September 20, 2008

A few years back, I had the opportunity to focus my attention and efforts on the mobile category. I hesitated, because I felt mobile was a bit too far off from becoming a mature medium. The running joke for the last five to seven years has been that mobile was always "three years away from becoming a viable stand-alone medium.". That was the case up until recently. I think mobile just had its growth spurt!

Mobile as a medium has not evolved completely into what it will become, but it has advanced dramatically in just the last year. The mobile marketing model has grown far beyond the limited components of WAP because the smartphone has evolved into a true computing platform, moving beyond the standard format of a "phone with benefits."

For those of you who are looking at mobile as a medium, let's review the landscape of the opportunities that are afforded to you as content developers as well as marketers:

a.WAP vs. HTML: Most standard phones can view WAP pages (WAP stands for Wireless Application Protocol). WAP sites are text-heavy and viewing them is clunky from a consumer perspective. HTML is the standard for Web site development, and many of the new smart phones such as the iPhone and the Samsung Instinct view Web pages as HTML so the standard ad units on those pages are served, albeit not in Flash. This translates to the fact that many standard ad units can now be seen on these next-gen phones. What's still confusing to me and many marketers is how this impacts page views and ads served in a standard reporting environment, but that's getting worked out even as we speak.

b.On-Deck vs. Off-Deck: The term "on-deck" was always used to refer to OEM-placed applications that came with your phone when you bought it. It was hard to get "on-deck" and it usually came at a significant price. The launch of the App Store changed that paradigm and now anyone can place an application on the deck of the iPhone, assuming that application has been approved by Apple and distributed through the App Store. The upcoming Google Android phone has an App Store of its own and most major carriers are working on their own versions as well. Even the BlackBerry has a couple of competing application stores coming into the marketplace.

Once you understand these two basic landscapes, you can examine the advertising opportunities that are available as well. Standard mobile campaigns used to consist of WAP ads and SMS or click-to-call interactions. SMS specifically was used in many situations as an extender tool to provide interactive capabilities to print, TV and radio. I still like SMS, especially when packaged together with SMS search, because almost all phones in the marketplace currently can make use of them. Companies like 4INFO do some very interesting things with SMS as a connection tool and are worth checking out.

The immediate growth of the application space has created an environment for more Web-standard-type ads being integrated into the mobile environment. There are text ads, such as Google AdSense, baked into games and services (see AdMob in the Sports Tap application in iTunes) and there are full-screen static images (see the full-page units in the 21Pro Blackjack app also available in iTunes). There are also branded applications themselves (see the Audi A4 app or the MobileZodiac brought to you by the Chicago Tribune). These apps have ads baked in through differing formats, but as a consumer I'm not annoyed by them. They may indeed be intrusive in some cases, but not in a way that is too detrimental to the brand. (The most annoying of the ad formats that I came across would be the full-screen ad for "Star Wars: The Force Unleashed" which comes before the Lightsaber app, and even that's not too bad). One additional note on this format: the integration of GPS in these applications immediately increases their performance, because you get information tied to where you are right now. I've seen a couple of examples of location-based mobile ads and they've resonated strongly with me.

Mobile video is still the missing link. Many carriers are offering mobile video (Verizon VCAST being the apparent leader) and in some cases there is advertising baked in (mostly 5-10 second commercials or pre-rolls). This component of the medium still has room to grow, as the platform itself continues to evolve and becomes a better, faster, more reliable platform for accessing video content -- and consumer behavior changes to accept and expect this format to be available to them.

Lots of changes are afoot; it remains to be seen what effect the recession will have on the mobile category, but as prices for these next-gen phones continue to come down and users are thrifty with their time and their spending, I don't see them straying away from these tools. I see them adopting them even more. Do you agree?

By Cory Treffiletti
Cory is president and managing partner for Catalyst SF.
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