By now you've no doubt heard the hype: The mobile phone is the most ubiquitous and personal digital device in the history of the world. According to the CTIA, there are more than two billion mobile accounts globally and U.S. consumers are sending over 10 billion text messages on their phones a month.
Has your head stopped spinning yet? Most brands I talk to ask the same question: What can we do now with mobile marketing to advance our interactive advertising plans?
To answer the question, it's helpful to review the three campaign mechanics used today in mobile marketing and how each supports typical marketing objectives. The three campaign types are (1) text messaging ("SMS," which is short for short messaging service), (2) picture messaging ("MMS," which is short for multimedia messaging service), and (3) mobile internet advertising ("WAP," which is short for Wireless Application Protocol, and refers to special formatting of internet content for mobile browsers).
But before delving into the mechanics, let's take a look at the size and demographics of the audience using their phones for more than voice calls. According to findings from the latest Enpocket and Harris Interactive quarterly Mobile Media Monitor, while there are almost a quarter of a billion wireless subscribers in the United States today, only about 71 million or 33 percent currently use some form of mobile media, beyond messaging. Twenty nine percent of female subscribers and 36 percent of male subscribers have accessed some form of mobile content in the past three months. Demographically, mobile data usage skews high in youth (18 to 24) and ethnic groups, such as African American, Asian American and Latin American. Users of media services tend to be higher income, with 38 percent of mobile web users earning more than $75K and users of advanced-features consistently using more multimedia services.
Text Messaging (SMS or Short Message Service)
Text messaging, hugely popular in Europe and Asia, is on a serious upswing in the United States. Ninety million Americans have sent or received a text message, with a high usage rate among younger Americans (up to age 24 more than 80 percent regularly text message), according Mobile Media Monitor findings.
The majority of those messages are person-to-person, but increasingly Americans are using SMS to interact with brands for such activities as interacting with TV shows (voting on "American Idol", trivia contests about program content on CNBC, program alerts for History Channel shows), on-pack promotions (texting an under-cap code on a Pepsi bottle for a chance to win an instant prize), driving buyers to retail outlets with mobile coupons (discount vouchers for Dunkin Donuts Lattes and EA games) and so on. Think of text messaging as the email -- sans graphics -- of the mobile world. Like the early days of the internet when email drove online activity, text messaging is the on-ramp to the mobile media world.
However, marketers can't just blast out promotional text messages to consumers without an opt-in. To secure consumer permission for push messaging, a brand invites the consumer to engage via mobile by texting into a five-digit number, called a short code. The mobile call-to-action is typically promoted in other media: TV or radio, a website, on a billboard, print ads or product packaging. This opens a world of push/pull interaction where the brand entices the consumer to engage, and the consumer then uses his/her mobile to get more information, express an opinion, download promotional content like a screen saver or a ring tone, purchase something, opt-in to receive alerts as part of a continuing push campaign or respond in some other form. It allows the interactivity of the internet wherever and whenever the consumer wants to engage with a brand, and not just during PC-face time.
Like an email, once a text message is received, it is stored on the phone until the user deletes it. This makes SMS useful for tactics like couponing where the deliverable needs to persist on the handset even when the network is not available. Text messaging's Achilles heal is that it is limited to160 characters, and does not support graphics. But when it comes to reach, there is no better way to engage with consumers on the most personal of devices.
Response rates depend on the program, but expect generic opt-in rates to range from one to five percent, with focused compelling programs (e.g., in-venue, on-pack promotions, affecting the outcome of a broadcast) to attain rates of 10 percent or higher. For example, a recent on-pack promotion that we ran for Pepsi drove almost one million text entries in the first couple months of the promotion.
In another example, Panasonic wanted to target the digital generation when launching its new state-of-the-art Oxyride battery designed for digital cameras.
To reach college-aged consumers, Panasonic sponsored the Jason Mraz concert series in 15 different venues last fall and invited attendees to text the word "POWER" to 69973 (OXYRD) for a chance to win a Panasonic prize package including a digital camera. The response rates to the Oxyride mobile campaign averaged 10 percent and were as high as 14 percent.
Picture Messaging (MMS or Multimedia Message Service)
MMS functions mechanically like SMS, but supports pictures, graphics, animation, video and audio-- it makes it possible to push a rich media advertisement to a consumer. And, like SMS, it is interactive so the recipient can respond to the message to purchase, sign up or opt in to future communication.
While MMS has about half the reach that SMS has -- 21 percent of all American mobile subscribers use picture messaging, according to the Mobile Media Monitor -- promotional MMS packs a much bigger punch in terms of activating a consumer. To see an example of what an MMS ad looks like, check out this recent Vodafone MMS campaign to promote mobile game downloads.
The ROI on MMS is quite compelling-- five percent is considered a low response rate to an MMS campaign. We have seen purchase conversion rates over 20 percent on well targeted MMS programs.
As an example, Samsung initiated a campaign to drive trial and download of the widely acclaimed "Skipping Stone" mobile game.
Using the rich graphics and animation, Samsung sent Samsung "Fun Club" members an MMS so they could preview the game, including a link to download a free demo of the game, and the option to purchase the full version of the game. The campaign generated an impressive 15 percent response rate. Check out this example of the MMS creative.
Since the U.S. mobile data capabilities lag behind other parts of the world, we are just beginning to see the first pilot campaigns here. But MMS has been a growing marketing phenomenon abroad and represents an interesting near-term way to leverage video until mobile TV penetration hits critical mass in the next 18 months or so.
Mobile Internet (WAP or Wireless Application Protocol)
The general sense of "wapathy" is subsiding in the United States with 30 million consumers now surfing the mobile web for news and information, sports scores and mobile content, according to Mobile Media Monitor findings. Advertisers are taking notice and are starting to extend branding and response campaigns to this desirable audience with mobile internet banner ads. Like banner ads on the web, mobile ads are small, clickable links that can take the browser to a landing page, where the user can interact with the brand, often with the option to click-to-call a merchant, receive a voucher or coupon, or even purchase mobile content.
One of the greatest benefits of mobile display advertising is that it provides a richer albeit small palette for brand advertising, while avoiding the need for an opt-in or consumer-initiated reply message. Clickthrough rates in the United States are generally between three percent and five percent but average up to 10 percent in markets like India, China and Japan, where more people rely on their mobile than PC for internet access.
While each mode -- whether push or pull, rich media or text -- has its advantages and challenges, best practices for mobile marketing often require integrating messaging with mobile internet for maximum reach with the greatest impact. Stay tuned for more on how these campaign mechanics can be orchestrated for maximum impact in my next column.