Mobile Marketing - Current Issues

Author: Laura Flanagan

Mobile Marketing: Current Issues and Future Trends

Table of Contents

1.1 Introduction 4 1.2 Defining Mobile Marketing 4 2.1 Types of Mobile Marketing Communications 4 3.1 Brief Overview of the Mobile Marketing Industry 9 3.2 Mobile Marketing Implications for Marketers 10 4.2 Future Trends 13 Conclusion 13 Appendix 14 References 15

“Mobile Marketing – Current Issues and Future Trends”

1.1 Introduction This report intends to explicate the fundamental nature of mobile marketing communications and elucidate its significance for today’s marketers. Furthermore, the report will also focus on what key trends mobile marketing is likely to face in the future.

1.2 Defining Mobile Marketing

Firstly, mobile marketing is pertinent to all of the “activities undertaken to communicate with customers through the use of mobile devices” such as the dissemination of promotional offers and information on product and services, (De Pelsmacker, Geuens and Van den Bergh, 2007). Hence, mobile marketing employs mobile devices as the primary communication platform for promoting products and/or services to customers. Mobile phones, smart phones and computer tablets are all considered to be mobile devices.

2.1 Types of Mobile Marketing Communications

This section of the essay aims to classify the various types of mobile communications that are currently available to marketers. For the purpose of this report, we shall focus on eight major types of mobile marketing communications.

1. SMS (Short Message Service)

A SMS is defined as a message that is sent via a Short Message Service. A SMS is generally referred to as a text and is 160 characters long, (Mobile Marketing Association, 2013).
In this particular context, a SMS or text is sent out to potential customers’ mobile phones, the content of which typically relates to news, offers and promotional codes for discounts or even a link to a web page. It is important to note that having a mobile website may improve the effectiveness of SMS marketing given the fact that there is the opportunity for customers to access content instantly from their mobile device. For example, a company could market their products/services by texting customers with a promotional code for an online discount with access to a mobile site which would, in turn, permit them to redeem this online discount from their mobile device, (Pitney Bowes, 2013).

SMS marketing is relatively inexpensive as many service providers offer free allowances and discounts on bulk bundle packages. However given the restrictive length of a text message -160 characters in length - it is vital that the content of the message is clear, well-branded and engaging and rewarding for both parties involved. Another issue with SMS marketing is that it is prerequisite that consumers choose to ‘opt-in’ to receive texts messages, (Quirk, 2009).

2. MMS (Multimedia Messaging Service)

MMS is similar to SMS except for that it includes the addition of multimedia content such as pictures, audio files and video clips, (Mobile Marketing Association, 2013.) MMS is more expensive to use due service providers charging more for the inclusion of multimedia content. However, MMS tends to have more of an impact, when used effectively, as the message may be expressed in a more engaging and creative manner.

3. Mobile Applications

Mobile applications or ‘apps’ are basically seen as computer programs that typically operates on mobile devices. There is an enormous range of apps available today which fall into a wide array of categories.
Consumers can download apps from various sites depending on phone, such as “iPhone (App Store), Android (Google Play), Blackberry (App World,) or Windows Phone Store (Windows Phone Store”, (BBC, 2012). Some of these apps are free for users while others charge a small nominal fee to download the app, (Noble, 2013).

Mobile apps can be an effective tool for marketers to use as advertisements can be placed into these applications to help promote a brand, product or service, (QT Talk, 2012). For instance, Special K developed a free app that enables users to create personal weight loss plans with an array of additional features such as an online food tracker, daily menu plans and shopping lists. Due to the market positioning of Special K, this app is effective in promoting its brand and products amongst potential customers. The figure below illustrates what the user-friendly app looks like.

Figure 1: My Special K Mobile App

(Special K, 2013). 4. WAP Site (Wireless Application Protocol)

A WAP site can be defined as a website that has been specifically designed and formatted for viewing on a mobile device, (Mobile Marketing Association, 2013). When an individual tries to access a website from a mobile device, it is redirected to the mobile version for better user experience, (Jeff Hurt, 2011). A WAP site is necessary because most regular websites are not usable for display on mobile devices due to the fact that mobile devices have smaller screens. Thus, a WAP site is a prerequisite for reaching mobile customers, (Pitney Bowes, 2013).

5. Mobile Advertising

Mobile advertising most commonly refers to “Mobile Web Banners (top of webpage), Mobile Web Posters (bottom of page banner), and full screen interstitials,” which pop up whilst the requested mobile web page is still “loading,” (Mobile Marketing Association, 2013).

Ads need to use a different format for mobile phones than viewing an ad on a computer. The cost of mobile advertising can greatly vary, however it is usually measured using a Cost per Mille (CPM) basis where the advertisers pays a fixed sum for every 1,000 views. Some of the major suppliers of mobile ad networks include Google (Admob), AOL (Third Screen media) and Apple (Quattro Wireless), (Inc., 2011). Other forms of this type of advertising are mobile gaming adverts and mobile video adverts, (Mobile Marketing Association, 2013).

6. Mobile Paid Search

Mobile paid search is virtually the same as a standard PC Paid Search except for the fact that the number of results shown on a mobile device screen is only up to 4, whereas a normal PC can display up to 10, (Noble, 2010). There are two types of mobile paid searches, which are mobile paid inclusions and mobile paid placements/‘sponsored listings’, (Jeff Hurt, 2010).

7. QR Code Marketing (Quick Response Codes)

QR codes enable a consumer to visit a webpage address by scanning the 2D image with their mobile phone camera, thus negating the need to manually enter a URL . However, users must first download an app that enables their mobile device to read QR codes. The use of these QR codes is currently very popular tool used organisations as it is a quite novel yet effective way to drive traffic to specific content, (Pitney Bowes, 2013; Fill, 2009). The picture below is an example of what a QR code looks like.

Figure 2: Special K - QR Code

(Battlecreek, 2010)

8. Bluetooth Wireless Proximity Based Marketing and Location-Based Marketing

Bluetooth Wireless Proximity Based Marketing and Location-Based Marketing work in quite a similar manner as location specific mobile advertisements are sent to consumers according to where their GPS enabled or Bluetooth enabled mobile phone places them, (Phone Marketings, (2013). Hence, both tools are effective in helping to disseminate information that is relevant to the receiver. For instance, the likelihood of an individual joining a leisure centre is greater if the premises are within a relatively close proximity, (QT Talk, 2012).
3.1 Brief Overview of the Mobile Marketing Industry

It is fair to assert that advertising seems to have become a rather ubiquitous feature of modern Western society. The prevalence of which has been, to some extent, due to an array of recent technological advances that have permitted consumers with greater access to media exposure and more versatility in media selection. In particular, the emergence of mobile marketing can be seen as quite a revolutionary way of communicating with customers, as it is one of the first new marketing channels to evolve in over fifty years, (Mobile Marketing Association, 2013.)

The total value of the global mobile marketing industry is currently around $14 billion, which is equivalent to around €10.5 billion. Recent research published by Berg Insight suggests that this figure will rise to a total value of $22.6 billion by 2016, an increase of 37% in growth of the market, (Mobile Marketing Watch, 2012).

Currently, around three quarters of the world population now have access to a mobile phone, (World Bank, 2012). The Irish mobile phone industry is very saturated with over 84% of Irish households’ owning at least 1 mobile phone, (CSO, 2007). This figure has since risen to 96% according to results from a recent study (Commission for Communications Regulation 2010, cited in Irish Examiner, 2010). In addition, smart phone usage has grown in recent times due to its increasing availability to consumers as using a mobile phone to access the internet has now become the norm. A recent Irish study into smart phone usage, undertaken by Sponge It, published results which found that:

* 46% of smart phone owners surf the internet on a daily basis; the next most popular use being checking emails (39%) social networking sites (39%) and for making news enquiries (36%)

* 18% of smart phone owners watch video content on a daily basis.

* 16% of owners clicked a mobile advert recently.
(Mindshare, 2011). However, it is important to note that the study also found that while half of the respondents own a smart phone, not all use the smart phone features with 54% of the 1,007 respondents stating that they did not use their phone for internet. Hence, it may be beneficial retain more basic mobile marketing tools, such as SMS texting, to ensure there is an optimum coverage of the target audience. In addition, the Irish Internet Association published findings showing that a significant 82% of Irish smart phone owners research their buying decisions on their mobile phones, (Irish Internet Association, 2012, cited in Mobile Jobs, 2012). Thus, there is adequate evidence to exemplify that the mobile marketing industry is experiencing strong growth, both on a domestic and international level. 3.2 Mobile Devices and its Implications for Marketers

The widespread adoption of mobile phones amongst consumers in Western society signifies a huge marketing opportunity for marketers to reach consumers anytime, anywhere (Grant and O’Donohoe, 2007; Roach, 2009). There are a number of features that are unique to mobile phones that pose both opportunities and challenges for marketers, which are namely that:

1. The mobile phone is personal. * A respect for privacy is extremely important in all aspects of marketing, but especially when it comes to mobile phones. It is prerequisite by law that mobile device users have to give permission by opting-in to receive marketing messages directly to their mobile devices, (Ahonen, 2008). Due to the innately personal nature of mobile phones, it is important to consider any potential privacy concerns such as sending unwanted messages or spam to mobile device users, (Fill, 2009).

2. The mobile phone is always carried. * Messages sent to recipients can be read and acted on instantly, in comparison to email, messages that are sent to mobile phones are most likely be accessed within minutes or hours of being received, (Ahonen, 2008). Thus, in this sense it is virtually possible to reach consumers, at any place, anytime, (Fill, 2009).

3. The mobile phone is always on. * This provides mobile phone users with the opportunity to readily interact with brands anytime, (Fill, 2009). However, this also means that marketers need to be more considerate about when to deliver its marketing communications, for instance, naturally, it would not be appropriate to send recipients a SMS text at 3 o’clock in the morning to notify him/her of a special offer, (Ahonen, 2008)

4. The mobile phone has a built-in payment system. * Advertising is not the only way to generate profit for content as consumers are more willing to pay for services and content from their mobile device .

5. The mobile phone is available at the point of creative inspiration. * Phones today feature a number of tools that let users act on a creative impulse, such as taking photos and videos and sharing of content on social media sites. This feature can be used to encourage interactivity with mobile campaigns; it presents the mobile as a useful tool for viral campaigns that rely on consumer generated content, (Ahonen, 2008).

6. The mobile phone can provide accurate audience measurement. * Cumulative data provides extensive profiling and segmenting opportunities for reaching a specific audience. Campaigns can also be accurately measured and tracked for ROI. Be aware, that while mobile phone users have far less anonymity than Internet users, network operators decide the data that they are willing to share with a marketing company, which can limit the amount and nature of information available, (Ahonen, 2008).

4.1 Current Issues

This section of the report will focus on the current issues pertinent to mobile marketing today. According to Quirk (2009), the primary issues currently facing the mobile marketing industry can be classified into three main categories, which are namely as follows:

1. Few Standards:

Mobile devices such as mobile phones are less standardised than PCs. Mobile phones present with a multitude of screen sizes while in addition, there is quite an array of operating systems and browsers utilised by mobile phones.

2. Privacy and Permission Concerns:

Marketers must be conscious of the fact that users tend to have a close connection with their mobile phone due to the fact that they are nearly always with the user. There are four major privacy concerns evident today, which are personal identification, wireless security, location information and mobile spam, (Quercia, et al., 2011). Thus, in order to counteract these kinds of concerns, marketers should readily provide clear instructions on opting out of its marketing communications.

3. Questionable Navigation

In relative comparison to PCs, mobile devices are quite small – a smaller screen and a smaller keypad. In addition, some models have a full QWERTY keypad, while others have a standard numeric keypad which in turn, can detract from the browsing experience for some users

4.2 Future Trends

Although the mobile marketing sector is growing rapidly with an abundance of innovations and upcoming potential trends, for the purpose of this report, focus of this section will pertain to two key future trends - which are NFC (Near Field Communications) and AR (Augmented Reality) initiatives.

1. Near Field Communication (NFC)

Near Field Communication can enable consumers to use their mobile devices to interact with many real-world objects such as posters, clothes and shop windows. The user taps a chip that has been placed on an ad with their mobile device, which then directs it to perform an action, such as open its mobile web or make a call, (Phone Marketings, 2013).

NFC is a hot growing trend for 2013 as it has the potential to much more then it is doing now. An example of an application that uses NFC technology is Google Wallet which allows users to make mobile payments and can fulfil the same functions as store debit cards, credit cards, loyalty cards and gift cards. All the user has to do is simply tap their mobile on any Pay-Pass enabled checkout, (Mobile Commerce Daily, 2012; Google Blog, 2011).

Figure 3 Google Wallet

(Google Blog, 2011). 2. Augmented Reality

In essence, Augmented Reality

Conclusion

Appendix

1. Mindshare Info-graphic

(The Sociable, 2011)
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