Numbers Forecast Booming Mobile Ad Future

Mobile advertising had its palm read on Monday, and this was its future: Abundance.

The message at the Borrell Associates Local Mobile Advertising Conference in Chicago was a simple matter of proliferation: Ubiquitous mobile users pair up with growing local advertising dollars spent, close to 20% of that headed online. Media analyst Gordon Borrell projected that by 2015 up to two-thirds of local advertising will be served up on mobile.

Gordon Borrell, Borrell Assoc.

“I would say that mobile advertising is pulling into the station right now and is going to take off really quickly,” Borrell said.

For many media companies, jumping on that train has been a nerve-wracking experience, particularly since the destination isn’t entirely clear. But presenters at the conference made a compelling case for buying the ticket and taking the ride, offering insights into consumer behaviors and overall ubiquity, tips on how to bring reluctant sales reps aboard and sharing a glimpse at early successes in monetizing mobile.

For Chuck Martin, author of The Third Screen: Marketing to Your Customers in a World Gone Mobile, it’s a no brainer: almost everyone has a mobile device. He pointed to a number of statistics that would seem to bear him out: 77% of the world’s population now has cell phones. In 97 countries, that penetration exceeds 100% of the population. There are 26% of U.S. households using a cell phone only. And 38% of mobile phones are now smartphones, a number expected to jump to 50% next year.

Chuck Martin, author

More than being a technological revolution, Martin said the mobile explosion marks more of a behavioral revolution, one in which mobile usage has already become deeply ingrained in consumer behavior. “This is the first time the revolution is being led by the consumer and the companies are behind,” he said.

Michael Becker, managing director of the North America Mobile Marketing Association, said that more people will access the Internet via mobile than broadband by 2015 and that much of that traffic will be going local. He noted that one in three Google searches have local intent and that there are prime opportunities to market on mobile to the action-ready consumer, 36% of which will take action immediately when using mobile, another 39% within a few hours and 14% within a day.

“The goal is to be at the point of consumer expressed need,” Becker said.

Joy Liuzzo, senior director of Insight Express, brought mobile consumer behavior into even sharper focus, noting that smartphone and tablet users will spend an average $300 more on their holiday shopping this year over their peers. But they’re also likelier to shop over the Internet, so she stressed that many need an additional layer of incentive. “If you’re going to get them in the store, you need to give them that call to action,” she said.

But mobile users are also more apt to be purchase-motivated, she said, noting that on average mobile moves purchase intent by 11 percentage points (television comparatively clocks in at 5.6). “Mobile is more effective in moving purchase intent than television, online and print,” she said.

Liuzzo also pointed to some cliché-busting trends in mobile usage along gender lines. One was that men tend to use their phones more than women in grocery stores. They’re also more apt to use their mobile phones for coupons.

But some clichés persist: Liuzzo said that men are also more likely to use their mobile phones for product information than to ask a salesperson. In fact, more and more consumers are reaching to their mobile devices rather than salespeople for product information, she said.

When it comes to using mobile for consumer activity, the shoppers are already there, Liuzzo said. “Consumers are already doing it, so we just have to ride the coattails of this behavior,” she said.

And they’re not the only ones primed for a mobile ad boom. Borrell cited a study that 48% of 1,000 local businesses said that they would use some kind of mobile advertising in the next year.

So why hasn’t the mobile ad revolution gone from simmer to boil yet? One reason might be that some of its most reluctant conscripts have been those who would sell it. Legacy media reps chafe at mobile ads’ lower margins and the prospect of leaving their selling comfort zones, a problem for which Terry Delisa, vice president of digital for Tribune Interactive, proffered some solutions.

“If they just sell mobile siloed then it’s not going to get the reaction,” Delisa said, adding that integrating a mobile component into other media ads is integral.

It’s also about volume, she added, likening mobile to the early days of building classified ads.

Left to right: Terry Delisa (Tribune) and Sandy Martin (Schurz)

And mobile baptisms don’t necessarily need to happen en masse. Sandy Martin, mobile director at Schurz Communications, said it can begin with a single rep. “We will start with one mobile evangelist per market and hope that everyone catches the fever,” she said.