Consolidation: How Will It Play Out in Mobile Marketing?

Electronics Advances Could Lead to Great Connections for Marketers

By Published on .

Most Popular

Ben Gaddis
Ben Gaddis
Your mobile phone is no longer just a phone. It's a mobile device. Your MP3 player. Your gaming station. Your camera. Your lifeline. It's called convergence, and what's happened on the device side is a clear sign of what's to come in mobile marketing.

Convergence is leading to consolidation among some of digital's biggest and most innovative players. Recently, Google acquired mobile ad network AdMob for $750 million. The implications are considerable. The deal makes Google a power in mobile display advertising. More importantly, AdMob now gives Google access to user data on many of the most popular mobile destinations, including iPhone apps -- data the company is sure to mine heavily in the months to come. Yesterday, Apple followed suit and acquired Quattro Wireless, another mobile ad network, seemingly chasing the same data.

The consolidation of mobile niche players -- ad networks, technology providers, agencies, publishers -- and the vertical integration taking place among larger players promises to dramatically reshape the mobile space. What does it mean moving forward?

What does it mean for brands?
Brands are demanding full solutions before they take huge steps in mobile marketing. In turn, Google, Yahoo! and Microsoft are naturally responding with vertical acquisitions that help them deliver integrated solutions to wider audiences. This consolidation will continue as market leaders move to fill gaps in their mobile offerings. Consolidation also means fewer options going forward, albeit stronger, more complete options. In the meantime, marketers need to identify mobile partners carefully. Considering how much of a moving target the mobile space is likely to be over the next 12 months, our advice is for brands to be particularly mindful of how legacy deals may play out over time.

What does it mean for agencies?
The breadth of mobile services providers -- SMS experts, application developers, Bluetooth host providers and the like -- can make even the most mobile-savvy heads spin.

Brands are asking for full-service solutions in the mobile space, and agencies, like other providers, are stepping up to play a critical role. Agencies can effectively step in as channel managers to identify and build effective mobile partnerships. As part of the recent consolidations, agencies are ramping up their mobile marketing expertise, in some cases even creating in-house mobile marketing services. If your agency doesn't have mobile expertise or tight mobile marketing partnerships, expect a bumpy ride.

Consolidation's role.
There's no doubt that mobile devices are changing how people access the Web and make purchasing decisions. How consolidation affects the emerging landscape is no small matter. There are looming questions as to whether consolidation will stifle innovation and give more power to the "sell side." We believe that consolidation will, in fact, make it easier for brands to do more and reach broader audiences in the mobile space.

On the media side, consolidation should be a godsend because it will give brands the scale they need to reach larger, less fragmented audiences via mobile. Indeed, the problem today is not the number of mobile users, it's that the market is so fragmented that audiences are difficult to reach with efficiency. Consolidation should help alleviate the reach problem while bringing cost savings to marketers.

What's likely to happen?
Consolidation in mobile marketing should bring efficiencies, innovations and reach. We hope the consolidation spurs advancements that have stunted growth in the mobile space thus far, including:

  • The ability to reach audiences at a level of efficiency most brands require to truly consider the space a viable marketing channel.
  • Point-of-sale integration that allows wider use of mobile devices in the purchase process, including near-field communications that enable devices to act like a credit card, bar code readers and other technologies that make mobile commerce a reality.
  • Standardization of Flash to give users access to a wider range of existing content on their mobile devices.

We'll all need patience as the natural market maturation process takes place. We've been through this same struggle on the Web. That experience informs us that as the mobile market evolves, everyone wins. Devices will improve. Customer experiences will be richer. Marketing opportunities we can't imagine now will surface and thrive. We're on our way to true one-to-one marketing that makes advertising more relevant than ever before.

Ben Gaddis is director of mobile and emerging media strategy at T3.
In this article: