Mobile ROI: You get what you pay for
By Richard Ting
Apple recently announced its 500 millionth application download from the App Store in less than a year. Bango research shows that mobile Web surfing in the United States is growing at a faster pace than in most other countries. All signs point to a sunny future for mobile data consumption. So why is mobile marketing stuck in a cloudy haze?
Quite simply, because marketers aren't investing enough -- especially in media buys. Most marketers are hesitant to allocate larger budgets to mobile initiatives without proven case studies showing effective results -- a situation exacerbated by the current state of the economy.
Yet agencies are hard pressed to create highly effective and innovative mobile campaigns with impossibly small budgets.
I would argue that now is the perfect time for progressive companies to invest more in mobile: the medium is still largely uncluttered, and there's untapped potential to build relationships with customers.
In the initial years of the Web, we faced a similar dilemma. It was difficult to prove ROI, but the pioneers, such as Nike and Coca-Cola, were able to establish a voice, presence and relevance before their competitors did. They learned from early pitfalls and gained a strong lead that many have been able to maintain to this day.
We are at a comparable moment for mobile. The potential is there, but it will require courageous brand marketers with proper investment to take the plunge.
Not surprisingly, small budgets often lead to small-scale initiatives that are not fully integrated with other media channels. In a lot of cases, the budgets are not enough to fund even the smallest of mobile media buys.
Without an adequate media investment, most mobile campaigns stand little chance of thriving.
Sure, a brand may score a one-off media-grabbing campaign such as Dove's Evolution in the viral video space or Burger King's Whopper Sacrifice in the Web space, but chances are slim for most brands. The long-term reward comes with understanding the medium and how people are using it.
If you ask most brand marketers what they want from mobile initiatives, many will cite high-volume traffic numbers found on custom-built Web sites in addition to higher opt-in rates and higher transaction conversion rates. All of that comes at a cost.
For instance, when a brand and agency kick off a Web campaign, the following ingredients typically go into making that campaign successful: online media buy, cross-channel integration, CRM integration, strategy, planning, and design and build phases.
For mobile ROI to begin to be taken seriously, mobile initiatives need access to the same ingredients as the Web.
In some cases, mobile initiatives will have access to most of these ingredients, but due to budget limitations, the ingredients are simply spread too thin.
In the last several years, I have worked on some extremely well-ideated and -designed mobile initiatives that surely would have garnered greater attention and reach with a bigger mobile media spend or cross-channel integration.
I am optimistic that in 2009 brand marketers will begin to open up the purse strings. When that happens, here are five key points for agencies and marketers to keep in mind to maximize their ROI:
1. Create experiences that provide utility. This leads to higher engagement and higher ROI for advertisers.
2. Integrate across channels. Benefit from the halo effect of the other mediums.
3. Measure, track, analyze. Proper analytics allow you to measure your initiatives and improve them.
4. Buy mobile media. Use mobile media to generate that initial push of awareness.
5. Build a mobile database. Building an opted-in mobile database of some of your brand's tech-savviest enthusiasts could be one of the most valuable components of a mobile program.
Richard Ting is executive creative director and vice president of mobile and emerging platforms at R/GA, an Interpublic Group interactive marketing agency in New York. Reach him at .