INSIGHT: Understanding The Real Mobile Advertising Opportunity
Editor’s Note: The market is poised for growth. But how can mobile operators gear up for this opportunity? Lisa Cianguilli offers some business guidelines that deliver results.
The advertising industry is huge, with an estimated value of $1 trillion (Source: WPP, STL, Kelsey Group, PWC). While about half of that amount is spent on traditional advertising (including print, radio and television), the market is largely flat. Traditional media simply don’t provide the level of response advertisers are looking for. It’s also becoming increasingly difficult to reach audiences over the usual channels (consider the impact of the PVR on television advertising!).
Most importantly, traditional advertising doesn’t enable brands to measure how many people view an ad. Digital advertising, on the other hand, is a healthy, dynamic market with the potential for an excellent return on investment. It also offers the personalization needed to improve targeting, relevance and responsiveness. And thanks to the proliferation of mobile devices, the mass consumer audience is there.
To date, the majority of mobile advertising is delivered over the top (OTT) of your networks. You’re providing and maintaining the roadway for advertisers to communicate with your subscribers, but you’re not getting a great return on that investment. It doesn’t have to be that way.
Take advantage of your advantages
As a mobile operator, you have a unique advantage over other media owners: your direct relationship with your subscribers. You can leverage that relationship, along with your mobile network resources, to become a valued participant in the mobile marketing and advertising value chain.
As you explore new opportunities for mobile advertising, keep the following guidelines in mind.
1. Protect your relationship with subscribers by focusing on permission- and preference-based advertising. This will ensure that your subscribers regard the service as a benefit, not a nuisance. In fact, by delivering messages that your subscribers want to receive, you’ll be giving them another reason to stay with you as their provider. An effective mobile advertising service will also help to differentiate you from competitors and draw new subscribers to you.
2. Emphasize services that offer the best ROI potential. Currently, you may be offering bulk SMS to media agencies at the lowest possible cost, but this approach does not realize the highest possible return for you. Instead, focus on creating higher value mobile media that is permission- and preference based. This gives advertisers a responsive and scalable channel to engage in conversations with your subscribers. It is much more valuable to marketers and advertisers, and therefore yields a much higher return.
3. Develop a compelling service that differentiates you from competitors. You’re going to be competing head-to-head with application and content providers that already have both mindshare with your customers and strong media relationships. To attract advertising budgets your way, you’ll need to offer something different and better, with a measurable ROI so marketers and advertisers can easily see the added value. In addition to supporting permission- and preference-based advertising, you will need to be able to provide the kind of reach brands are looking for. Advertisers want to distribute their advertising message to a wide audience — beyond local boundaries to national and international audiences. One way of accomplishing this is by working with a partner to aggregate your advertising inventory with that of other mobile operators.
4. Seek opportunities to partner with experts in the marketing and advertising field. The right partner can help you overcome any relationship gaps that may exist between you and advertisers. Ideally, the partner will help you sell your advertising inventory, so you can remain focused on your core business, while the partner looks after the day-to-day mechanics of providing a mobile advertising service.
Timing is everything
Mobile advertising offers an optimal balance of reach and effectiveness. It provides a more direct connection to consumers, simply because of the incredible proliferation of mobile devices, and because it is the most personal of all media. While this form of advertising is still in its infancy, it is expected to grow significantly over the next few years. The greatest rewards as a provider of mobile advertising will be won by those who
get out in front of competitors with an effective, easy to use solution that meets the marketing and advertising industry’s requirements head-on.
Leading the conversation
In the last two years, Alcatel-Lucent has made significant investments in the advertising arena, building relationships and developing innovative strategies for tapping into mobile advertising and marketing opportunities. Our leadership in mobile advertising has been recognized by the Mobile Marketing Association (MMA) by designating Alcatel-Lucent a Premium Member of the MMA. The MMA reserves the Premium Member tier to companies with the scale, scope and resources to effect genuine change in the marketplace.
We’ve just launched Optism™ a powerful permission-based mobile marketing solution that will help mobile operators as well as marketers and advertisers to make the most of the mobile advertising opportunity. For more information, go to www.alcatel-lucent.com/optism and www.optism.com.
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Lisa Ciangiulli, Director of Marketing for Alcatel-Lucent Global Advertising Solutions, where she has been instrumental in the development and marketing of Optism™, Alcatel-Lucent’s powerful permission-based mobile advertising solution. In this role, and throughout her career, Ciangiulli has spearheaded efforts to encourage cooperation between players across the ecosystem with the ultimate goal of enabling closer communication with the consumer. In May she was named to the Mobile Marketing Association (MMA) North America Board of Directors. You can follow her on Twitter (@LisaCiangiulli).
Disclaimer: Optism is an MSG supporter.
