The total spend on mobile advertising increased from USD 2.3 billion in 2010 to 25 billion in 2014 (Statista 2015) – that’s approximately a 246 per cent year on year growth. This should be a ground-breaking statistics for any other industry, but not for mobile advertising. According to Inmobi and eMarketer, mobile devices represent 37 per cent of the total media consumption, but only 7.1 per cent of the media spends and this time the blame is not on the brands.
What is the reason for this disparity? The misunderstanding lies between the traditional advertising approach and the nature of the mobile experience.
Over the years, the entire advertising industry has evolved around adapting the most traditional ad format i.e. billboards and progressively making it smaller – from billboards on the most important city squares to newspapers, magazines, desktops and now finally mobile. At every stage of the adaptation there have been innovative ways of serving these billboard ads, which have debatably worked for the medium.
However, when it came to mobile, it became that really tiny and annoying billboard sitting at the bottom of the screen of most apps. It doesn’t matter if it geo-locates your phone and strategically serves the ad on your mobile screen or how well it reflects your personal preferences. Even if it could read your mind, it wouldn’t change the fact that it’s still just a tiny annoying billboard. Mobile advertising has since then progressed in different sizes of banner ads, rich media executions and mobile video ads, but again all these ad formats are adaptations of the larger traditional formats into a smaller screen.
There is a rush in the ad tech startups these days that are focussed on how to target mobile users in the most efficient way. Some of them have devised very advanced targeting capabilities, which help you reach your mobile user anytime. But then again, I believe that targeting is a secondary problem. The first problem is the communication, the messaging. Most advanced targeting which serves banners ads is still not going to solve the puzzle.
In my experience with brands, I always try to tell them that advertising on mobile is not about the mechanics – banner ads, rich media interstitials or the 30 second spot. Rather where mobile really takes the leap forward is the connection that a mobile device can create between the brand and the consumer.
Brands, advertisers and publishers have to consciously work towards creating a better connection. While brands must realise that mobile as a medium provides the most unique opportunity of creating a personalised experience for a user, a non-pleasant mobile experience can also lead to a very negative brand image. As long as the connection is crafted and personalised, the advertising dollars will definitely start flowing in.
As a publisher, Facebook has been the most successful in creating a wholesome mobile ad experience for their consumers. Validation for it is that 66 per cent of its total ad revenue last quarter came from mobile. The key is that they have realised the mobile opportunity and consciously recycled their ad model for the smaller screen.
Another company that has been successful is a mobile reward network called Kiip which is innovatively changing the mobile advertising landscape, creating seamless in-app rewarding experiences for users.
We need a number of such breakaway concepts to jump into the next level of advertising budgets. Alternately we can continue spamming mobile users with billboards until we find the next smaller screen, probably the Apple Watch.