Mobile phones offer a platform to marketers to directly connect with consumers in their personal space. However, many marketers are yet to join the M-bandwagon though early adapters have seen positive responses. For the past couple of years, the industry has been waiting for a breakout year – will 2013 finally be the year when mobile advertising reaches a tipping point, asks Simran Sabherwal
You are in a supermarket, walking down the aisle with your grocery list – not in your hand but on your phone. With just a flick of your wrist you scan whatever you want, edit products you don’t need and head to the cashier to pay for purchases. No need to drag the trolley or carry a heavy basket – your shopping is done on your phone and all your purchases are ready at the check-out point.
The above scenario is not part of any sci-fi film, but just a glimpse of how our lives could be in the future, with our mobile phones taking centrestage, and literally taking over our lives. With a projected 165 million mobile internet users in India by March 2015, and people utilizing mobile for social media interactions and data consumption, the mobile will be the first device for users. But what is the marketers’ strategy to communicate with this huge market and are they utilizing the mobile platform efficiently as part of the marketing mix?
Most experts say that while marketers no longer need to be convinced about advertising on the mobile platform, many have still not realized the opportunities that this space offers and how best to use them, and that these marketers need to be handheld through this process. According to Rohit Dadwal, Managing Director, Mobile Marketing Association, Asia- Pacific, “Mobile advertising is yet to reach its full potential in India as well as in other parts of the world. Marketers are still trying to find the best way to exploit the highly-personal mobile medium, while respecting the rights of consumers and engaging with them in a way that consumers find appropriate.”
Arnav Ghosh, GM, Mobext, Havas Media, adds, “There are challenges in how mobile is being presented as part of a strategy to a client. I think 80% of the marketers who don’t use mobile or have used mobile very sporadically, need to be handheld on how it is going to work. Compared to 2011, 2012 has seen a lot more brands using mobile, but it has not yet reached the point where we can say that mobile is on its way.” As in any new medium, brands are testing and experimenting with the space, but marketers have not managed to keep pace with the exponential growth seen on the platform. Currently, the budget allotted to mobile advertising is about 7-8% of total digital ad spends; however, there is widespread optimism about the future.
“In 2012, mobile marketing and advertising must be roughly around Rs 180-200 crore and many analysts project growth of 4x or 5x in the next five years, that’s about Rs 800 crore by 2016. We being in the industry are optimistic and think it will reach over Rs 1,000 crore in the next four years,” says Girish Nair, CEO, netCore Solutions.
Madan Sanglikar, co-founder & CEO, ad2c, also shares similar sentiments: “We are expecting the Indian mobile advertising market to grow by 75-100% (YoY ). Mobile will grow at the cost of other mediums and also to some extent at the cost of digital spends, so a lot of display banner only campaigns will start moving from PC to mobile. Mobile will also grow by cannibalizing online display and brands will begin to question their traditional media expense.”
SURMOUNTING THE CHALLENGES
There are many challenges that the industry faces before it can ring in handsome growth, starting with lack of awareness. Phalgun Raju, Regional Director and General Manager, Southeast Asia, Hong Kong and Taiwan, InMobi, says, “The main challenge in a market like India is the education of both agencies and marketers , not only in terms of ‘why mobile’ but also ‘how mobile’? A lot of brand marketers are not aware of what all can be done with mobile advertising. Beyond SMS and basic standard banners, there is a whole new era around mobile rich media which allows ad units that help in brand recollection from an interaction perspective.” Raju adds that organizational structure and lack of communication between various marketing teams in different countries means brands not sharing their learnings across the board. Sanglikar elaborates that the many layers and options (content providers, aggregators, technology providers, distributors, ad networks) end up complicating the advertisers’ approach in the complex web.
CONNECTIVITY WOES
While mobile advertising scores over other mediums due to the high level of interactivity, powered by rich media ads, these require high speed Internet access. But bandwidth challenges, uncertainty over 4G and non-availability of hot spots (wi-fi) hampers connectivity to transmit video mobile advertisements.
Multiple challenges also exist in the minds of marketers as they struggle to integrate mobile advertising as part of their traditional marketing mix. Ghosh of Mobext, Havas Media adds, “Brands really struggle to leverage mobile because they don’t know how mobile is going to impact brand marketing. Because of its size, India has high mobile inventory but it is the classical 80:20 case where you have 20% of the brands vying for 80% of the mobile users.”
WHO’S DIALLING IN?
Telecom, handset manufacturers, BFSI, automobiles brands were among the early birds in this space and have now emerged as the biggest and strongest spenders on the mobile platform. For some verticals like financial, the entire platform of delivery is present on the mobile while opportunities are seen for travel, retail, fast food, sports and entertainment. Inmobi’s Raju says, “We are definitely seeing growth across all verticals but verticals that have been quickest to adopt this are seeing a huge growth in adoption. By default the biggest advertisers on mobile are telecom companies, and handset manufacturers.”
Dippak Khurana, Managing Director & CEO, Vserv.mobi explains, “Multiple brands and multiple campaigns have been done by BFSI and auto brands in this space because they fulfill a tangible need to the end consumer. Brands with high emotional quotient are typically slow to embrace a new medium; they are able to connect emotionally with consumers on TV but on mobile they are figuring out how to do it and do it well. However, clients’ willingness to experiment on this platform is very high.”
No surprises then that for auto brands like Volkswagen and Ford, mobile advertising is a priority. Lutz Kothe, Head of Marketing & PR, Volkswagen Passenger Cars says, “Volkswagen believes that the role of mobile advertising is as important, as the conventional mediums of advertising. It’s a platform that not only provides immediate access to product information but also serves as an universe of fun and entertainment for every car enthusiast of all ages. And, it is by far the fastest growing channel in the media mix.”
Sriram Padmanabhan, Vice President – Marketing at Ford Motor Company, says, “Our digital ad spends in 2012 were at 10-12%, up from 4-6% a couple of years ago. In the next two years, the mix of digital could potentially go up to 18-20%. Part of it is incremental, but part will replace our spend in traditional media. Within digital, mobile has moved from a minuscule 2-3% to almost 10-15% now in the last two to three years.” netCore Solutions’ Nair adds, “As people see more and more RoI in digital and mobile marketing, they are going to shift. No marketing manager will then not want to not spend on mobile marketing, because that’s where his consumer is going to be.” Kothe validates this point saying, “The mobile advertising space is less cluttered and the click- through rates are generally worthy. This medium is reasonably inexpensive as compared to that of traditional forms of advertising and delivers good ROI.”
WHERE TO ADVERTISE?
For advertisers testing the mobile platform, it appears complex with many variants and opportunities available and they struggle to decipher which would be the best option to reach their targeted consumer. But proponents of this platform argue that the mobile platform is all about relevance as it offers precision targeting because of the concept of SOLOMO, (social, local and mobility), the future of digital and this geo-localization with targeted promotional activity will drive mobile growth. No other medium can target customers based on these three parameters so effectively, giving the marketer the power to communicate their message to the right consumer at the right time and in the right context/location. In other words, the mobile could become the ideal marketing tool for any retail or fast food brand as they can target customers within a particular range and even incentivize them to visit their store by offering coupons on their mobiles.
Many marketers also seem to grapple with what type of platform to adopt for their campaign. But InMobi’s Raju says, “The main struggle is that marketers do not understand what they can do across various platforms because once they understand all the different options, it’s pretty easy to make a decision.” Standard banners and mobile display, specifically rich media, are highly effective to build brand awareness as this allows the brand to interact with users. Mobile rich media display banners that take up the full screen are highly interactive, allowing users to play games and have multiple action, providing an experience similar to that of a mobile application. Promotions and coupons also work as incentives on mobile rich platforms as users can download coupons and share with friends on the mobile rich media ad itself. There are also options for earned vs paid media within rich media apps. Though mobile technology allows creativity and innovation, a lot of ads on the platform are modified versions of print and TVCs. This will have to change if marketers are keen to use this technology effectively.
WHAT WORKS FOR BRANDS
Companies that have invested in this platform have now learnt what works for them. Automotive major Ford, which has a strong presence on the mobile space, for one targets its high-end niche clientele, most likely smart-phone users, using the mobile rich media space. Padmanabhan says, “SMS is out of the mix now. We use high engagement media and were the first to go with HTML5 app and layered applications, which is the next step for augmented reality. We got 10,000 + scans on the day we launched it and over 2,000 unique users across all parts of the country and what we delivered as an experience was a very engaging information about the product and we saw a lot of people clicking through to our communications.”
Kothe of Volkswagen Passenger cars elaborates, “Though all the forms of advertising demand equal preference, a lot depends on brand requirements as well. Some of our preferred forms are search & in-app advertising primarily because of performance & engagement reasons. When it comes to generating enquiries, banners and websites are highly effective.”
While smartphones have the upper edge in terms of delivering a rich experience by creating engagement on mobile display and mobile rich media, even low-end feature phones can be used to target consumers effectively, especially in rural markets. SMSes, voice and missed call alerts have been used to engage the consumer with the content or interact with a celebrity.
A successful example of this was the missed call alert campaign undertaken by Hindustan Unilever, for their detergent brand Wheel, in media dark areas. Nair says, “In this case radio and on ground activity was used to kick off the campaign but the rest ran on the mobile with 2.8 million people responding and pulling content for entertainment. The campaign was so successful that the brand did a survey post the campaign where 95% of the people contacted were able to associate the campaign with the brand and 80% were also able to associate the brand attributes to the campaign, there was about 36% increase in the usage of the product.”
MOBILE OFFERS BEST REACH
It is this sort of metrics that gives confidence that for anybody who wants to sell, the mobile is the device to be on to reach consumers. While promotional/commercial SMSes have gone down due to TRAI regulations, mobile marketing transaction SMSes have gone up as a means of keeping the customer engaged and informed. Nair says that with regulations while the quantity of SMSes have gone down, the ones that are sent are quite effective with many serious marketers adopting this as they have good RoIs even with high costs. However ad2c’s Sanglikar adds a note of caution: “SMS and missed call is a subset of mobile advertising but it needs to be supported by other parts, so a great SMS campaign not backed up by great delivery will never work out so the onus also lies on non mobile related aspects of marketing. That said, both do the job of getting connected to the consumer who can be targeted effectively for a lot of services. This TG may not go beyond missed call for next 4-5 years but from delivery perspective you have made it easier for him to connect with the brand.”
Dadwal adds, “We know that brands are not restricting themselves to individual channels. WAP/browser-based marketing campaigns have the advantage of being universally accessible, even to users with feature phones, and allow brands to reuse existing digital assets. SMS is also universal, shareable and includes a means of direct response. In-app ads can take advantage of trends like gamification as well as services like LBS and AR to provide rich media and enhanced user experiences. Each of these has its own strengths and will be used differently, according to the target audience.”
INTEGRATION IS KEY
The key word that emerges in mobile advertising is integration as most campaigns use a combination of different mediums, like SMS backed by voice, backed by missed call responses. Ghosh adds, “SMS inventory to display are the biggest drivers along with voice, in-app ads are also gaining momentum now. Display is the largest spend on mobile internet as it is easy to sell display with a larger online plan. So I think larger play is happening around display than SMS. With rich media, you can have larger piece of engagement on in-app, as well as on display on browser based inventory, so it’s a play between these three.” Ford’s Padmanabhan says, “Display banners are very focused and call to action driven so its is specific to a campaign. Search is a regular campaign as lot of people search for auto information on mobile than desktop so it is very relevant to be on search on mobile and that is the strategy we are following.”
With e-mail now being accessed on phones, e-mail marketing has now emerged as a tool for marketers and is seen growing by close to 100% (YoY). In fact, for early adapters, such as BFSI, e-commerce and travel, e-mail is the number one medium. Sanjeeb Chaudhuri, Regional Head, South Asia & Chief Marketing Officer, Consumer Banking, Standard Chartered Bank says, “In addition to ensuring maximum reach through traditional marketing channels like e-mailers and website communication, the bank also plans to reach out to the Internet and mobile-savvy audience by using digital search, display and in-app advertising. This will aid product awareness and increase downloads.” In-app ads are also seen growing at a rate of over 100%. Looking ahead, higher yields are expected from rich media.
APPS OR IN-APP ADS OR MOBILE SITES?
While marketers contemplate on what should be adopted when testing the mobile space, experts have differing views on it. Sanglikar says, “In a country like India where smart phone usage is not as big, it makes sense to start with mobile websites and based on the usage of mobile website, and the kind of analytics you get out of it, then you can make specific applications for specific works. If most people come on to the website on smartphone, that’s the time to create an app.” He adds that for some verticals like travel, financials and news, if you wait too long for an app to come, then you would have already lost to those who already have an app, making it a Catch 22 situation. However, Vserv.mobi’s Khurana believes, “Mobile apps are big as about 60% of mobile internet usage or browsing that happens, happens on apps. It is a much better experience than mobile web; so it is better to first start building an application than worry about a mobile website.”
While the jury may be divided on whether apps or mobile websites should be the first point of engagement, in-app ads have become the preferred form of advertising to target specific TGs. This works well for advertisers who don’t have apps as they can effectively target smart phone users effectively. Games, news, cricket, entertainment and social networking apps are preferred as they touch a lot of key demographics including women and youth. Kothe adds, “In order to engage our audience, we mostly target popular news websites like Times of India, NDTV in addition to sports websites, local search engines & classifieds.” Padmanabhan says, “We focus on sites which our consumers visit. News, sports and finance as a category has worked for us better. We have a long term relationship with Economic Times which helps us deliver better RoI on our mobile communication.”
CLICKS OR IMPRESSIONS?
While an impression is the first link that leads to clicks and then action, the market, however, does not value impressions due to too much of inventory. This has placed greater emphasis on clicks and the subsequent downloads which leads to a direct interaction between the brand and the consumer. In this scenario, traditional metrics like CPA, CPC, CPM, CPM are no longer relevant as CPD (Cost per Downloads) becomes more important and marketers start positioning their media buys around these metrics. Ford, on its part, focuses on click-throughs to the website for campaign-related banners and then at subsequent test-drive requests. In a study, Ford has also found that people who have been exposed to communication via mobile ads have a significantly higher favourable opinion about the brand versus those not exposed.
WILL 2013 BE THE ‘YEAR OF THE MOBILE’?
With mobile advertising poised to be the next mass media, it is the ideal platform for marketers looking at reaching out to the large digital base in the country. While the early movers making gains, many other advertisers are still testing the waters. The early adapters have managed to find their feet after testing and experimentation and this is something that the new entrants will also have to go through before the mobile revolution sets in.
Atul Hegde
CEO, Ignitee Digital Services
Digital as a market is still not mature. Mobile is a step after that, and its time will come. However, mobile will progress much faster than digital. Apps for large brands are mostly trying to expand their distribution into mobile, making it easy for people to buy on mobile. Once you have enough apps in the ecosystem relevant to the Indian audience, you will see marketers coming on to it.
Amit Bhartiya
GM & VP – Mobile & ViziSense, Komli Media
Marketers who are still not present on the mobile platform as brand managers have not been able to invest money as the brand still does not have a mobile website. If a user clicks on any banner, where do you go? The regular website is not meant to be opened on mobiles.
Phalgun Raju
Regional Director and General Manager, Southeast Asia, HongKong and Taiwan, InMobi
A lot of brand marketers are not aware of what all can be done with mobile advertising. Beyond SMS and basic standard banners, there is a whole new era around mobile rich media which allows ad units that help in brand recollection from an interaction perspective.”
Annie Mathew
Director, Alliances and Business Development, Research In Motion, India
In-app rewards are picking up in India. However, brands are contemplating on reach rather than monetization as their primary target is to expand reach and increase visibility.
Feedback: simran.sabherwal@exchange4media.com
