Just as the mobile sector finally starts to show signs of significant growth, with mobile ad spend for H1 2012 up 132 per cent year on year according to figures from the IAB and PwC, findings from the latest AdReaction report from research agency Millward Brown look set to curtail the celebrations.
The report suggests that two thirds of UK consumers dislike mobile ads. What’s more, the research showed that although 42 per cent of smartphone/tablet owners consider their devices indispensable, only 17 per cent feel favourably towards mobile ads. Bearing in mind that smartphone penetration is driving growth in mobile ad spend, that is a fairly sobering statistic. But before we all dismantle our sophisticated mobile marketing platforms and go home, I have one question: did we really expect anything different?
Mobile phones are an increasingly indispensable part of our lives, they are extremely personal, always with us, always on. And all the evidence suggests that we are spending more and more of our time using them – figures from Nokia suggest that the average user checks their phones up to 150 times a day. In short mobile phones are the portals to our individual personal worlds. We use them to connect, schedule, plan, research, buy, (sell), work, play, and escape. It’s small wonder then that consumers are likely to resist intrusion of commercial marketing messages into this most intimate of spaces.
So what does this mean for brand marketers, and for mobile as a sector? Mobile advertising, as the Millward Brown study acknowledges, remains a huge opportunity. Figures from FirstPartner suggest that ad spend on mobile in the UK will reach £831.3m in 2013, up 63 per cent on 2012. Ever-improving smartphone functionality and the growth in real-time location based services, mean that mobile is already radically reshaping how, where and when brands engage with consumers. Meanwhile, with the arrival of 4G and faster download speeds, networks will increasingly be able to carry state-of-the art rich media ads that offer creatively immersive experiences for consumers.
While it’s hard not to get swept away by the technical and creative possibilities for mobile advertising, none of it matters unless we can get consumers to care about and respond to ads on their mobiles.
There are a number of issues we need to address to get consumers on board. The first is around privacy. Because mobile phones are so personal, any breach of a consumer’s privacy is likely to feel particularly invasive, and could have a devastating impact for the brand in question. Regular such breaches could be very damaging for the future of advertising on our medium. It’s essential that consumers can trust the main players in the mobile sector - advertisers, agencies, ad networks and exchanges - to be transparent about how their data is collected and not to misuse, or sell any personal data.
In short, we need to be up front with consumers about how their data is used and to offer them easy-to-use mechanisms that put them in control. Given the wide range of devices and networks, and the international nature of mobile advertising, some form of industry self regulation is essential, and we support the efforts of the IAB UK to develop a coherent, EU-wide privacy framework. In the meantime, there is a lot we can do as an industry to address consumer concerns over privacy, by adopting privacy principles as an inherent part of how we design technology/campaigns rather than treating privacy as an inconvenient add-on.
The second issue - and it is a huge one - is that we need to get the technology right. One of the most interesting findings of the Millward Brown report is that mobile users expect mobile marketing to be well targeted and to work, but these expectations aren’t being met. As an industry, we need to address the technical issues around ad serving and disparate inventory silos, in order to improve targeting.
We also need to work with advertisers, creatives and app developers to ensure that mobile display ads, websites and apps are as technically sophisticated as possible, so that when consumers are correctly targeted, they have the best possible experience of a brand’s mobile ad, app or website. And we need to apply the sophisticated learning algorithms that help optimize the performance of mobile campaigns to consumers’ experience of advertising, helping to ensure, for example, that they don’t keep seeing an ad for an app they have already downloaded.
If, and it is a big if, we can solve the technical problems around mobile advertising, we will be better placed to capitalize on mobile’s strengths as an ad medium and to use this to benefit consumers. This can be summed up in two words: relevance and creativity. When it comes to relevance, mobile has the edge over all other ad channels: our technology can pull together information about where a consumer is at a particular time of day and what device they are using.
This allows them to receive content, messages and offers in real-time, which are personal and contextually relevant to where they are and what they are doing right now. The AdReaction report revealed that 29 per cent of respondents were willing to share location in order to receive content and promotions from marketers that are relevant and add value.
Through a combination of ever more sophisticated smartphone capabilities, and the flexibility and functionality of rich media formats, mobile offers brands new, highly creative ways of connecting with consumers, allowing them to physically interact with brands by touching, swiping, moving their phones. The AdReaction report recommended marketers “surprise and delight” consumers with every connection, and provided we get it right, mobile has the technology to do just that.
Mobile phone advertising represents a huge opportunity for brands, agencies and the ad tech companies like mine that have invested heavily in its future. If we don’t want to waste it, we must work together to place the consumer experience at the heart of what we do – after all mobile’s success or failure as an ad medium lies in the palm of their hands.
Sultan Khan is chief executive and co-founder of AdMaxim