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Mobile Advertising - How The BIg Social Networks Are Adapting

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Mobile advertising is experiencing an odd growth rate at the moment. While smartphone penetration continues to rise worldwide, and even across lower-spending markets, the rate at which companies are picking up on this isn't quite matching. Looking at recent figures, consumer interest in mobile is far outweighing the spend made by brands in advertising:

So why the disparity? First, it is still an incredibly new medium. We don't quite yet know how consumers will react to advertising via mobile, or how much time we can reasonably expect them to spend with an ad. Secondly, it is a much less open market than say, social media advertising, where many sites now have open ad platforms allowing brands to set up and manage their own campaigns.

While Facebook is making some movement in this, for example by allowing brands to target ads to mobile users, this is currently only available within Power Editor, which is not something immediately open for all advertisers, but rather conserved for those with larger budgets.

And just as we saw with social network marketing or advertising, mobile is currently at the stage where it is still very much an afterthought. A case of ticking the box to allow your ads to show on mobile, without really thinking about what type of ad will work, which format it should be in, and what the overall strategy for a mobile ad campaign should be. This is understandable, given how new the concept is.

[caption id="attachment_64686" align="aligncenter" width="627"]

Image via The Alantic[/caption]

However, some brands are making real inroads with smart mobile ad campaigns that are sympathetic of the medium they're operating in. We've shared some of the best ones below, along with some compelling stats to show why mobile advertising deserves its place on your marketing campaign.

Contents

1) Types of Mobile Advertising

2) Social Media & Mobile Advertising

3) Mobile Campaigns

4) Future Trends

5) Infographic Sources

Types of Mobile Advertising

Banner Ads

The most common example of mobile advertising out there, if you're a smartphone user, the chances that you have already seen this type of ad is quite high, While they served a purpose on desktop, banner ads are starting to fall out of favour with advertisers as users begin to ignore them and marketers are looking at different ways to engage users. While they mostly feature on free apps, most of these apps have a paid version which gets rid of these ads. The cheap nature of banner ads means that they won't be disappearing any time soon, but as smartphone users start expecting more, marketing strategies will have to change to reflect this.

Augmented Reality

Definitely the area that will see a lot of growth over the next few years, Augmented Reality (AR) is where computer-generated graphics or animations are added on top of a view of your real-world environment. The rise of companies such as Blippar is paving the way for how AR is used to market and promote brands and products.

While AR is the most expensive advertising format here, the potential and the opportunities provided are massive. Its functions could range from providing additional information about goods or services, or superimposing items in your home to see how they would fit in. Its use is growing and the fact that it has yet to hit mainstream use means that its going to become more popular as usage grows.

Apps

Quickly becoming a very crowded market, apps have become the lifeblood of smartphones with a platform's success or failure depending upon it. It's no longer enough to just release an app and expect it to perform well, to get people to download it, you need to produce something special.

Also, while people are spending more and more time on apps - sometimes more than they would spend surfing the Web - the majority of this time is spent on gaming apps, which would take up more time.

Currently, having an app is the same thing as having a Facebook or Twitter page, so if you decide to release one, you need to make sure the quality is and have a decent marketing campaign behind it so that people will download it.

NFC

Near Field Communications (NFC) is another emerging area in mobile marketing. The best way to understand it is that it functions like a 'mobile wallet' and a large number of smartphones come with this technology pre-installed.

Its most popular use is paying for goods by simply taking out your phone and tapping/swiping it at the checkout, for contactless payment. Services like Google Wallet are leading the charge with numerous other competitors releasing their own versions over the coming months.

QR Codes

Although they've gotten a bad rep as of late, quick response (QR) codes are a great way of providing content to smartphone users in a direct manner. Basically, QR codes work in the same way as bar codes, except these can be scanned on your smartphone through a specialised app. The QR code acts as a visual URL which takes the use to a particular address when they scan it.

While the majority tend to direct people towards a webpage, those with a little more imagination would use it to provide special offers or link to different videos which show off their new products. Also, other apps like Kuapay generate QR codes which you use to pay for goods, so there are other uses for it beyond linking to different URLs.

There is a large number of QR code generators out there, but remember that for most generators, you're not able to change the URL once you create one.

Tagging

Working on the same principal as QR codes, tagging is slowly becoming more popular with marketers as it provides a more seamless process. Instead of scanning a code or typing in a URL, tagging apps like Kooaba work by holding your smartphone's camera over an icon, like in a newspaper or magazine, and you'll be automatically directed to whatever content is linked.

Social Media & Mobile Advertising

The problem that all of the social networks face at the moment is that an increasing amount of their users are using their services on mobile devices rather than on the desktop where it is easier to show more ads. This is one of the main reasons why Facebook's share price has been struggling whereas Twitter, which is more of a mobile play, seems to be having great early success with its mobile ads. Here are some of the formats that are being used by the big guys.

Facebook

Facebook's problem is complicated. Its mobile sites and apps are starting to see huge amount of usage, but they simply can't serve as many ads on small screens as they can on larger devices. Last week's overhaul of the Facebook app does mean that more sponsored stories are starting to appear in the newsfeed and the design is done in such a way that you would hardly know they are even ads.

There is also no doubt that Facebook's next revenue stream will involve pushing app distribution through its new app store. They are promoting it heavily through the log in screen on the desktop and they have 150 million people using it already. If you think about it, people are most likely to download apps when on their phone so Facebook will no doubt be offering developers and publishers a way of securing downloads through ads in the newsfeed.

Mobile app developers have the chance to run their ads on prime real estate on devices and given that six of the top ten apps in the iOS app store use Facebook login, you can see the huge potential here.

You can read the entire guide on how the ads work here. The beauty of these ads is that given how much information Facebook has about its users, apps developers can target their ads based on demographics and user interests. This is still very much in a test phase, but these ads will continue to grow and become the default way to distribute apps soon.

Twitter

Twitter has a huge advantage over other social networks because most people primarily use the service on their phone or on tablet devices. It will also make a lot of money on the desktop, but it doesn't have the same challenges that Facebook has in terms of moving their revenues over to mobile. Over the past year, it has been busy shutting down their API to other developers because it knows that it needs to control everything in their ecosystem in order to increase revenue from ads. Word on the street is that Twitter ads are massively engaging and are seeing massive click through rates. The first type of ads are pretty harmless because they just allow you to pay to be suggested users.

Where it starts to get a little more interesting is when Twitter puts in sponsored tweets into the main feed. These are still being tested on a very small level as it essentially changes the entire Twitter experience and puts paid content into your feed. That is a big step and one that Twitter is taking slowly. One or two ads a day are fine, but what happens when they open it up to a much bigger and wider market with a self-service option? Chaos?

You can also target ads at people based on the mobile device they are accessing Twitter via and that makes for some interesting marketing options especially when it comes to app downloads.

Foursquare

Considering the data Foursquare has at its disposal, it was inevitable that it would introduce its own ads. Similar to Facebook, these ads are coming in the form of "promoted updates," messages that are presented to users who are within the vicinity of a business, store or restaurant. These updates will be found in the 'explore' tab and are tailored towards the likes and interests of each user. Currently, the new format is being tested with a small number of companies, but when it's released for general use, businesses and brands will pay Foursquare on a 'cost per action' model.

The other method Foursquare uses to advertise goods is 'local updates,' which is free and only appears to those users who have either 'liked' a venue or have checked-in a number of times. This is more to reward loyal customers and only appear when somebody checks-in to a business or looks at the app's 'Friends' tab.

Mobile Campaigns

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Image via Mobile Marketer[/caption]

KFC

Earlier this year, KFC utilised a variety of mobile apps and channels to promote its chunky chicken pot pie. The campaign had a 1970s funk flavour to it and a Pandora radio station dedicated to only the grooviest hits was created to entice customers. QR codes were also displayed on the side of KFC cups; they led customers on to additional content and gave them the opportunity to enter a sweepstakes giveaway.This campaign had a winning humour at its centre that's easy-going and helpful when engaging with potential customers. It was multi-faceted and takes advantage of many platforms so as not to be one-dimensional or easily discarded.

Uber

This amazing campaign for limousine rental app Uber ingeniously incorporated a great product, with mobile savvy and, of course, ice-cream. Instead of using the app to arrange a limousine pickup, users in seven North American cities used the app to call an ice-cream truck to a location of their choosing and were encouraged to use the #OMGUBERICECREAM hashtag. A really novel way to advertise a great if impractical app that spread like wildfire because of how unique it was. It stands out because it offered something different and fun, while requiring very little from excited users.

Universal Pictures

Universal Pictures and the movie industry have been keen to use mobile advertising to hit key demographics. Famously, cinemas are populated with mobiles and social media-inclined teenagers who would be susceptible to such advertising. Universal were more than happy to promote the Kristen Stewart-starring Snow White & the Huntsmanthrough mobile devices and across a number of social media platforms, incorporating Facebook, Twitter and Pinterest into their marketing strategy.

Quite simply, upon tapping the ad, interested users would be redirected to the Snow White page, where they could view trailers and browse photo galleries and buy tickets to screenings of the film, among other things. It obviously worked, as the film was one of the surprise hits of the summer, outstripping the likes of Prometheus and Battleship at the box-office.

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Image via Mobile Marketer[/caption]

Target

For Christmas 2010, American megastore chain Target introduced its iAd, which functioned as both an ad and an inset ad, featuring on large apps such as that of the New York Times. If users didn't engage, it would still function as a static ad, promoting the chain to discerning users of popular apps, but they also had the option to click and be taken to the "Merrymaker" gifting app.Essentially a full-page interactive ad, the Merrymaker presented users with gift ideas for the holiday season and general tips to help them cope with the demands of Christmas or on how to make their Christmas a little more festive. A clever and malleable campaign.

Coca-Cola

The soft drinks giant is no stranger to expense and innovation in advertising, and the Freestyle app and corresponding vending machines, launched in 2009, prove as such. The freestyle app is laded with games and tasks that encourage socialisation and sharing on social media, but the app also works as a remote control for vending machines spread around major American cities.

Big whoop, right? Wrong. These weren't any old vending machines. These vending machines contained over 100 drinks and allowed users the chance to create their own cocktail of said drinks if they so pleased. Over the top, fresh and, with 41,000 interactions to its credit, clearly doing something right.

Glamour Magazine

Last September's print issue of Glamour magazine had digital content and interactive competitions, thanks to the work of the fine folks at SpyderLink. The magazine captured over 100,000 users for its app by using mobile barcodes. The scans allowed advertisers to gather data from smartphone users and led the users to exclusive content; the move led to an 18% increase in Glamour's Facebook fans.

By taking pictures of the links and sharing them, users could also unlock gift coupons and other discounts online. A smart way of incorporating mobile users and guiding them to both online content and to advertisers. This isn't the first time Glamour has incorporated SpyderLink into their campaigns. They also used it for its Taxi Shops campaign to help promote their Fashion Week back in February 2012.

American Express

American Express teamed with mobile developers Zumobi in a bid to bolster, diversify and prove their mobile advertising. Its aim was to create a more personalised experience for their users, while also incorporating video, social media and user-generated content. Users sync their cards with social media apps to learn the latest offers on products that they would find intriguing or essential and have the ability to view other people's profiles as well as share their purchases and what not. It's an app that uses the social aspect to power consumer demand and sustain spending.

Heineken

Heineken developed the StarPlayer gaming app in time for the 2010-2011 Champions League final. Fans, of course, access their mobiles to interact and chat with absent friends and followers about the game they're watching, so Heineken were aiming to tap into this in-built audience as one of the competitions main, most visible sponsors. The app would ask in-game questions about statistics and ask users to give their opinions on the game as it progressed, and it certainly paid of for the famed lager company.

Axe (Lynx)

The deodorant kingpins created a fun little game for its users, that played to its male demographic and gave them a little puzzle to solve. Supplemented by a print ad that sent users to this mobile app, Axe beckoned its fans to complete a picture of a young woman who wasn't wearing much of anything. It's a clever and titillating ad that played directly to the core demographic in a cheeky manner and promoted the brand extremely well.

Starbucks

Finally, coffee giants Starbucks created a very useful, everyday app for its customers that both promoted their product and made it easier for customers to acquire it. 6,800 Starbucks outlets were equipped to handle mobile payments from customers using the Starbucks app; it allowed user to pay via PayPal/credit card and rewarded them with offers.

They simply scan their phone at the register and avoid any hassle, fiddling for change in their wallets etc. The app made payment more efficient and increased customer satisfaction and brand loyalty with over three million users as of June 2011. Google, for once, had been caught napping and are now looking to implement the innovative 2-D code scanner that Starbucks used to power this great time-saver.

The company has expanded its mobile payment services by teaming up with Square, which will see its services featuring in 7,000 U.S. stores along with investing $25 million in the company.

Future Trends

Despite the rapid advancements made in the mobile sector, there is still a long way to go before it becomes the core of any marketing strategy. While it's safe to say that mobile advertising is the future, here are a few areas which will be improved over the coming years.

Improved relevance, behavioural targeting

One of the benefits of mobile is that it's portable and with location services growing in popularity, it's easier than ever to know where your audience is. More importantly, you can find out when they're in the vicinity and will be handy for fixed business and brands like cafes and restaurants.

But alongside that, marketers will be able to target ads based on location, time and their behaviour. Apps like Foursquare has already done the latter by using the data from check-ins to display relevant ads and updates that would interest specific users. The next few years will see a substantial improvement in these services and what results they can generate.

Increased focus on interactivity

Currently, the majority of ads are either banner or text, presentable but give you little reason to click on them. As consumers become more accustomed to the capabilities provided by smartphones, the hunger for more interactive means of advertising will increase. Further down the line, users will have grown accustomed to AR, interactive ads that encourage you to participate and media rich ads that incorporate video and audio into their message.

There are some examples of interactive ads out there, but the majority require you to download an app to experience them. Future advertising campaigns will bypass this requirement, allowing users to jump into the experience immediately.

Mobile search

Tying into the concept of geo-location services, mobile search will continue to be a major source of revenue for Google and with the possible inclusion of social and other services like Google Now and Siri, these ads could be even more focused than before.

Measuring ad performance

Currently, we measure the success of ads on a CPM or cost per click basis, but the terms we use to measure the success of desktop ads doesn't necessarily mean a perfect fit for measuring mobile ads. Analysing the success of mobile campaigns is currently a problem as not everyone has access to the necessary tools to successfully measure these ads. In future, companies and brands will have developed a much better idea about measuring mobile ads and the analytic tools available will have improved to reflect this.

Infographic Sources

- http://www.emarketer.com/PressRelease.aspx?R=1009228

- http://www.mediapost.com/publications/article/170935/mobile-growth-influenced-by-clicks-on-paid-search.html

- http://www.gartner.com/it/page.jsp?id=1726614

- http://www.theverge.com/2012/6/11/3077792/apple-wwdc-2012-stats-ios-mac-growth

- http://yourstory.in/2012/06/google-play-quick-stats-key-takeaways-google-io-2012/

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