By Adam Carroll, Senior Marketing Strategist

For the past 5 years or so we’ve heard the same hype at the start of each year that “this year will be the breakout year for mobile advertising.” Whilst it’s true that mobile advertising has been increasing steadily each year, it hasn’t yet seen the predicted explosion and has remained a small consideration for digital advertisers.

At the beginning of 2010 there was once again a lot of noise about mobile finally gaining traction, but unlike previous years it seems that those sentiments are finally being proven correct.

Depending on what reports you read, there has been anywhere from a 15-45% increase in mobile advertising spend from Q4, 2009 to Q1, 2010. However, probably the strongest indicator that mobile has finally emerged is a survey conducted during Q1, 2010 which polled over 1000 US agencies. The survey conducted by DM2Pro.com determined that average client spending on mobile advertising would increase by 80% in 2010. This represents a significant shift in attitudes towards mobile that will likely see it become a serious part of the marketing mix during 2010.

So why, after several years of false starts is mobile advertising finally gaining the traction it has long promised?

One of the key influences has been the continued growth of smart phone usage. According to Nielsen, the number of US mobile owners using smart phones grew 14% in Q1 (2010) alone, and by the end of this year there will be 66% more smart phones in use than there were at the beginning. The effect of this has been a much larger mobile browsing audience who are increasingly using their mobile devices for web based activities over traditional PC’s. A recent Universal-McCann study found that 53% of US smart phone users download mobile content from the web at least once a day and click on mobile ads. That represents a large, engaged and relatively untapped audience for advertisers to reach.

A second factor in mobiles growth has been the fact that the mobile networks and ad platforms have stepped up their game, providing a wider range of ad formats and more sophisticated targeting techniques that cater to performance based and branding budgets alike. This has effectively negated some of the key concerns and hesitations that advertisers have had with mobile advertising in the past. More flexible formats and platforms have made mobile more appealing to a wider range of advertisers.

At the entry level, mobile search is becoming more sophisticated with networks such as Google enabling advertisers to set up text or image based campaigns from the Google AdWords interface. Not only does it simplify the set up process but it also enables advertisers to target their audience based on a number of criteria including device type (iphone, android etc) carrier (AT&T, Verizon etc) and geographic location of the user. The additional appeal of this type of campaign is that it is suitable for virtually any budget, making mobile advertising a realistic channel for smaller advertisers.

At the other end of the scale, rich, customized ad formats and extensive targeting opportunities have enabled blue chip advertisers to achieve results with effective brand placements. New technology has provided unparallel levels of contextual targeting and engagement. It’s now truly possible to reach an intended audience at exactly the right time, location and when they are carrying out a specific action on the mobile web. With Apple releasing their iAd platform this will further entice big budget brand advertisers to come on board in 2010.

Whilst it’s becoming clear that mobile advertising has arrived as a serious digital medium, it also must be noted that there are substantial benefits for those advertisers willing to put some focus on this channel:

Firstly, is the fact that display ads in mobile generate click through rates substantially higher than traditional online display ads. This is largely due to the fact that there are still comparatively few advertisers running mobile campaigns meaning fewer ads, less clutter and ultimately better cut through for current advertisers.

The other immediate advantage of mobile advertising is that it is still relatively inexpensive when compared to other forms of digital media, again due to the abundance of mobile traffic and lack of advertisers. In 2009 only 24% of mobile networks sold more than half of their ad inventory (DM2Pro.com) representing a great opportunity for new mobile advertisers to negotiate cost effective rates on both a ‘cost per click’ and ‘cost per thousand impression’ basis.

2010 certainly is shaping up to be the year that Mobile Advertising emerges as a significant digital channel. Those advertisers who are able to adopt this rapidly evolving channel will reap cost and performance benefits and gain an edge in a medium which is likely to become standard in most digital marketing plans from 2010 and beyond.

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By Craig Hordlow, Co-Founder and Chief Search Strategist

The Apple iPad, introduced by Steve Jobs in San Francisco on January 27, 2010, is unusual for Apple products in that the media knew most everything about it before Jobs’ presentation, and could only speculate for whom the device is meant and why they would use it.

The iPad is not filling any pressing unmet need, nor is it introducing us to any new technologies.  The iPad is an evolutionary step towards device integration.  If this step had been made by a less significant company, like Sanyo or Casio, it would have received little attention.  But Apple’s brand capital creates media fanfare, and its cultish following provides a forgiving consumer base.

There is speculation that the iPad will compete with e-readers. But the iPad has a computer screen that is hard on the eyes and while its portability may make reading easier, it is simply not an e-reader.

Apple knows that many people use computers primarily for getting on the internet and sending emails, and it streamlined this device for those people. The $700 price tag is welcoming but nothing more than that, especially in this economy. The virtual keyboard, while meant to simplify the device, is unorthodox, meaning it will be met with everything from confusion and frustration to satisfaction and joy. 

The risk that Apple runs with the iPad is cannibalization of its own products.  In his keynote address, Jobs said that “netbooks aren’t better than anything”, which was his inspiration for the iPad.  But having little more functionality than the iPhone, Seth Jayson (Senior Technology Analyst of The Motley Fool) quipped that the device reminded him of pictures in The Onion a year ago with Jobs telling his faithful following, “You must buy a large iPhone.”  The iPad, being something of a cross between a netbook and an iPod Touch, is not positioned to convert any segment of the consumer base to its theocracy.

Despite all of this, marketers and advertisers must be alert because anything Apple introduces to consumers has the potential to be a game-changer or at the very least, another opportunity to market to Apple’s faithful following.  The iPad will host the next generation of Apple-approved applications.  While the iPad has more processing power and memory than the iPhone, one might think that the next wave of apps will consequently be more robust.  The problem with that logic is that iPhone apps are either designed to be streamlined for the very limited capabilities of the iPhone, or for the mobile, location-aware attributes of the device.  Therefore it is difficult to imagine why a new catalog of iPad applications will be a game-changer.

If the iPad doesn’t sell an impressive number of devices, marketers and developers may dutifully build iPad apps for consumers who feel entitled by the explosion of them on the iPhone. The absence of a clear, de facto sense of purpose for the iPad among industry analysts has created confusion where excitement was expected.  Unless Apple can create a large customer base, marketers and advertisers will curb their enthusiasm, waiting for either another evolutionary step (such as a comparable Google product) or mass adoption of the device.

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by Craig Hordlow, Chief Strategist

With so much excitement about the iPhone amongst both businesses and consumers, as well as the vertical market share growth charted by the device (from 5 to 10% between 2008 and 2009), it’s puzzling to see a recent Gartner Inc. report predict that Google’s Android, currently at 2% market share, will leapfrog to 14.5% by 2012, making it the second-largest mobile platform at the great expense of the iPhone’s market share.                  

The Gartner report predicts that the iPhone’s growth will become stagnant, growing a few points to a whopping 12% by 2012.  Why such a slow-down for the iPhone? And what does this mean for marketers who are just now catching onto the surge of client interest and investment?

Most of the projected growth is attributed to Google’s own ability and efforts to promote the Android, as well as its own apps and the large number of manufacturers making the open source device, which will make it a cheaper option than the iPhone. Additionally, the iPhone, not being open source, has limitations, whereas an open platform allows developers to implement functionality the platform providers haven’t gotten around to yet, are not good at, or simply put: other people could do it better

What should marketers be doing?

• Follow Android’s market share growth and start talking to your clients or in-house teams about the emergence of Android so they are comfortable with the change if and when it happens
• Study the mobile apps already on Android, and what your competitors are doing on the platform
• Get your technical teams up to speed on Android by downloading the SDK:
  http://developer.android.com/guide/index.html
• Create your demo project long before anyone else does!

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by Beth Morgan, VP of Operations

Two recent related stories point to the continued flux in the mobile search market:

1. To the surprise of no one who has paid the least attention to the hype, the iPhone has increased its share of the US smartphone market quite rapidly for such a new entrant into the market. It is now the number 2 smartphone in the US, with a market share of 28% (compared to market leader RIMM/Blackberry with 41%). It also has a reasonably strong share of the global market; it comes in #3 with 6.5% (market leader Nokia has 53%). The iPhone is popular and its popularity is increasing; more importantly, the clamor over its user-friendly interface is having a big effect on overall smartphone design. And that brings us to:

2. Google has revealed that it gets 50 times the searches from the iPhone as from any other mobile device. That’s right, the iPhone represents a 98% share of Google’s mobile traffic. And since Google gets about twice as many mobile searches as Yahoo (according to an iCrossing report from May ‘07), that means that the iPhone is pretty much dominating mobile search. This is no surprise to anyone who has ever tried a search on an iPhone and on another smartphone; the iPhone’s intuitive interface makes searching easy, while with other phones you’ve got to really want that info.

Why are these two stories so important for influencing thought on mobile search? Because with the iPhone interface mobile search is really not separate from computer-based search. The search page you come to when you search Google on your iPhone looks like the same page you get on your computer; the ads are the same as well. There is no need to create special ads and landing pages, as there is with other interfaces. To me it appears the writing is on the wall in terms of the direction mobile search is going, and it is away from the separate ecosystem of mobile-only ads and landing pages. This very fact will only increase the iPhone’s dominance as sites stop investing in mobile-only design.

For marketers, this means that if you’ve been feeling vaguely panicked because you aren’t in mobile yet, you can relax– for once waiting was the right move. The market is coming to you.

As a P.S., Google’s own press release about the dominance of the iPhone in mobile search makes last week’s announcement about their new partnership with Nokia (a distant fourth in the US smartphone market) seem a little odd, to say the least.

This article is cross-posted on Beth’s blog.

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by Lauren Quan, Associate Marketing Manager

Guests who attended our recent NYC Open House party saw our first mobile marketing campaign in action. We set up a simple text messaging trivia game to test our guests’ knowledge of our New York-based clients for the chance to win an iPhone.

To start the game, guests text messaged the keyword “Applecado” to a predetermined short code. The contest, a series of five questions, was conducted entirely via automated text message. After receiving the first question, guests could text message their answers. They continued on in the game only if they got the previous question right.
Red Bricks Media’s mobile vendor tracked campaign data in real-time, keeping detailed statistics of phone numbers, dates, and times that messages were sent and received.

Red Bricks Media’s CEO Ed Kim predicts mobile marketing will become increasingly popular over the next few years. “Mobile marketing is a trend to watch in 2008,” he says. “A challenge for marketers has always been reaching consumers while they are on the go, and with mobile marketing you can bridge that gap.”

Although mobile is a new service offering for Red Bricks Media, mobile marketing strategy is similar to that of a current service line – email. “People may not realize that mobile marketing and email marketing are actually very similar,” explains Ed. “Both channels can be used to acquire new customers and market to in-house lists. More than half of our senior management team came from a background in email, and our experience will undoubtedly help shape our mobile strategy. ”

In addition to trivia-based campaigns, Red Bricks Media can set up more complicated campaigns including polls, voice and image messaging, and ringtone giveaways. Contact sales@redbricksmedia.com today and learn how you can use mobile to captivate your audience while they are on the go.

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We’re excited to announce that Edward Kim accepted the responsibility to assume the helm of Red Bricks Media. Ed had previously served as Vice President of Client Services and will be Red Bricks Media’s first CEO. As our co-founder and vice president of Sales and Marketing, Elliott Easterling, put it, “Ed has shown leadership in all aspects of the business, from client service to sales to human resources to operations. There is no aspect of the business that Ed has not touched.”

Ed has been a driving force in defining our vision for the future, and has served as a great motivator for our team. Ed’s long-term goal for Red Bricks Media is to become the industry leader in delivering creativity, performance, and client satisfaction. His short-term goals include expanding our work in emerging forms of media, applying our patented creativity and performance-driven analytics to channels like video, social networking, and mobile search.

Before joining Red Bricks Media in 2004, Ed served five years as Director of Sales and Services at the digital marketing agency Digital Impact (now Acxiom Digital), where he developed award-winning programs for Fortune 500 clients such as Apple, Microsoft, Intel, Wal-Mart, and Target. He also spent five years as a consultant and manager at PricewaterhouseCoopers.

Feel free to contact Ed and congratulate him on his promotion! He can be reached at ekim [at] redbricksmedia.com.

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by Elliott Easterling, VP of Marketing and Sales

Recently, I spoke at the Digital Hollywood conference regarding mobile search, an exciting emerging media channel. With mobile search, consumers can get personalized information anytime, anywhere. In no particular order, here are my top 6 trends in mobile search:

1) GPS/Location-Based Results

This type of search technology will allow you to search for a specific listing type (e.g. Pizza Restaurant) and then will return results based on your location. The many uses of information retrieval based on location will be a great service to people on the go. This technology could also add a whole new dimension to social relationships; for example, Google recently bought a company called Dodgeball.com that allows users to find friends or even dates based on their GPS locations.

2) Cell Cameras Acting as Barcode Scanners
In Japan, services like Mytago.com allow users to photograph special Mytago barcodes applied to products in-store using mobile phone cameras. Users can then retrieve information and promotions on that product at a later time at the Mytago website. Imagine the power of being able to easily scan any product in a store. You’ll no longer have to ask salespeople for product information, and you can get coupons and sales sent directly to you.

3) Search Integration with Mapping Applications
Search results mixed with mapping applications can really benefit people on the go. You’ll be able to find a restaurant or store and get directions based on your current location - all by using your phone.

4) Search and Real-Time Store Pricing
This involves taking search shopping engines such at Froogle or Shopping.com and then bringing them into a brick-and-mortar retail environment. Imagine walking into a store, finding a product you like and then querying a mobile application to get the lowest price online. This will empower consumers to negotiate down store prices – retailers beware, there may be dangerous waters ahead!

5) Voice Activated Search
Lets face it, when you are on the road, fidgeting with small cell phone buttons is unpleasant. In the future voice navigation will power many web browsers and search queries. What many people do not realize is that these services already exist. 1-800-FREE-411, for instance, offers free voice activated directory assistance. This service is the beginning of voice activated information retrieval.

6) SMS-Based Search
With SMS based search, you send a specific text message code to a search engine and are given back a result. These messages are sent to short code addresses such as “googl” for Google and “4info” for services like 4info.net. SMS search vendors provide an array of SMS information retrieval services. The table below shows the more powerful service features for 4info.

TYPE OF SEARCH: SAMPLE TEXT QUERY
———————————————–
Sports Scores: packers, nfl
Stock Quotes: ibm
WiFi Hotspots: wifi 94025
Weather: w 10001
Yellow Pages: sushi seattle
News: n nyc
Flight Status: swa 197
Movie Show Times: m 94025
Price Lookup: price xbox 360

What happens after you enter your query? How does the service work? As an example, if you send an SMS to 44636 (the numerical equivalent of 4info) with the message “ibm,” you will get a reply like:

International Business Machines Corporation
(IBM)
Last:97.20 +1.54(1.61%)
Hi:97.23
Lo:96.27
V:4,571,600

//Delayed Quote Data

Try sending one yourself and you will see the power of SMS based search. You should note that some cell providers have been blocking these types of services, so make sure that your provider allows them.

So those are my top 6 most exciting trends. I look forward to revisiting these in the future to see how these technologies fare.

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