Building Great Brands in the Mobile Age

Posted on November 21, 2014
By Shamala DN

Time For Advertisers To Open Up To The Mobile Reality?

There are close to 7 billion mobile subscriptions worldwide, which is equivalent to 95% of the world population. The number of mobile phone users are estimated to be 4.5 billion while the number of Internet users is 2.7 billion. These staggering numbers are eye candy for a marketer as these demonstrate the enormous potential for brands seeking to engage their consumers.

The ubiquitous nature of mobile, which blends personal and professional lives, provides endless opportunities for brands and marketers to reach their target consumers base. Advanced handsets, cutting-edge technology and better bandwidth delivers highly insightful customer insights and intent on their buying and decision patterns.

Although smartphones and tablets have existed as advertising mediums for less than a decade, mobile marketing trends during this period shows a rapid evolution of the advertising landscape. Interestingly, the exponential growth of mobile and smartphone adoption has not witnessed a corresponding increase in mobile ad spends. The amount of time spent on mobile media consumption is disproportionate to the advertising share on mobile. According to eMarketer, American adults spend roughly one quarter of their media time on smartphones and tablets, compared to just 2 percent on newspapers. This year's projected mobile ad spending growth will raise the medium's share of the ad market to only 9.8 percent, compared to the current figure of just under 10 percent spent on newspaper advertising.

Advertisers spend 17 cents on TV for every hour of consumption by a U.S. adult, while they incur 83 cents for the same time spent on print. Mobile costs them just 7 cents for the same duration. The UK ad market is aggressively embracing online advertising along with the rapid adoption of mobile advertising. eMarketer estimates that while mobile will make up 21% of UK adults’ time spent with media in 2014, mobile ad spending’s share of total UK ad investment will only reach 16.3%.

Share of Average Time Spent per Day with Select Media by US Adults vs. US Ad Spending Share, 2014 (% of total)

Source: US Time Spent with Media: The Complete eMarketer Forecast for 2014, eMarketer

Share of Average Time Spent per Day with Select Media by UK Adults vs. UK Ad Spending Share, 2014 (% of total)

Source: UK Time Spent with Media: The Complete eMarketer Forecast for 2014, eMarketer

The Big Disconnect

So if mobile is the platform of the future, why is its ad spending not keeping pace? There are several reasons that contribute to this perception. These include:

  • Fragmentation of mobile devices – The mobile landscape is fragmented with so many different devices and platforms with multiple screen sizes. This can be difficult to provide a consistent user experience.
  • Lack of Standards – The constant challenge for marketers is the lack of dependable standards, methodologies and metrics for measurement for ad solutions.
  • Tracking and Analytics – Digital marketers are used to desktop ads utilizing cookies to track users across websites. There is still a perception that mobile browsers and publishers do not have an analogous method of tracking consumers. The level of understanding around mobile targeting capabilities has clearly not caught up to that around desktop ads.

Mobile – The Game Changer For Brands

Interestingly, the big shift to Mobile has clearly begun despite these setbacks. Brands are steadily increasing their focus on mobile as newer ad units are providing highly innovative formats to acquire or enlighten customers. According to eMarketer, spending on mobile advertising will jump 83 percent to almost $18 billion this year. That compares with $17 billion for newspapers and $15.5 billion for radio. Increased mobile adoption and consumption of content is now being followed by advertising dollars.

The mobile ad tech space has rapidly evolved from basic text and banner ads to richer formats such as mobile video, in-app full screen ads, interstitials, rich media ads and native ads. Real Time Bidding (RTB) has helped to improve accuracy levels of campaigns. Ad impressions have enabled advertisers to bid intelligently on mobile ad inventory in a cost effective and efficient manner. There is immense excitement around location-based targeting as it opens up new possibilities for targeting customers. Responsive ad designs have automated the process of creating an ad to make it adaptable to different screen sizes and resolutions.

As the era of wearable takes shape, it is all set to open an entirely new dimension for brands to reach their customers. These are still early days on this front. Advertisers are recognizing the need to re-define their marketing strategies and integrate mobile deeply into their tactics. The best brands will continue to invest in mobile because it guarantees ROI. We are at a tipping point where mobile-first is a high priority for brands. So get ready for that next big holiday deal to pop up on your mobile, just when you were thinking about it.

Happy Holidays.