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What’s working in mobile advertising — and what might work in the future

Even as usage of mobile devices explodes, spending on mobile ads still lags spending on online ads by a huge margin. Will that gap narrow anytime soon? Here’s a look at some of the strategies that mobile marketers are using.

mobile advertising, Millennial Media

As Mary Meeker, the Queen of the Internet, made clear earlier this year, mobile is on the wrong side of a monetization gap. While consumers are spending more and more time on mobile devices, advertising revenue there is still lagging well behind traditional online — some $30 billion was spent in online advertising last year in the U.S. vs. $1.6 billion for mobile ads. Ad rates on mobile are 5 times lower than on desktop.

Mobile AdvertisingAdvertisers are expected to chase the eyeballs to mobile, though to what extent and how quickly is unclear. Mobile presents particular challenges for advertisers because they don’t have the same retargeting tools (like cookies) that they have online, the screens are smaller, and ads have the potential to be more intrusive than on the desktop. For now, marketers are spending more on ads for smartphones than for tablets, because more people own the former than the latter. But some of the metrics suggest that tablets may have better monetization potential. Click-through rates for the iPad, for example, are twice that of the iPhone, according to Inneractive, a mobile ad exchange, and thus the ad rates are also higher for the iPad.

Whether mobile ads ever catch up to online advertising in revenue will have huge ramifiations for big companies like Facebook, Twitter and Pandora whose audiences are rapidly shifting to mobile devices. Currently, the sectors that spend the most on mobile advertising are telecommunications, retail and restaurants, automotive, finance and education, according to Millennial Media. Many brands, however, are still just experimenting with mobile and are spending a very small percentage of their ad budget there.

Here’s a look at the main categories of mobile advertising, as well as some emerging strategies that publishers and developers are banking on to help close the monetization gap.

Search advertising

emarketer, mobile advertisingStill the big dog in mobile advertising, bringing in about half of all mobile ad spending. That is likely to continue as consumers turn to their smartphones as a research tool while on the go. As Google pointed out, the smartphone is often the first step in a longer research process that continues on a tablet or computer. Mobile search is also valuable for advertisers because most consumers are very intent-driven when they search on a mobile phone and are likely to complete a task after searching.

Google said that 9 out of 10 mobile searches by users have resulted in an action such as a purchase or a visit to a business. While Google, which pretty much owns this category, can obviously benefit from growing mobile search, local search engines like AroundMe and location-based services like Foursquare may also see a lift. The rise of mobile apps may also threaten Google as more consumers get their mobile queries answered through a dedicated application.

  • Amount forecast to be spent in the U.S. in 2012: $1.28 billion*
  • Companies with the most revenue: Google (95 percent of the market).

Rich media and video ads

Medialets, rich media mobile advertisingThese offer advertisers an often pricey way to take over a screen and give consumers what can be a more immersive experience. Advertisers can use video, animation, photo galleries and interactive elements, which can make mobile advertising more akin to a TV commercial or a slick magazine. Opera Software, the mobile browser company,reported in July that users who clicked on a rich media ad spent an average of 52 seconds viewing a video and 1 min and 25 seconds interacting with photos. Opera noted that advertisers have started using rich media and video ads more frequently this year than traditional banner ads.

  • Amount forecast to be spent in the U.S. in 2012: $647.1 million*
  • Companies with the most revenue: Apple iAd, Medialets, Crisp, Celtra

Banner display ads

Mobile advertisingSome of the most popular ad units in mobile are banner display adds, but in terms of ad spending, they were eclipsed by search ads last year. Display ads are still very prominent, in part because advertisers can buy in standard formats, like they’re used to doing online. But the units are problematic on small screens because they cantrigger more accidental clicks.

And if advertisers keep the banners small to avoid turning off users, then they can run into another problem — namely that they’re harder to make engaging and thus easier for readers to ignore. A traditional online banner ad may fetch $3 to $5 for every thousand impressions, which is still a lot more than mobile banner ads, which receive $1 or less on a smartphone, the New York Times reported. Banner ads won’t fade overnight but they are losing favor with advertisers. Opera Software said that static and expandable banners went from 66 percent of ads in January of this year to 36 percent in June.

  • Amount forecast to be spent in the U.S. in 2012: $457.5 million*
  • Companies with the most revenue: Pandora, Google, Twitter, Millennial Media, Apple and Facebook

Those are the major mobile ad types that are growing. Below, are some other formats where the spending is smaller but that publishers and developers have high hopes for.

Location-based advertising

Location-based mobile advertisingOne of the most promising parts of mobile advertising because it leverages the mobility of smartphones and tablets. But the early efforts have been slower to take off, in part because ads delivered via geo-fencing or proximity don’t necessarily catch people at a time when they want to act or don’t factor in a person’s preferences. Providers like Sense, JiWire and WHERE are getting smarter about mixing location data with behavioral profiles to deliver more relevant ads to people.

Companies like Waze, a crowd-sourced navigation app, and Roximity, which hooks into in-car entertainment systems, are showing how drivers can also be targeted with location-based ads in their car. There is a danger in being too pushy with location-based ads, and creeping out users who don’t know their location is being tracked. BIA/Kelsey forecast that U.S. mobile local ads, based on a user’s location, will grow from $664 million in 2011 to $5.8 billion in 2016.

  • Early leaders: JiWire, WHERE, Sense Networks

Native advertising

Facebook, mobile adsThe latest rage for companies like Facebook, Twitter and Tumblr. Unlike with standard ad units, publishers help advertisers create messages and content that work within the flow of their platforms. By using the existing units of content, like a tweet or update, advertisers have an organic way to advertise through mobile that is harder to ignore.

Facebook said it now gets 14 percent of all of its revenue via mobile sponsored stories and install ads, which appear right in the news steam of its mobile apps and website. EMarketer estimated thatTwitter would make $129.7 million in mobile advertising this year, more than Facebook. The challenge with native advertising is that it can be hard to replicate across different publications and often requires more work to cater to each platform.

  • Early leaders: Facebook, Twitter, Tumblr

Other

There are some other approaches that show that it’s not just about placing a basic ad somewhere in an app or website. Kiip (see disclosure below) rewards people after achievements and milestones during games and apps. Pontiflex lets people sign up to receive ads and offers from brands they select. Appssavvy allows advertisers to place ads alongside activities inside apps and websites. Tapjoy helps people earn in-app rewards for watching videos, installing apps or subscribing to services. Conduit is creating lock-screens for Android devices that can be branded and potentially carry advertising.

*figures from eMarketer

Disclosure: True Ventures is an investor in Kiip and the parent company of this blog, Giga Omni Media. Om Malik, founder of Giga Omni Media, is also a venture partner at True.

Building the Case for a Mobile Marketing Strategy

Working with mobile

No matter what business or industry you’re in, when you hear predictions like Microsoft Tag’s stating that by 2014 mobile Internet should take over desktop internet usage, it’s clear that mobile is significantly changing the online landscape for everyone – B2B and B2C companies alike. 

 Even if you are excited and ready to start forming a mobile strategy, odds are that you’ll still need to prove the point to someone else in your company that mobile does indeed need to be part of your 2013 strategy.

We’ve compiled some convincing facts and stats that will help you get the rest of your team on board and make mobile a part of your 2013 plans:

Mobile Internet usage has reached a tipping point:

A majority of American adults with cell phones are now using them to go online, and within that group, 31 percent use their phones for the majority of their Internet use. (Source: Pew Internet & American Life Project)

Your target audience likely uses mobile Internet:

Age groups with high levels of cell phone Internet usage include adults 18-24 (75% of cell owners in this age group use their phones to go online) and ages 35-44 (68% of cell owners in this age group use their phones to go online). (Source: Pew Internet & American Life Project)

Mobile traffic is growing significantly:

Mobile phones and tablets now account for 1 in 8 Internet page views in the U.S. (Source: ComScore)

Mobile search is growing too:

One in seven searches happens on a mobile phone. (Source: Google)

Mobile users expect high-functioning mobile optimized web experiences:

Mobile users do not have much patience for retrying a website or application that is not functioning initially — a third will go to a competitor’s site instead. The majority of mobile web users are only willing to retry a website (78%) or application (80%) two times or less if it does not work initially. (Source: Gomez)

While these stats will help frame the growing importance of mobile, it also helps to pull some of your own stats. There are two simple ways to show that this trend applies to your brand too:

  1. In Google Analytics or your preferred site analytics platform compare mobile traffic to your site from Q3 in 2010, 2011 and 2012. We bet that whether you are B2B or B2C, you’ll be surprised by the change.
  2. Take a look at the number of leads, customers and prospects who have viewed your recent emails on a mobile browser compared to two years ago. Again, the numbers here will be telling.

And if at any point someone in the group you’re trying to convince of the importance of mobile starts to look at their phone, you can stop stop, take a picture and end your argument there. It’s a simple illustration, but it proves your point: mobile matters now, it’s here to stay and it needs to be part of your business and marketing plans.

Seven ways to keep the mobile search experience fresh

And with each upgraded device that comes out, the design geniuses at Apple, Microsoft, and others have added cool new features and enhanced graphics to improve usability.

With the never-ending array of changes, updates and improvements, e-commerce marketers are under great pressure to make sure their mobile websites not only overcome the challenges of browsing on small devices but that they also take advantage of all the capabilities available.

Site search is typically the key way mobile users look for products and content, and because site search users typically convert at a higher rate, it’s important to constantly update and enhance mobile site search to maximize performance.

Here are some insights into how to make mobile sites more search-friendly, taken from our “Big Book of Site Search Tips:

Put the spotlight on the search box

The search box should be easy to find on any regular website, but an easy-to-find search box is even more crucial on a mobile site. Display it prominently at the top of the mobile webpage – in fact, it should be one of the most obvious features on the page. Boden highlights the search box on its mobile home page.

Auto complete saves time

When you save mobile shoppers time and clicks, you help them get to products faster (and minimize errors). Auto Complete is a great feature because it suggests terms when visitors start typing the first letters of a keyword, and helps your mobile customers find what they want with less typing.

You can show the possible terms in a drop-down menu to save space on the mobile screen, and ranking the terms by the most popular keywords can further increase clickthroughs.

You should also consider bumping up the usability of this feature with Rich Auto Complete, which displays the name, image, description and price for the most relevant products within search results – although keep in mind that this may slow down performance to load the accompanying pictures.

Make refinements expandable

Refinements are a must for mobile users as they make it easier to narrow down results. On a standard website there’s a lot more room to play with – you can put refinements on the left-hand side of the screen or at the top.

On a mobile screen, however, it makes more sense to show expanding lists of refinements to save space. These can be displayed with JavaScript, so they expand immediately when the user clicks on them.

SockShop does this with arrows that display available refinements as shoppers click on each choice.

Take a cue from Facebook

Add infinite scrolling: Infinite scrolling of search results is another way to reduce typing and keystrokes, because when visitors get near the end of the page, more results are loaded automatically, creating an endless scroll.

Localise site search results

Your customers love to seeing localised information that can be provided based on a device’s GPS tracking. You can do this with search results, either through the GPS information or by allowing shoppers to enter their address or postal code as they search so they only see results that are relevant to their location.

This feature can drive mobile shoppers to your physical stores where they can see, touch and experience products up close. You can take it a step further by including merchandising banners on search results pages to highlight promotions or special offers in the visitor’s specific region.

Point QR codes to search results

Mobile shoppers like to use QR codes to take advantage of promotional offers and get more information about products. QR codes that point to mobile search landing pages can help you increase engagement with customers and promote specific brands.

Such codes can also help jump-start the search process and encourage mobile users to dig deeper into your product catalogue.

Use keyword-specific banners to drive more interest

When mobile customers search for a brand name or product that is on sale, or if you have new arrivals you want to showcase, include a keyword-driven banner at the top of the search results page to highlight that promotion – and drive more clicks.

Above all else, you need to keep testing mobile search options and monitoring mobile visitor behavior so that you know what’s working and not working on your mobile site. Change is a constant in the m-commerce world, so you need move fast to keep things fresh and engage with your on-the-go fans.

Five Things Marketers Should Know About Apple Passbook

Unless you’ve been hiding under a rock during the last couple months, you know that Appleannounced the new iPhone 5 back on September 12, 2012. On this date, Apple also rolled out its latest mobile operating system, iOS 6, which came chock full of new features like enhanced Siri, new 3D maps and deeper integration with social networks Twitter and Facebook.

Arguably, the most important new feature to arrive on iOS 6 was something calledPassbook, which allows marketers to provide coupons, tickets, loyalty cards and more, all in one place on the iPhone or iPad.

For anyone that is interested in a deeper dive, thePassbook Developer kit is a great resource. Assuming that the rest of you are like me and just want the Readers Digest version for marketers, here is the good stuff:

1) The real power behind Passbook, and the most important reason any marketer should consider it, is that for iPhone and iPad users who have upgraded to iOS 6, it is the killer location-based app.

What I mean by that is that if you can encourage a customer to accept a coupon, ticket, loyalty card or pass from you a single time, you have ongoing permission to communicate with them/provide value as long as they have that item in their Passbook.

2) Because Passbook comes pre-loaded on iOS 6 (on the homescreen, to boot), it is impossible not to see. It’s also impossible to delete the app.

And while you can delete items from your Passbook, the user has to flip the item over and then find the delete button in the top left corner. It’s one of the few times that a non-intuitive user interface is helpful to the marketer.

3) While the Passbook functionality integrates nicely with mobile apps, thanks to an easy-to-use API (download the American Airlines, Target or Eventbrite apps for examples), the benefit here is that you can also deliver passes via e-mail or the Web, ensuring that almost anybody can use Passbook.

Speaking of anybody using Passbook, there are several sites that allow one to build their own Passbook functionality — DIY sites like Passdock, and Tello’s PassTools.

4) As mentioned in bullet one, tapping into the location-aware capabilities of Passbook is one of the more powerful aspects of the app. This allows marketers to message customers when they are in store or near a particular location.

Unlike foursquare and other location-based services (LBS), the customer only needs to activate an item once in Passbook to allow for ongoing messaging. Passbook is also date-aware, so it can be triggered on holidays/certain days of the week, as appropriate.

5) And finally, an ability to customize the items within Passbook to include messaging, barcodes, QR codes and other scannable formats allows for the proper connectivity of Passbook with most point of sale (POS) systems.

While Apple Passbook is good now, I can only imagine that it will get better in time. Over the next few months, I will keep readers of Marketing Land updated on the latest and greatest functionality.

Have you seen any great uses of Passbook? If so, please include links in the comments.

Opinions expressed in the article are those of the guest author and not necessarily Marketing Land.

Mobile Marketing & Measurement Snapshot: Google & ClickZ Insights

Mobile has become an integrated part of the marketing mix and is no longer an add-on to campaigns. In fact, it’s the central focus for a growing number of marketers, 87 percent of whom are planning to increase their emphasis on mobile in 2013.

Google Analytics are making mobile measurement their focus going into the next year, says Product Marketing Manager Adam Singer. His team has just released the results of a recent research project on the mobile marketing opportunity by Google Analytics and ClickZ.

Their joint research is being dissected on-stage at SES Chicago, as Singer sits on a panel alongside Search Engine Watch Director Jonathan Allen and comScore’s Director of Mobile, Diran Hafiz. Melanie White, Special Projects Editor from ClickZ, is moderating the session.

“We know marketers want simple tools that help them seamlessly integrate mobile into their marketing and measurement, and that’s our focus,” Singer wrote in the blog post summarizing their findings.

Marketers are interested in mobile measurement across the lifespan of an app, Google found. They examined the mobile app metrics marketers indicated they are most interested in:

mobile-metrics-research

Most of these metrics are available within the Google Analytics Mobile App, released in June, Singer noted.

Over the next year, marketers plan to use a mix of mobile tactics, the study found: 52 percent plan to create a mobile- or tablet-optimized website 48 percent plan to increase engagement in mobile advertising 41 percent hope to develop a mobile app 39 percent are planning to market a mobile app

Despite the growing interest in mobile, many marketers struggle to capitalize on the opportunity; 59 percent of those surveyed consider themselves either novice or inexperienced in measuring mobile. Organizations that invest in training and education today have an opportunity to come out ahead of the curve tomorrow, said Singer.

Google and ClickZ found that: 58 percent of marketers are currently accountable for mobile metrics, and more than one-third are already sharing internal dashboards to show mobile marketing results. 53 percent of marketers who analyzed their mobile metrics say there is a lot of untapped opportunity and plan to increase their mobile spending. Tools, technologies and talent are in demand: 68 percent of marketers plan to increase technology and ad investments, 32 percent in talent.

“Mobile’s role in marketing is becoming a central part of integrated campaigns and will only continue to grow. Effective measurement across mobile sites, ads and apps will help marketers create winning strategies,” Singer wrote.

These latest insights from Google Analytics come on the heels of their late October Universal Analytics announcement, in which Group Product Manager Manav Mishra explained enhanced new analytics capabilities for enterprise-level Premium or API clients. Universal Analytics tools are made possible by Google’s new Measurement Protocol API and are currently in beta.

Stay tuned to SearchEngineWatch.com and find us on Facebook or Twitter for the latest news from SES Chicago.

Travel Apps

<iframe src=»//www.slideshare.net/slideshow/embed_code/3819254″ width=»427″ height=»356″ frameborder=»0″ marginwidth=»0″ marginheight=»0″ scrolling=»no» allowfullscreen> </iframe> <div> <strong> <a href=»https://www.slideshare.net/Stutts/fifty-mobile-travel-apps-you-should-know» title=»Fifty Mobile Travel Apps You Should Know» target=»_blank»>Fifty Mobile Travel Apps You Should Know</a> </strong> from <strong><a href=»http://www.slideshare.net/Stutts» target=»_blank»>David Stutts</a></strong> </div>