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4 disruptive technology trends impacting mobile advertising

Successful marketers understand that advertising must constantly evolve to reach targeted consumers at the right time on the right platform, and that brands cannot afford to rest on their laurels and risk being any less innovative.

Beyond traditional and digital advertising, mobile is now the lucrative brave new frontier for the advertisers. Gartner predicts that worldwide mobile advertising spending will balloon from an estimated USD 13.1 billion in 2013 to USD 18 billion in 2014, and forecasts that the figure will continue to grow to USD 41.9 billion by 2017.

This is especially relevant in Asia and in particular its emerging markets as consumers increasingly turn to their smartphones or tablets as the primary computing device and point of internet access. As mobile centric innovations impact user lifestyles, we will start to see the convergence of telecom, media and technology in a single ecosystem which will mark the way forward.

There are four disruptive technology trends that will reshape the future of mobile advertising.

#1 Tele”communicate”in
Emerging markets continue to dominate the business agendas of many companies, and for good reason: they are the key growth driver with access to the next billion Internet users. To reach out to these users, telcos will need to innovate on their business strategies and move away from their traditional and commoditised revenue generators – SMS and voice services. Telcos of the new mobile world have to find the right ingredients of low cost devices, synergistic partnerships and a granular mobile data strategy to create a winning recipe. From a devices standpoint, the sub$25 smart phones can be touted as the sweet spot in enabling this change, as validated by Mozilla’s showcase of its USD 25 range of phones. Facebook and Airtel’s partnership in Rwanda to offer subsidised data services is yet another example of disruptive partnership that the industry will need to adopt. The telecom ecosystem in emerging markets is therefore interlocking and cooperating with others to achieve business goals.

#2 Internet of things (IoT) innovation continues
IDC predicts that the installed base of the Internet of Things (IoT) will be approximately 212 billion connected devices globally by the end of 2020. While almost all industries are looking for that ‘intelligent’ system; from cars to fridges, manufacturers are attempting to differentiate themselves from the competition by offering as many ‘smart’ features as possible. These devices represent an untapped gold mine for advertisers. The ability to integrate people and the systems to interact with each other can offer unparalleled opportunities for brands and advertisers to redefine consumer engagement in a context-specific environment. Turning this concept into a practical reality will take a few years, but the foundation has been set. It’s a matter of time before the trend moves into top gear!

#3 The devices are back
Consumer preferences are constantly evolving and they have come to expect and demand impeccable performance and user experiences from their mobile devices. Device manufacturers are thus motivated to craft products that deliver on these expectations, going beyond just the user interfaces and designing both the software and the hardware of the phone to provide a holistic and integrated experience and have consumers develop emotional connections with their devices. For example, Samsung originally powered their wearable products with Android and then moved to Tizen, indicating a product-before-OS approach to their device design. Nokia also recently released an Android phone to win fans with product design. Similarly, Blackberry’s recent OS, the Blackberry 10, allowed consumers to install and run Android apps. The implication of such moves is that rather than let purchase decisions be dictated by choice of OS, manufacturers are now attempting to win consumers over through product differentiation instead.

#4 Weathering the over-the-top (OTT) appstorm
Telcos are challenged by the huge influx of OTT players such as WhatsApp, Viber and others that are making a serious dent in their SMS revenue. During MWC in 2014, the SingTel CEO said “investments in improving networks will be reduced unless they are given a right to charge OTT players for tapping their networks.” There are examples of companies that are turning this challenge into an opportunity with a joint ‘Telco-OTT strategy’, such as Orange’s “Libon” app. Created by Orange’s innovation subsidiary, Orange Vallée, Libon helps users manage their communications in a single interface, including free HD calls and messaging between users, low-cost off-net calling, visual voicemail and cloud storage. Libon is available ‘over-the-top’ (OTT) in more than 100 countries, but Orange is also promoting it via a collaborative model in which it offers the service to its mobile customers in partnership with its national operations. Such successes imply that telcos and OTT players cannot be on a path of collision but will need to work in tandem to align to today’s market realities.

Vikas Gulati

The author, Vikas Gulati, is the Vice President, Southeast Asia for Vserv.mobi