Replace That 'Inefficient' Internet Spend with Mobile

At the MMA show yesterday one of the better panels was "Opportunities for Mobile Marketing & Advertising in the U.S. Market." It was a broad discussion about a range of issues, as the session title suggests.

Toward the end of the discussion there was a question about where mobile budgets come from. What was striking to me was that the panelists argued that marketers should take some of their "under-performing" Internet budget and allocate it to mobile. This was very much the same language and case being made for shifting budget from traditional media to the Internet.

Panelists were touting the better ROI, better targeting and improved response rates in mobile (vs. online). There was a tremendous irony in these arguments, which I've heard so many times about traditional media, now being applied to the Internet.

Google Goes Back to 'Opt-in' in Mobile

When Google first launched mobile AdWords it was an opt-in program: advertisers specifically had to choose to be in mobile sponsored search results. Then, in a fairly well publicized move, Google decided to make mobile an opt-out for AdWords advertisers:

Each ad’s eligibility will be determined by its landing page and only ads with landing pages that can be adapted for viewing on mobile browsers will be shown. You can monitor each ad’s performance via a special performance tracking page within your account called “Performance Data: Search Ads on Google Mobile Search.”

Again, you will not be charged for clicks on these ads until November 19, at which time we will begin charging the usual CPC prices. And as always, you may opt-out of this feature at any time.

The company informed me last week that it has gone back to an opt-in policy for mobile at the present time.

I also discussed with Google the degree to which the desktop and mobile might ultimate become more similar than different, in the context of "full HTML" browsers (Safari, Opera, Skyfire, Mozilla, Android). We'll see. As I've tried to argue in the past, while there are some advantages in that scenario for users there are considerable disadvantages for advertisers -- chiefly because online ads get lost and become very difficult to see.

The iPhone is probably the model of how smartphone browsing will evolve: native applications + full HTML browsing. But that still doesn't solve the problem for advertisers seeking to effectively reach mobile audiences.

Mobile 'Marketing' vs. Mobile 'Advertising'

One of the early themes at the MMA show yesterday was the difference between "mobile marketing" and "mobile advertising." Although different, in some ways the discussion is akin to the distinction between SEO and SEM online. With SEO there's no direct payment to Google, Yahoo, Microsoft, etc. -- though good SEO costs money.

The same is true with "mobile marketing," an example of which is a text-based response option appended to a traditional media campaign. There are fees and costs, but no direct payment to a publisher or search engine. Mobile advertising by contrast does involve direct payments and ad placements specifically on mobile websites.

Mobile marketing has been around for a number of years and continues to gain traction, while mobile advertising is only now starting to take off. The two may overlap (e.g., text that drives users to a WAP site with ads/promotions). Most mobile marketing involves SMS, while mobile advertising can employ or be featured in SMS but is generally looking beyond text to WAP or its successor.

Questions surrounding the distinction kept coming up in various discussions and I thought it was interesting. The intellectual/analytical distinction isn't as important as what's actually working for marketers and where the money will flow accordingly.

When Will 'Mobile Search' Overtake the Internet?

This is a question that has come up several times in the recent past. I've modeled it but it's difficult to confidently predict and depends on how one "scopes" the relevant markets. It matters, for example, whether SMS-based search and voice or just WAP are considered. It also matters if you focus on just the US, the EU or the globe.

For example, a speaker at MMA pointed out yesterday that Brazil has (approximately) 128 million mobile subscribers and roughly 40 million Internet subscribers (3:1), with only 3 or so million of those on broadband. This is a snapshot of non-Western countries and the developing world: mobile far outstrips the desktop Internet.

For people in these regions, mobile and the Internet will be substantially the same thing. While it might take some time for mobile to pass Internet search in the US or Western Europe, in context of the entire world it's not hard to imagine mobile search volumes exceeding the desktop Internet, in the aggregate, within 5-7 years.

Passive Tracking Creates Potential Privacy Nightmare

On a MMA panel about mobile ad agencies, the statement was made that the top things carriers could do to facilitate mobile advertising would be the following:

  • More aggressive data plans, including flat rate plans (which now exist)
  • Open up their billing and user data to ad targeting (Sprint has done this to a degree)

This second suggestion raises important and contentious privacy issues, which were picked up in a later mobile social networkingComo todos los casino online que son de alto nivel, Casino Del Rio tambien utiliza el software de Playtech para el desarrollo de juegos de casino online, y brinda atencion personalizada las 24 horas alos jugadores en casino online durante todo el año. panel. With GPS and related “passive” or automated tracking that a number of mobile social networks have proposed (e.g., Whrrl), simple and transparent privacy rules are strongly implicated -- or these companies will face a PR nightmare and potential regulation.

Nuance OVS - Promises Voice Search for iPhone in August

No pricing is available but Steve Chambers, president of the Nuance Mobile business unit has demonstrated Open vSearch (or OVS) speech-enabling Web search on the iPhone. A demo can be seen here. While it is not substantially different from the offerings of Vlingo, V-ENABLE or Microsoft Live Search in terms of using speech input and distributed speech processing (DSP) to recognize utterances and populate a search box, it is no coincidence that the announcement coincides with Apple's World Wide Developers Conference (WWDC) here in San Francisco.

It was at WWDC yesterday that Steve Jobs announced the new, 3G-compliant, less expensive iPhone and began enticing Apple's true believers with the capabilities of a faster data link, longer battery life, GPS and a larger user base (thanks to the lower price). We expect to see some formidable new speech-enabled multimodal applications for the new generation of iPhones. It's impact far exceeds the share of the mobile subscriber base.
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P.S. from Greg: I've been using the Microsoft Live Search application with voice much more recently and have become very pleased with the performance. Voice/speech of course addresses many of the shortcomings of keypad entry on mobile phones, although it's imperfect. It also helps drive consumer search volume as well because of the reduced "friction."

Local Matters and Apptus Bolster Canoe411 for Qubecor MediaPages

In a joint press release from Denver, CO, and Lund Sweden, IYP and enhanced 411 aficionado Local Matters and e-Commerce specialist Apptus announced that they have worked together to bring new content and capabilities to www.Canoe411.ca, an Internet Yellow Pages and local search engine operated by Quebecor MediaPages.

A "beta" version of the site has been operating since April. As it moves out of beta status, it becomes the official online directory for the Canoe.ca network, which reportedly attracts 8.8 million unique visitors each month. The combination of technologies from Local Matters and Apptus is to provide mechanisms for local merchants to target advertising to local buyers. MediaPages published printed directories in 20 or so smaller communities in Canada, but will grow its business by expanding into Montreal and Quebec City. Integration with Canoe411.ca will give the MediaPages sales force more opportunities to sell products and services that rely on targeted search-based marketing through the Canoe411 Web site.

T-Mobile Invests $6 Million in DeCarta for LBS Insurance

T-Mobile's venture arm has invested in geo-software provider DeCarta:

Location-based services are experiencing rapid adoption as consumers are using new applications that take advantage of location-enabled handsets. Location and mapping services have become a central ingredient in most mobile Internet platforms. deCarta's geospatial software platform gives mobile LBS application developers and mobile operators the ability to quickly build and deploy applications that integrate a wide variety of map and data sources to provide complex local search, navigation, mapping, social networking and spatial search functions.

deCarta's technology is ideal for the full continuum of mobile LBS solutions including off-board, server-based applications offered by mobile operators through to "connected navigation" -- the ability to integrate personal navigation devices and smartphones through real-time two-way mobile connectivity to a variety of dynamic data sources and local search services.

DeCarta clients have included Ask.com, AT&T, Google, Hotels.com, Maps.com, Qualcomm, Sprint Nextel, Sage-Quest, Verizon, Yahoo!, Zillow.com. T-Mobile also recently invested in Whrrl.

Previously, personal navigation device maker Tom Tom acquired TeleAtlas, while Nokia acquired Navteq.

Carriers see mapping and related data services as strategic in the segment, so I would imagine there will be other such investments, leading ultimately to acquisitions.

Adidas 'Brotherhood' SMS Case Study

I'm at the MMA conference in New York. Adidas presented an interesting case study involving mobile marketing. Without going into too many details, the company integrated TV and SMS. The tag at the end of the TV commercial ("The Brotherhood") was an SMS call to action. What was significant is that this was the first time that Adidas did a TV campaign without a URL at the end. Yet the company said that users/viewers went to the Adidas site regardless (the brand triggered a navigational search).

People who sent in texts received phone calls from basketball players involved in the campaign, as well as a follow-up text. This voice/text "engagement" continued for approximately a month with calls from different players happening every several days. These voice messages are like personalized radio spots.

Because the kids had effectively "opted-in" by responding to the TV ads, these follow-up calls did not appear as spam.

In the campaign, Adidas also used text with outdoor and print, as well as TV. It used different codes for out of home, TV and print enabling all these different media to be separately tracked.

The SMS component of the campaign was extremely successful with the target demographic: young men who are heavy text messaging users. This isn't mobile "advertising" but will be increasingly common in traditional media campaigns both as a way to extend the campaigns and to "personalize" them. One of the interesting issues "going forward" will be when to emphasize mobile and when to emphasize the desktop Internet and how to most effectively integrate both.

The repeated theme was integration: "don't use mobile as a stand-alone device" or channel.

Video vs. TV on Mobile Phones

I remain quite skeptical of the potential for mobile TV in the form of an "upsell" to subscribers. Video on mobile devices is a different matter however. People are watching video to varying degrees and will do so in increasing numbers over time.

In the US the iPhone leads the way; almost 40% of current owners watch video. Then again the device is intended as a video iPod. Other phones, such as LG, Samsung and HTC devices will catch up, not to mention the Blackberry Bold and the forthcoming "Thunder." But improved user experiences and video quality won't necessarily translate into mobile TV subscriptions.

Now SlingMedia has adapted the Slingbox for the iPhone so that one can watch one's home TV on the device. It's not going to be available to the public for awhile. But it offers a glimpse into what may become a very popular app for the Apple device as people access their home programming on the phone.

However, paying for a mobile TV service (such as AT&T's MediaFLO) is still a pipe dream for US carriers.