Are all mobile advertising forecasts wrong?

After going to both Mobile Marketing Live and Apps world and continually hearing (and saying) some classic stats for mobile – this article got me thinking…

A really nice and interesting article from  on AUGUST 13, 2012

“We’ve repeatedly stated that brands are underspending on mobile by at least 20-25 times based on time spent on mobile vs other media, the capabilities of the device and current growth rates (Brands only spending 1% of their budget on mobile). So what what should they be spending money on?

Currently consumer brands spend about 60% of their marketing budget on advertising including TV, online display, search, radio, newspapers, outdoor and of course mobile. The rest is spent on other marketing activities and tools such as events, branding, sponsorships, PR, production of websites, mobile sites, apps, social initiatives and more.

Naturally most analysts assume the growth to be proportional to the spend today which means that the greatest growth will come from mobile display and search advertising.

Investment bank Headwaters has a great analysis of this in their most recent Mobile & Wireless Sector Newsletter questioning if this assumption or as they call it “conventional wisdom” might be wrong.

We believe that advertising dollars that have been predicted to flow to social and mobile based on the historical trend of “dollars following eyeballs” will instead be repurposed outside of advertising. We expect a large portion those dollars to go to companies that are building technologies and services designed to take advantage of the unique properties of social and mobile Internet usage rather than companies engaged in traditional advertising.

The goal will be the same – consumer engagement – but the modality through which they reach the consumer will be different based on the unique capabilities that social and mobile Internet have to offer.

Headwaters might be right in their analysis.

Consumer engagement with advertising and brands is rapidly changing. A branded game such as Malibu Bowling can reach over 15m users at a cost of less than 150k USD which means 0.01 US per customer engagement versus display advertising at a CPM of e.g. 10 USD with a click through rate of 0.2% which means 5 USD per click.”

Now what I am thinking is this is GREAT news for EnterMobile – as we want to make games for brands – quickly and easily.

But is it good news for technologies like Blippar – with it’s mobile augmented reality?

Magnus continues – “Brands and agencies need to continue review their marketing budgets and innovate in the same way as they do with product development because conventional wisdom is wrong.”

So is it more that with technologies in the mobile space that bridge the gap between print and digital – such as augmented reality – that the spends will become blurred? And if so are we really just looking at greatmarketing rather than mobile marketing….vs print and outdoor.

Shazzam has some amazing figures about what they are doing with audio recognition – perhaps Blippar will do the same with print recognition.


Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s