On 9/26 Monday and 9/27 Tuesday, GigaOM held its Mobilize conference in San Francisco. Over the next couple of posts, I will talk about the trends that were discussed during the conference.
Unless you live under a rock, it’s hard to ignore that mobile advertising is exploding. According to Smaato, mobile advertising is a $11.4-$20B market in 2011 alone. At Mobilize, AT&T Interactive, Kiip, Pontiflex, and Appsfire grabbed the stage to talk about this hot topic.
The current landscape of mobile advertising is still evolving. One panelist said it took about a year ago for ad networks to target ads based on location, previously it was just based on clicks. Imagine the days before Groupon and LivingSocial. Pontiflex and Kiip say about 48-60% of mobile ads are clicked on accident. Some app developers are gaming the system by putting ads right next to frequently pressed buttons (e.g., pause button). This implies about 50% of your mobile ad budget is wasted. A big challenge is that the definition of engagement has a wider range of possibilities than web advertising. Is engagement a call to the store? Entering the store (offline/online)? Measure on size of (offline/online) purchase? Use of a coupon? If Google Wallet catches on, Google will be able to track ads all the way down to the point of purchase in a brick and mortar store.
One company Kiip focuses on achievements as a cost of engagement. For example, when a player completes a level, they will show a mobile ad at that very moment. For a BestBuy campaign (assuming because it was described as a yellow large electronics retailer), Kiip got a 15% conversion. They believe that people will want to “engage” when they are in a happy moment. In fact, they are working with experts in cognitive and happiness to improve their service. Appsfire is at the promotion level. AT&T Interactive is doing search advertising.
Mobile advertising can be helpful and it’s not all bad and intrusive. An example coming from web advertising, when Google took off its ads off of the websites, people complained because the ads were useful. Pontiflex says when it comes to mobile advertising, there are three major groups involved in order to make mobile advertising a success – ad networks, app developers, and users. You can’t ignore any of these groups. Appsfire says you have to trust app developers to know where to place the ad and give them flexibility. Most importantly, you have to let users figure out how they want to engage with you. For example, 1 in 5 do not want mobile coupons.
Tips for app developers, you need critical mass with make money with ads. If you have local mass, it’s even better because a lot of mobile ads are local. It helps to have your app translated to other languages too.