IAMAI Conference: Mobile advertising has a long and complex road to travel

By Chhavi Tyagi , afaqs!, New Delhi | In Digital | July 03, 2009
The mobile advertising industry has a long way to go, though the platform provides marketers with unique characteristics and advantages

Raj Singh, executive director, Active Media Technology opened the second panel discussion of the Fifth Digital Marketing Conference, organised by the Internet and Mobile Association of India (IAMAI) in New Delhi. He quoted some interesting figures on the Indian mobile industry and the ad spends on the medium.

Discussing the evolution of the mobile advertising industry and emerging trends, he shared a report, which puts the Indian media industry at US $5 billion; while the mobile ad industry gets around US $10 million of the entire pie. The global mobile ad industry is expected to grow from 0.5 per cent to 1.5 per cent.

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He added, "The irony is that mobile has the second largest reach, next only to television in India, while radio, print and internet come much later." Also, India ranks third in the WAP (wireless application protocol) usage category, after the US and Indonesia.

Singh said that some of the factors, which will provide a boost to the mobile ad industry, are new technology, new applications, new business models, better handsets and network, better targeting of consumers and better penetration of mobiles, especially in rural markets. He added that platforms, applications and services will enable creation and monetisation of mobile media assets across all formats, such as SMS, MMS, WAP and voice.

After sharing the details on the mobile ad industry and its drivers, the discussion was handed over to the panel, comprising Vish Bajaj, chief executive officer, Value First; Jagdish Mitra, chief executive officer, CanvasM; Vivek Malhotra, assistant vice-president, marketing NCR, Idea Cellular and Atul Madan, vice-president, mobile, Comviva.

Bajaj shared the size of the market, which he said industry insiders put anywhere between Rs 40-100 crore. He added that it is very difficult to determine the size of the industry, "as what you define as a promo and what as simply providing information is not very clear".

On identifying techniques for designing and delivering a mobile advertising campaign, Bajaj said that it is a pot full of constraints. "It is only through a collaborative effort that a good campaign can be designed. The effort has to be two-way, between brands or agencies and service providers, who need to explain the technical aspect of the medium to brand managers."

He said there are lots of players such as MyToday, which are burning their money to create an ecosystem where advertisers can easily reach subscribers. These companies are not making money out of their core business; and most of them are looking towards additional revenue to sustain their businesses.

On the subject of driving mobile advertising by delivering a personal and relevant experience, Bajaj said that it can be possible either through push strategy or pull strategy. While a push could fail if the consumer is not there, a pull strategy could fall flat on its face if the consumer profile is not kept in mind. For instance, an SMS for an offer in a store in Mumbai getting delivered to a customer situated in Delhi.

He emphasised that there was a need to create personalised ads for a specifically defined target segment, adding that SMS advertising will keep growing and continuing to lead revenues for mobile advertising.

Next on the dais was Mitra, who said that mobile advertising in India follows the "Spray and Pray" pattern of mass advertising -- an SMS ad is sent to anyone and everyone; and that is why mobile ad spends are as low as 0.2 per cent in the country.

"The important factor in mobile ads is to get it right in terms of whom to target and how to get that message across. Though mobile as a device is used by 350 million people, the reason it is not successful is because advertisers and clients alike do not know who to sell what. Unless that knowledge is there, it being next to television is not going to make any difference."

Citing the example of a US company which worked very hard on creating a database of its customers, Mitra said there has to be a sharper focus on behavioural targeting. The company in point created a campaign, which got many people, if not buying the product, then at least enquiring about it. The next campaign was then worked out to contact those customers who had evinced interest in the product during the first campaign.

He also pointed out that most of the mobile ads are just replicas of television ads -- that is one of the primary reasons that mobile advertising is failing. "There is a right time and a right audience for mobile ads. Companies can't just use this medium the way they use television," Mitra emphasised.

The next speaker, Malhotra began by saying that there are two schools of thought on mobile ads -- one which thinks that it is undervalued; while the other thinks mobile ads are overvalued. Malhotra himself believes mobile ads to be undervalued; he said that television people used SMSs to pull up TRPs of a big event such as the T20 World Cup.

He stated that as a medium, mobile ads can only work through opt-in model. "Mobile ads can only work if the consumer opts in and we have to create a new way of selling through this medium. Automobiles would not have been such a success if they were sold the way bicycles were."

Adding that there are many ways one can advertise on this medium, for example, some companies are selling ads as dialler tones, where the consumer gets paid for keeping that tone, and people calling him get to listen to the company's message.

The last member of the discussion, Madan wondered how difficult the industry has made it for the creative community to create ads or the medium. "I have a Nokia; somebody else would have a Blackberry, which will support a different format. We need something which will address these complexities of the medium. As long as we can provide relevant information to our subscribers, where and when they need it; it would not matter whether it was through opt-in or opt-out. I don't want an SMS when I am sitting at home, watching TV. If a company can reach me when I am out in the mall, about to make a buying decision, that's what going to make a difference. Mobile is the only medium which has that advantage of being with consumers, wherever they are. "

Also, he said that with mobile ads, there is no uniform concept of primetime. A housewife will have a different primetime, whereas a call centre executive will adhere to a different primetime.

Here, Bajaj added that today, Bluetooth enabled content distribution systems are available at places like malls, which solve the problem of opt-ins. "Since the consumer willingly switches on his/her Bluetooth, there is no question of irritating through push ads. So, there are ways to work our way around the problem of opt-ins and opt-outs."

On a question from the audience on how best to use the mobile platform for advertising and make optimum use of the different characteristics that mobile has, Singh of Active Media Technology concluded by saying that the most important characteristic of mobile ads is interactivity. "The platform is high on interactivity and can reach all kinds of consumers using this proposition. For instance, an uneducated consumer can also be reached through a voice SMS. With mobile, clients have the reach as well as interactivity. Brands have to just build their communication around these aspects."