‘Mobile, a Marketer’s Nightmare’ by Gareth Davies, Commercial Operations Director, Somo

We’ve all heard the pitch. Mobile is going gangbusters. Smartphones and tablets are creating a paradigm shift in the way we communicate, access content, engage with products, services and ultimately the world around us.

According to Mary Meeker, the app economy is worth $10bn and is growing 100% year-on-year. Angry Birds alone has seen more than 600 million downloads and mobile visitors to Twitter now account for 55% of the site’s total traffic.

Set this against a backdrop of declining PC shipments, as well as cannibalised desktop traffic as consumers vote with their fingers, and it’s easy to see why internet juggernauts like Apple, Google, Facebook and Amazon are all investing heavily in a bid to rule supreme over the holy trinity of hardware, software and services that make up our mobile world.

No surprise then that a wide range of mobile advertising companies are also investing heavily to develop the tools and technology required to help brands reach mobile consumers across the ever widening ecosystem of app developers, publishers and third party content providers.

The prize? Staying ahead of the competition as consumers shift to mobile. In 2011, US consumers spent 23% of their total media time on mobile, and yet advertisers invested just 1% of their $500bn global advertising war chest here. That’s either incredibly exciting, or incredibly worrying. Either way, it’s time to act!

However, before we become dazzled by this golden opportunity and place all our bets on mobile, let’s not forget one fundamental thing about mobile advertising -- it sucks. Why, I hear my detractors cry? Well, for these very reasons. Mobile advertising is:

Marketers who want true reach and scale need to buy across 20-plus blind or semi-blind ad networks per campaign, many of which are trading impressions or bidding against one another from the handful of ad exchanges, driving up the cost to reach consumers with little added value. Throw in a lack of robust audience targeting and tracking on the buy side and the result tends to be ‘spray and pray’ direct response campaigns that measure clicks and downloads, and little else.

Few networks offer campaign or reporting APIs, and by extension, an absence of centralised reporting dashboards for mobile marketers. Couple that with a lack of mobile-friendly ad serving and real-time bidding (RTB) solutions, disparate and questionable tracking methodologies and a near complete lack of audience data, and mobile marketers and agencies are forced into manual campaign management and optimisation. Not the most efficient way to reach and engage with your mobile audience at scale.

We’ve all been served those crappy in-app banner ads, rarely contextually relevant, not audience specific and certainly not rich, emotive or engaging. Not only does this lead to a poor consumer experience and a negative brand perception, but it robs advertisers of the ability to connect with users in new and exciting ways that only mobile can truly offer. Think of the wealth of location-based, dynamic, rich media, voice and image-aware, audio trigger and augmented reality campaigns that could be delivered to segmented and targeted groups, if only we had the technology tied together. Alas, we’re stuck with impressions, clicks and download strategies.

The race-for-the-floor, $0.01 CPC deals does nothing to boost the ecosystem. Publisher eCPMs are on average five times lower than on desktop, with average revenue per user (eRPU) 1.7 to 5 times lower. This not only spells bad news for publishers, but also for the wider ecosystem as it impedes the flow of ad dollars into mobile. This slows the pace of technological investment, insight and learning which is so crucial to solving the very problems of complexity and fragmentation.

So enough of this doom and gloom. How do we make mobile into the golden opportunity that it can and should be? My response is something of a call to arms.

First and foremost, we need skilled mobile practitioners to pave the way. This requires brands to invest in mobile-specific leaders who are capable of executing and measuring mobile strategies in isolation, as well as in the context of their wider digital and above the line activity. This simply cannot be done without the support of deeply knowledgeable, specialist mobile agency partners that understand the complexities and have the teams, technology and relationships in place to deliver results. So few network agencies have invested the necessary resources to answer these problems for their clients, and that’s a real shame.

Secondly, we need the technology infrastructure to help cut through the noise, increase efficiency and provide crucial data-driven insight. Buyers are desperately calling out for robust, made-for-mobile ad serving and campaign management tools, allowing access to ad networks, publishers and RTB-enabled exchange buys. Layer on rich media authoring tools, cross-device tracking capabilities, audience data and advanced optimisation strategies and you have the holy grail to plan, buy, execute, report and optimise mobile campaigns. Many technology players are talking about this vision, but few are yet to deliver the goods.

Finally, a change of focus is required. It is time to think beyond standard MMA ad formats, clicks and downloads, and to start better understanding our mobile consumers. We must invest in reaching our true brand advocates with relevant and engaging advertising. Not simply paid ad campaigns, but dedicated and dynamic branded content, offers and value-adding mobile communications that increase awareness, drive engagement and create a unique dialogue between the brand and the consumer, allowing for social amplification, truly earned media and, ultimately, more sales.

Consumers have voted with their fingers, now we as an industry must vote with our feet. Only when we address these three fundamental issues will we be able to create true value in the mobile advertising ecosystem, reverse the deflationary pressures of commodity display markets, make money for deserving publishers and deliver true value for media buyers. If we do this, not only will the buy and sell sides reap rewards, but we may even revolutionise the way consumers engage with and talk about brands. Now that, in my humble opinion, is a dream worth fighting for.