I have a question for you.
How many TV advertising campaigns can you remember from the past year or so? That really made an impression on you? That made you smile, think or that in some way indelibly stamped the brand upon your mind?
OK, hold that number. Now, ask yourself the same question about TV advertising campaigns from, say, 20 years or so ago. Now compare the resultant number from that exercise with the previous one. In the overwhelming majority of cases, the second number will be far higher than the first.
This is not necessarily the result of any dearth in advertising talent; not that campaigns have become duller, less imaginative less gripping. It is because fewer and fewer people are watching them. This is due to a multiplicity of TV channels – which has fragmented viewing audiences – and to a shift in viewing habits, itself in large part to the rise of the PVR (removing at a (key)stroke the need to spend ages on your knees ferreting around for an E180 tape with an hour of space left on it).
Less and less viewers are watching the bulk of their TV programmes “as live”: River Cottage is screened at 8pm on Channel 4 in the UK this evening, but (a) I will be watching it tomorrow night and (b) I will be pushing the fast-forward button to skip past the advertisements. (Note to self: text Tracy to ask her to set the PVR because I’ve forgotten…)
The upshot of all this is that advertisers are becoming less convinced of the efficacy of TV as a medium through which to distribute their message: advertising rates have fallen sharply, a decline exacerbated by a global depression which has resulted in further constraints on overall advertising budgets.
However, brands still need to get that message across, whether that message is to encourage us to drink a pint of milk a day or to reaffirm that Beanz meanz Heinz, and as a result they are seeking out alternative media. And this is where mobile comes in.
There are nearly 4 billion active mobile subscriptions worldwide. Unlike TVs or desktop PCs, they typically only have one user, offering the opportunity to personalize advertising; also unlike TVs and desktop PCs, they are typically carried by that user at all times, allowing advertising to be pushed to the user 24/7. They also allow users to respond instantaneously to advertising, via clickthroughs or a text; and they allow those responses, and response rates, to be measured to previously unimagined levels of detail. At a time when advertisers are transitioning from above the line to below the line business models, from reach to engagement, these facilities make the mobile an increasingly attractive proposition.
Mobile advertising budgets are currently a drop in the ocean compared with global adspend of more than $500 billion. Even by 2014, we anticipate that mobile adspend is unlikely to far exceed $5.7 billion – just over 1% of the total. That said, mobile remains a nascent medium: consider how long it took the Internet to gain a substantial share of the advertising pot.
But, unlike budgets on most rival media, adspend on mobile is clearly growing, and growing fast.
One might say: the future’s bright, the future’s mobile…
Tags: mobile advertising
even if you have permission to SMS / MMS the phone user with marketing message, what is the tipping point when consumers no longer will want any form of marketing messages being sent regardless of the company trying to communicate with them. I take the internet has an example, at first it was good to get e-mails alerting you to new product range or discounted flights/holiday but now people set filters in an attempt to weed out the rubbish messages - will this happen also on mobiles ?
Garry
If those operating the advertising networks are wise, they’ll recognise that excessive advertising - even targeted advertising - will ultimately have a negative effect and that consumers will opt out of ad-funded services. The most successful ad-funded services will be those which offer a moderate amount of highly targeted advertising. Otherwise, you’re just going down the road of sending out bulk SMS to an entire subscriber base, which are irrelevant and irritating to most recipients.
apologies for my naivity on this matter, but are there ‘rate-cards’ from mobile advertising agencies today ? Plus, you refer to ad-funded services, what is your definition of such a service ? I agree that advertising will need to be targetted and relevant. Garry
In terms of “rate cards”: advertising networks either set fixed CPC or COM rates, or else offering a bidding system (with fixed minimum rates) within which advertisers can bid for placement within given content. Advertising within mobile TV is perhaps the closest to traditional TV advertising, in that the service providers make an estimate of the relative number of eyeballs for a particular piece of content and price slots accordingly.
The thing to bear in mind is that many services will be ad-funded to a degree, but a significant proportion will utilise advertising as a secondary source of revenue - certainly in the medium term. Even where advertising is a primary revenue stream, some providers - such as dating or social network sites - are augmenting ad revenues with sales of virtual items etc.