Advertising Week 2007

Mobile Marketing Has Hurdles to Overcome

But Panelists Predict Category Will Be on Every Top Marketer's Budget in '08

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NEW YORK (AdAge.com) -- Mobile marketing is on the verge of breaking out in the U.S., but there are some real barriers to overcome first, said panelists at Ad Age's Digital Bites panel at Advertising Week today.
John Hadl
John Hadl Credit: Scott Gries

"This train is leaving the station, it's off," said Paul Cushman, director-mobile sales strategy at Yahoo. John Hadl, founder and CEO of mobile marketing strategy firm Brand in Hand, which has worked with major marketers such as Procter & Gamble Co., predicted that by 2008, 5% of digital budgets will be mobile. Larry Harris, president of Interpublic Group of Cos.' mobile agency Ansible, said that by next year, all major marketers will have mobile as a line item in their budgets.

Agencies will benefit
Moreover, agencies are poised to make a lot of money by creating mobile content, building and developing mobile applications, and buying media in the space. But the question is, here exactly should they start?

Start by delivering on a brand promises, said Richard Ting, VP-exec creative director for digital agency R/GA's Mema Group. At the panel, moderated by Ad Age Digital Editor Abbey Klaassen, he showcased a mobile interface R/GA created for Nike Zoom that features videos of athletes doing a 28-day training program, along with offering store locations and product information. The idea, Mr. Ting said, is to create content entertaining and valuable to the consumer.

"We wanted to create an experience for the consumer that would help them obtain quickness," which is what Nike promises, he said.
Panelists Paul Cushman, Richard Ting and Larry Harris
Panelists Paul Cushman, Richard Ting and Larry Harris Credit: Scott Gries

Others, like Jonathan Bulkeley, CEO of Scanbuy, see mobile marketing going in a more utilitarian direction. His mobile firm uses a technology with which consumers can scan a barcode via camera-phone on a head of lettuce to get information (such as the date it was picked) sent to their phone. He predicts that within the first quarter of next year, this barcode technology, which is used widely in Japan, is going to be widespread within two to three years.

Benefitting traditional media
Mr. Hadl talked about the ways mobile devices can increase the efficacy of traditional media, citing his work with Scope, which allowed consumers to text wallpaper of kisses to their friends.

But the panelists conceded there are major obstacles to overcome before mobile marketing becomes ubiquitous. The first problem, according to Mr. Hadl, is that most cellular phones still work on independent networks. Apple and T-Mobile have started to use Wi-Fi technology. Another issue, he said, is compensation models -- do marketers buy impressions or play per clicks?

"We're having a lot of problems with currency on the buying side, it's causing some pain," Mr. Hadl said.

Dealing with carriers is a third problem, the panelists said, as many are hesitant to enter the space because of consumer fear of getting spam on their phones. Mr. Ting pointed out how long it takes to do even a text message campaign -- each carrier has its own sets of regulations about short code, or the mobile phone version of a URL -- and dealing with budget approvals for each carrier can take a long time. "This ecosystem has to develop," he said.
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