chain has paved the way for inevitable market consolidation, a process that may begin as early as late 2009.

As one executive at a mobile infrastructure provider observed: “Currently, we’ve got a plethora of people offering mobile advertising in the market. But when it starts to become mass-market and reaches volume, then many of those players [ad serving companies] now will not be able to translate into that volume. So, you’re going to start seeing those players just sort of die away because when mobile advertising is serious business, then you’re talking about millions of adverts and not just a few hundred thousand.”

Amid this confusion, it is virtually impossible to gain a sound understanding of the mobile advertising business models. To help the industry build a market and encourage the creation of a healthy ecosystem, the report offers insights into the value chain, the functions individual players must perform to enable brands to connect to people on their mobile phone, and the opportunities for companies to play multiple roles in the value chain in order to build core capabilities and deliver value-add.

What does the future hold? Unsurprisingly, although the report advises companies to collaborate (not compete) until the mobile advertising market has matured and business models have emerged, many of the executives interviewed revealed strategies to assert their dominance in the value chain by trying to squeeze players to their left and right into more peripheral roles.

My take: the value chain will continue to be an issue and become more complex and fragmented. What should the players do in the interim?

•    Brands: Consult with creative and media partners on ways mobile can improve effectiveness of your campaign and integrate it with other media such as online campaigns.
•    Media agencies: Get your head around mobile! Build partnerships with mobile operators and publishers to gain experience and get a feel of the current possibilities of mobile for the brands you work for.
•    Operators: Tactically deploy mobile advertising capabilities as a way to protect core revenues, but know what your core competences are and what other parties do better: outsource ad serving and sales.
•    Infrastructure suppliers: Facilitate. Be an active part of the mobile advertising ecosystem by orchestrating the capabilities in your company and through the ecosystem such as operator- and 3rd party applications.
•    Application companies: Be creative and innovate. Work with operators to create opt-in databases and follow-up CRM schemes.

          

Tags: Comverse, Mobile Advertising, Mobile Advertising U.K., Mobile Marketing

This entry was posted on Sunday, September 13th, 2009 at 8:00 pm and is filed under Featured. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.