It was an eventful week but I shall pick Google’s acquisition of AdMob as my top (well, maybe only #2) item. A game changer, the final acknowledgement of the power of mobile, there is a lot one can find to describe the deal and for all the right reasons:
The acquisition of Admob by Google shows Google’s commitment to “mobile, mobile, mobile”, which in itself is encouraging for the sector that is – despite a number of larger players evolving and despite the still relatively recent paradigm shift initiated by the iPhone – still fledgling. That in isolation makes it great news for the mobile sector!
From Google’s and Admob’s respective business perspectives, it appears to make eminent sense, too (and I am not privy to their numbers): Admob will be able to bulk up and cement its leadership position in the segment. Its inventory and back-end ad management will be able to dip into Google’s vast resources, which is great for them. Google probably realized that Admob’s strength meant that they would be difficult to beat. And who you can’t beat, you shall join (or, in Google’s case, buy) them. For Google, it is a smart move as it gives them critical mass in an ad format where they have not nearly been as dominant as for other formats and gives them access to a lot of eyeballs.
The eyeballs bit is, however, maybe the concerning piece of this: Google makes 97% of its revenues from its legacy business using AdSense, AdWords, etc. Nothing much has changed for a couple of years and it has miserably failed with a couple of acquisitions (anyone remembering “the 2 kings have gotten together” [1:00]?), YouTube is a great site but did Google maximize it (yet)? Probably not. Jaiku was more than just a worthy competitor to Twitter; they were history the moment Google bought them (well, it was eventually moved to Google’s App Engine but no one seems to have made much use of it).
As much as I admire Google, the company (where – get this -, when in new product development, you are allegedly judged by the number of failures you managed to produce! Very, very good and gutsy thinking!), it has to get its head around more “modern” approaches to marketing and engagement. Text and display ads alone won’t cut it in the long run… But, in any event, the combination with AdMob will give Google a little bit more of a runway to get this right and – smart companies both of them are – I am sure there is more than enough brain cells to get it right. All good!
A lot is being said about mobile marketing, mobile advertising, capturing “consumer’s” imagination (if not only their eyeballs). And everyone says: “yes, I get that, social, mobile, always-on, always with them, cool!” Online ad spend outstrips TV already (at least in the UK), and mobile is arguably the next big thing; it is so much cooler, too: personal, accessible, always-on!).
So how do you execute? Banner ads? Text ads? Virals? “Ah, yes, virals are cool, I heard about them!”
There’s a busload full of mobile advertising networks out there, blind, premium blind, premium (check here for a great overview). And what do they do? Well, banner ads, text ads, the usual. Does it work? Anecdotally, sort of… Most developers and publishers I know that engage in this sort of activity make their money in two ways: either they are being commissioned by an advertiser to do it (good because you’re being paid!) or they use it as complementary (sic!) revenue; on a stand-alone basis, it would not feed them.
Why is the conversion not soaring? After all, mobile allows for unprecedented targeting (IF you do it. See here how not to do it): users have their phones always with them, it is always on, you can fall back on historical behaviours, etc, etc.
I would posit that it is because most advertisers still think of it in terms of consumers: beings that sit on the other (sic!) end of the message and who consume whatever I, advertiser, want to tell them. It is not, alas, true engagement, and this is where arguably the future lies.
So how do you engage? Many options. A good one is by being sincere (Zappos, the online shoe retailer that was recently acquired by Amazon, is a great example). Another one is by engaging rather than preaching. Not so easily done with banners. Easier done with something more interactive. Such as – an example – games and apps. On Apple’s app store, there are some great successes for this type of thing: German car manufacturers seem to be good at this! Audi did one, German developer Fishlabs did a couple of games for Volkswagen, Artificial Life for BMW, and then there is Waterslide Extreme, which is basically a Barclaycard ad (and badly executed: they could so easily have accommodated the RFID function, which the original cinema and TV ad is meant to promote; alas, they ignored it!) which despite its shortfalls was incredibly successful. But these are exceptions to what I think might well become the rule. On the app side, there are e.g. Pizza Hut and Gap that were recently featured (for free!) in Apple ads. Wow!
It seems obvious when you think about it: games truly engage (users – not consumers! – interact with them actively) and they can do so in a much more subtle manner (less invasive). At the same time, the user (not: consumer) spends a lot more time with the brand than with a banner ad.
It is, alas, a space of unknown dangers and unprecedented adventure: never-before seen creatures (scil. formats) and strange folks (scil. developers) roam weird landscapes (scil. mobile platforms). This is how brands and their agencies often experience mobile. They "get" it, don’t get me wrong but they are still fairly unfamiliar with it. And because the big pots of gold sit with the brands and they don’t want to risk cutting access, they’ll rather (and rather too often) stick with what they perceive as the trusted old paths. It’s not so good then that the freshest fruit grows on the trees in this new land and no longer in the wastelands of banner ads…
Watch this space then. It will only be a question of time (I hope) before we’ll be seeing a new wave of non-intrusive, interactive, fun brand engagement. And games and apps will lead the way!
The good folks of Millennial Media gave me a sneak preview of their May Scorecard for Mobile Advertising Reach and Targeting (yes, they call it SMART…), which looks at the US mobile advertising market, and then my daughter broke her arm and my blogging activities (and a lot of other things) took a time-out…
Anyway, Millennial reaches 73% of all mobile Internet sites (which they claim makes them biggest), which makes it a fairly comprehensive overview. And there is a lot of interesting data buried in this brief piece of research.
So, for May 2009, the handset on which most ad impressions were recorded was not the iPhone but the Samsung “Instinct” (otherwise known as the SPH-M800). The iPhone was on #2 ahead of the Blackberry Curve. A full list of the handset breakdown looks like this:
On the advertising front, we’re seeing some interesting metrics on cost per engaged user depending on the various measures included. Advertisers appear to be trying out a variety of approaches. Interestingly, the cost per engaged user for a campaign focused on a specific demographic has dropped very significantly (by ¢0.28 or c. 45%). Is this a sign of a higher take-up? Here’s a graph showing the details:
The mix of campaign activities is also interesting and shows that the sector seems to be coming of age. C. 60% of the campaigns (or committed budgets) were dedicated to the mobile web (browser) with the balance using some form of dedicated applications. The app store has its own category already and use of it (or rather iPhone apps) rose by 4 points to an overall 13% of campaigns, which is significantly higher than the iPhone’s footprint. However, I am sure more than 13% of art directors and their clients use iPhones, so maybe this is why. Or of course the iPhone could simply be a device (and the apps to go with it) that makes it easier to engage with users. Oh, what news… So here’s the final graph I’ll share with you, namely a chart showing the splits:
It is another one of these examples where PR speak dilutes the message till no one knows what it actually is but here goes: Mercedes has instructed an agency to increase its use of mobile phones for marketing purposes, and the good folks from the PR agency do not forget to mention that “no other automotive manufacturer in the UK has implemented and maintained such a large mobile presence” So: what does that mean?
They want to “encourage active response from traditional advertising such as poster, print, TV, and DM, via mobile text calls to action, driving users to Mercedes-Benz mobile sites.” But how, with what, what for? I don’t know and they don’t say. Now, mobiles and mobility – there surely is a common theme here somewhere. But will they do more than inform customers via SMS and try this Bluetooth trial? I would really wish they’d be somewhat more aggressive in communicating initiatives.