By Randy Wootton, CEO
There’s an old joke about a “lush” stumbling under a streetlamp, looking for his keys. A passerby asks the man where he last saw the keys. “Over there,” the drunkard says, pointing to the bar down the block. The man says, “If you lost your keys there, why are you looking here?” “Because this is where the light is,” he says.
Having been around this industry for a while, I’ve seen us focus on “where the light is” many times. And today the light is shining brightly on Mobile.
eMarketer published their robust “Need to Know Trends in US Digital Advertising” in March and highlighted the importance of mobile to the future of digital advertising efforts. Last year, Venture Beat reported on the “explosive” growth of mobile video, BI declared mobile to be the “fastest-growing advertising channel” for the foreseeable future, and an earlier report from eMarketer declared that mobile advertising is no longer experimental, but one of the most significant channels for advertising.
I would actually argue that the light has been shining on mobile for some time. In fact, when I started at Avenue A in 2000, my first job was the “wireless” technologies product manager. Yes, that is what we called mobile back then. We thought it was the year of mobile every year since! (To put this in perspective, total digital ad spend was only $8B in the US and we were also talking about how long it would take to get to $20B.)
But mobile being big and getting bigger isn’t the whole story. eMarketer cites a ComScore and Opera Mediaworks study about mobile native video ads, showing a 5% increase in purchase intent, a 4% boost in favorability, and no change in aided awareness. These numbers aren’t hugely impressive. They show the needle moving in the right direction, but for an ad channel as hyped as mobile, the results ought to look better.
In no way do I want to suggest that mobile isn’t a rich opportunity, nor that it’s not one of the most important ways to reach consumers. At Rocket Fuel, we’re investing heavily in our ability to deliver mobile engagements, as are many others. But we have a slightly different view on how to do this, and as a result, a slightly different way of talking about mobile.
Interestingly, that eMarketer report notes that despite the explosive growth of mobile ad spending – even in key brand categories like mobile video – advertisers don’t think they’re spending that much in the channel. In fact, mobile ad budgets range from 12% at the high end, to a paltry rounding error of 3% at the lower end. We have a situation where two-thirds of digital dollars will be spent on mobile ads, and yet, on average, less than 10% of budgets are actually allotted to mobile. How can we explain this?
Basically, that difference in reporting has more to do with where the light is shining. An awful lot of ads appear on mobile that might properly be classified as social or video or display or search, but they happen to be served on mobile devices. But because mobile is the hot property, many companies focus in on reporting out their mobile growth when they have the option to label those same formats in different ways.
Dillon Baker, at Contently.com, comments that while the research supporting mobile ad effectiveness on its own isn’t particularly robust, “it’s where the user is going—and where the user goes, the advertiser follows.” The thing is, the user hasn’t really gone anywhere. The idea of going somewhere implies that they have left somewhere else, and the data doesn’t actually support that claim. Consumers still exist in an ecosystem of desktops, televisions, radio signals, billboards and all manners of other signage. They’re social. They watch videos. They play games—sometimes on consoles, sometimes on PCs, sometimes on tablets, sometimes on their phone.
There’s nothing inherently wrong with correlating channel reporting to consumer activity, but it highlights a limitation in how the industry thinks about mobile, and it doesn’t reflect the longer term reality of what mobile means for marketing.
In many ways, the most important part of mobile isn’t about reaching one channel, it is about the opportunity to create meaningful experiences between brands and consumers across devices. Of course, this presupposes a marketer can stitch together cookies and device IDs into anonymous unified profiles. Because people have their phones with them all the time, seeking out nearby Wi-Fi signals or responding to beacon queries, mobile devices can tie together the consumer journey as it moves between online and offline decisions.
And because “always on” mobile devices provide a wealth of data, they help us understand when and how to engage particular consumers throughout their day: not just on mobile devices, but across any digital touchpoint.
In many ways, I believe what we refer to as mobile is really just one step towards a comprehensive, full-funnel, cross-device solution. To get there, we need to bemarketing to people, not their devices.
Our own cross-device research shows a 31% increases in conversions relative to “single” channel ads. But we’ve found that this lift doesn’t happen because consumers see more ads on more devices. Instead, our moment scoring technology collates user data from many touchpoints continuously, updates our anonymous profiles and then helps marketers choose which moments are the most important to engage with a consumer in real time. The trick is knowing when and where to act for each individual versus spraying and praying.
Mobile makes all of that possible, and it’s a key channel for engagement, but that doesn’t necessarily suggest that we should think of mobile ads as a mobile success story. If we do this, we’re still looking under that one streetlamp while ignoring the rest of the street. As marketers shift to a view that is cross-device and full-funnel, we’ll see less explosive and less exciting channel growth, but we’ll see more significant results. I call this outcome-based marketing, and it’s where the industry is going, as brands demand more return on their ad spend.
The question now, for martech, is if we’re ready—because when we can see and report out on the full marketing effort, and brands come to expect that level of detail and performance, it’s going to be a lot more difficult to hype any ad format or channel if the entire ecosystem isn’t delivering the results that matter.