Brands increasing mobile spend despite economy: Mobile Marketing Day panel
NEW YORK " Mobile marketing is no longer a year away -- it's here and now and being practiced by Fortune 500 companies as well as midsize businesses looking to reach consumers on the go, despite the economic downturn.
Mobile is the most personal channel yet, and more marketing dollars are making their way there. Those were opinions expressed by "The State of Mobile Marketing" panel at the Direct Marketing Association's Mobile Marketing Day in New York, moderated by Mobile Marketer's Mickey Alam Khan.
"We see a lot of brands that have executed mobile campaigns in the past coming back this year," said Jeff Arbour, senior vice president of North America for The Hyperfactory. "Marketing budgets have been slashed, but ROI has been so high with mobile campaigns that they're actively looking to increase spend this year.
While some brands are hesitant to invest in mobile because of constrained budgets, those that have set and reached benchmarks with mobile campaigns are continuing to invest in the channel.
Available mobile marketing vehicles include targeted banner advertising on publisher sites, mobile Web sites, loyalty programs through SMS opt-ins, in-game ads, mobile video, mobile commerce, mobile search and click-to-call lead generation efforts.
But marketers have to be aware of wireless carrier requirements, double opt-in rules and what constitutes a legal consumer list in mobile marketing.
"Brands usually think about the technology first, but don't forget the rules of marketing and what you're trying to achieve, think about how you're going to utilize mobile to solve a problem," Mr. Arbour said. "Activate print media with SMS, drive leads via the mobile Internet and get consumers to offer up information.
"The mobile space is less cluttered than online, which offers a better opportunity for your messages to be seen and in turn acted upon," he said. "Come up with what your goals and benchmarks are, come up with a strategy, and don't worry about the technology."
Brands can use social networks -- both on mobile and wired Web -- as a way to initiate conversations with consumers and get them to opt in to an SMS database.
Click to call is also a useful function, depending on a brand's goals. Mobile can also be used to take the load off of call centers, which are really expensive.
"Mobile has reached critical mass," said Nic Covey, director of insights for Nielsen Mobile. "Last year we hit audience levels for short codes and the mobile Internet to make mobile a viable opportunity at a scalable level for advertising."
Looking at mobile data, there are 267 million total subscribers in the United States, 213 million of which use text messaging, according to Nielsen Mobile.
"In the U.S. today there are 115 million with access to mobile Internet -- these are people paying for the mobile Web, but not necessarily using it," Mr. Covey said. "The actual number of users is much smaller, 48 million.
"There is still a large gap between those paying for mobile Internet access and those actually using it," he said.
There are 64 million total people who download mobile content, with 31 million downloading audio, 29 million getting applications, 16 million seeking premium SMS and 14 million downloading games.
As for mobile Internet usage, 43.6 million access it via carrier portals, 31.2 million use mobile email, 19.7 million access weather sites, 19.6 million news and current events sites and 16.3 million use mobile search portals, also according to Nielsen Mobile.
In terms of short code audiences, Google, Facebook and 4Info receive the most text messages, while Coke has found success with its My Coke Rewards SMS platform. ChaCha is the fastest growing mobile search provider, according to Nielsen.
The Obama campaign got 2.9 million people to opt in to an SMS database.
As for mobile commerce, eBay is the number one mobile retailer, with Amazon and Apple not far behind.
"About one-third of consumers are open to the idea of mobile commerce -- they don't seem as reluctant as we thought," Mr. Covey said. "People are willing to put their credit card information into their phone or trust carriers to bill them.
"We know that social networks are going to be a big part of mobile, with contextual advertising around content," he said.
Many panelist offered optimistic views of the state of mobile marketing, despite the dire economic forecast.
"Brands like Jameson and Nestle are investing in mobile at the same or an even greater level this year, because it provides direct interaction, direct response from consumers, and it provides a return on investment, which is critical in the current environment," said Eric Harber, president and chief operating officer of HipCricket.
"Brands are also bringing on new customers with mobile campaigns," he said. "SMS resonates with people, people get it -- the mobile device is the fastest growing communication vehicle in history, and it has twice the reach of the Internet, so people are getting serious about it.
"Brands are saying, ?We have to be using mobile -- why wouldn't we be communicating with our customers the way they're communicating with each other?'"
Quick-service restaurants such as Subway, Pizza Hut, Papa John's, Jack in the Box, Burger King and McDonald's have all run successful mobile marketing campaigns.
Jiffy Lube ran a mobile campaign with a keyword-short code call-to-action for a contest to win a year of free oil changes.
The ones who didn't win were offered a mobile coupon for discounts on wiper blades, a tire change or an oil change. The coupons had a unique code used at the POS to track metrics.
According to HipCricket, 50 percent of people who redeemed coupons were new customers, whereas traditional marketing means average 20 percent new customers.
A common theme was the need for mobile to be part of the fabric of brands' regular marketing plan.
"Compared to other channels, I'm optimistic about mobile marketing, because it delivers ROI," said Amy Mischler, vice president of identity and brand services for dotMobi. "Mobile delivers a cost per lead that's one tenth of what online can produce, which is really important in this economy.
"Mobile technology is improving, consumers are more familiar and comfortable and the mobile space is bright for direct marketers," she said. "45 percent of executives say mobile will increase as an overall part of their marketing spend -- a large majority are not shrinking their mobile budgets, they're growing them despite economic pressures.
"It's not necessary to talk about a huge financial commitment -- you can be a very small business and still take advantage of mobile opportunities such as mobile Web sites, short codes, text messages linking to the mobile Web, display ads and search playing into a brand's mobile Web presence."
Jaguar recently ramped up its mobile initiatives by buying more impressions on mobile sites to promote its new luxury XF model. The automaker issued calls-to-action for consumers to request a brochure and request locations of local dealers via its branded mobile Web site.
The results were 1.1 million page views, 190,000 videos viewed, 83,000 wallpaper downloads and 6,600 dealer requests.
"2008 was a pretty huge growth year for mobile in terms of spend," said Paul Palmieri, CEO of Millennial Media. "There is a migration of user behavior off of the Internet onto mobile devices, making mobile an imperative.
"Mobile has ability to target by geography, which has arrived to mobile a bit earlier than online," he said. "Cost per engaged user is a metric that does extremely well on mobile -- CPM is double in mobile, and while reach is maybe half as much, the interaction rate so much higher on mobile."
Insight Express' Mobile Norms vs. Online Norms study found that mobile campaigns have five times the brand impact of online campaigns.
Marriott generated 1.2 million hotel bookings in one quarter of spending in mobile, with one-third of those bookings for the same night they received the offer via SMS.
"Mobile can deliver interactivity with consumers on an ongoing basis," Mr. Palmieri said. "2009 is going to be a big year for mobile."