How to budget and time mobile marketing campaigns

By Michael Becker

Trying to figure out how to cost out a mobile marketing program and how long it is going to take from start to finish and launch can be a challenge.

It is important to understand where the key cost centers are in setting up and running a mobile marketing program. It will also give you a sense of how much time you should budget to get a program launched.

Choosing your approach
When considering costs and schedules for your mobile marketing programs, you first need to take into account which strategic approach you plan on employing to get the job done.

Are you going to 1) take the agency approach and have someone build and run your campaigns for you in an ad hoc/one-off project based model, or 2) are you going to go to the opposite of the spectrum and do everything -- strategy, creative, execution, technology build out yourself -- or 3) will you take a hybrid approach and find a middle group between these two poles?

Once you have chosen your approach, you can figure out which costs elements with which to directly concern yourself.

Understanding the costs
If you are going to run ad hoc programs, then you can simply treat all your mobile marketing programs as variable cost -- that is, you have no upfront investments and you simply pay for the services as you use them.

However, if you are going to invest in running mobile marketing programs yourself in a do-it-yourself or hybrid model, you will want to consider the upfront investments you will need to make to support your initiatives.

Below you will find a high-level overview of the cost drivers for both upfront mobile marketing program investments and program variable fees.

Upfront mobile marketing investment cost centers
There are four cost centers you will want to estimate when considering your upfront investments to setup your mobile marketing infrastructure if you are considering using a do-it-yourself or hybrid approach to launching mobile marketing programs for and within your business.

? Strategy and resource. You will want to estimate the costs for your team, their training and the development and maintenance of your strategy.

? Mobile marking platform and application licenses. You will want to plan for the fees you will pay to obtain and gain access to the application logic that will power your mobile marketing programs.

On average, depending on the functionality you license, mobile marketing application fees will range between some few hundreds of dollars to a few thousand dollars per month.

In addition to monthly fees, for access to a mobile marketing application platform you should plan on paying initial, one-time account setup and training fees as well.

? Connection aggregator fees will apply if you decide to go it alone and build out your own application logic and connect directly to a connection/messaging aggregator.

Connection aggregators are companies that provide application players with messaging connectivity to wireless carriers. A connection aggregator bind will cost you some thousands of dollars per month. You have to pay for any application logic extra by building it yourself or sourcing it from a third party.

Note that the connection aggregator fees are typically included in the mobile marketing application provider platform fees. This is an added benefit of working with an application provider over going it alone.

? Common short code leases. If you are going to run any text messaging mobile marketing programs you must lease one or more common short codes. Nearly every mobile marketing program -- at least the good ones -- use a short code as a core piece to the program.

You need to do this ahead of time -- that is why it is listed in the upfront investment section -- because it takes anywhere from eight weeks to 12 weeks to get a short code activated and certified for use and four weeks to six weeks to get a new campaign certified on an already activated code.

You do not need to get certification if the code has already been certified for a specific type of mobile marketing campaign. You only need to do so for new campaigns or if the campaign user flow changes.

To this end, short codes are a valuable asset to be nurtured.

Sort code leases nationwide cost $500 per month for a regular number and $1,000 monthly for a vanity code. They are billed quarterly.

You may be able to rent a short code from your application provider or connection aggregator. However, they will probably charge you a similar fee.

Variable mobile marketing program cost centers
Depending on who you are working with, you may be quoted a single number for your entire mobile marketing program -- for example, $25,000 plus the traditional media and retail promotion and advertising fees -- or you may get a breakdown of the variable costs.

The following provides a list of the cost elements in the typical mobile marketing program.

? Program strategy development: All the activities needed to conceive your campaign and lay out the plan

? Creative concept development: All the design activities associated with your campaign

? Content licensing and/or creation: Licensing fees or design fees for any content you may use for the campaign such as images, ringtones, videos and news feeds

? Mobile marketing application/platform: If you are not already licensing a platform or have not built it yourself, these are the fees you will pay for hosting and reporting on your campaign during the entire period of your campaign

? Tactical execution of a program: This includes creative, program certifications as needed, technical implementation on mobile marking application platform providers, legal costs -- if you're running a sweepstakes program -- and any custom non-recurring software development that may be needed to tailor the application(s) to your specific campaign requirements

? Transactional items: Messaging traffic comprising SMS, MMS and email, Internet and mobile Internet page views, advertising page views/click-throughs, content downloads, IVR minutes, content royalties and images recognized

? Carrier-specific charges: You will also want to double check if there are any carrier-specific charges -- for example, uplifts on text messages or tariffs on promotional content downloads

? Traditional media and retail channels: The fees for promoting the program in any traditional media channels

Here's a hint. You can often reuse portions of the strategy, creative and any custom software and content development in one program for future programs.

If you keep this in mind, you can end up saving yourself quite a bit of money and time down the road as you roll out new and derivative programs based on what you have already done in the past.

Getting to know the timelines
As for getting a mobile marketing program launched, while technically you can do it in a matter of minutes if you have the right application provider, you should realistically plan for it to take 12 weeks to 15 weeks to get a new, typical, campaign launched.

The timeline will vary primarily due to the management of short code activation and carrier certification requirements. If you are borrowing a code from an application provider that already has a program certified, then the timelines can be much faster.

Mobile marketing is a fantastic practice that can be used to generate intimate, informative, entertaining two-way interactions with a person.

Mobile marketing programs have been known to have better brand recall -- 3 percent, 6 percent, 9 percent, 20 percent and higher response rates depending on the nature of the program and the target audience. It is a valuable practice, one that you can master, and very cost effectively"which is important especially given today's financial times.

Learn how to minimize the costs and maximize the value of your mobile marketing programs and you will be on your way to significantly contributing to your business' bottom line through the use of mobile marketing.

Michael Becker is vice president of mobile services at iLoop Mobile, San Mateo, CA. He is also vice-chairman of the Mobile Marketing Association. Reach him at .