Digital Mobile: Search still on hold

Vodafone and T-Mobile have both signed up Google as their mobile search
provider in the UK and in June, 3 did a deal with Yahoo! to provide its
customers with access to a number of its portal-focused services via
mobile, including search.

But is mobile search's future really so rosy? Industry insiders have
speculated that Vodafone may already be getting cold feet and is looking
for an early way out from its multimillion-pound deal with Google, which
is just a few months old.

However, the mobile giant is sticking to its guns. 'We're seeing strong
interest from suppliers of mobile content - ringtone companies, for
example - as they see mobile search through Vodafone as a powerful
distribution channel,' says a spokesman.

Offering search functionality on a mobile phone makes sense. It enables
media companies and content owners to reach consumers on an individual
basis via a powerful medium. For this reason, it has proved most popular
with media brands and companies selling games, screensavers and
ringtones.

Brands can sponsor text links, bid for keywords, and also use tools such
as pay per call, whereby people use a text link sent by directory
services such as 118 118 or Yell.com to call a company. The latter then
pays the search provider for the lead and for the call, so there is no
cost to the consumer.

Analysts at The Kelsey Group have predicted the global pay-per-call
market will grow to between £740m and £2.1bn by 2009.

This burgeoning mobile category was given a further boost in March, when
118 118 signed a first-of-its-kind deal with search engine Miva (see
box). It sold space to Miva's clients on texts it sends to consumers
when they ring to request a number. So, if a consumer rang to get the
number for British Airways to ask about flights, 118 118 sent BA's
number and, at the bottom of the text, a number for American Airlines,
which had paid to advertise on such queries.

Perhaps one of the most significant potential benefits of mobile search
is localisation. Consumers can receive search results relevant to where
they are at that moment. For example, if they were in London's W1 at
lunchtime, they could search for local restaurants.

Brands can also arrange for promotional coupons to be sent to people
based on their search results, although take-up is still at an early
stage. 'If I'm searching for something that would be relevant to going
out for lunch, I could get a money-off coupon from a nearby Starbucks in
an area I'm searching,' explains Jens Anderson, managing director of
mobile search company Mobile People.

Crucially, mobile search is more time-sensitive than its web sibling.
When people use it, they tend to be out and about and in need of
immediate information, so the probability of lead conversion is
higher.

Slow adoption

Yet mobile search is generating more press interest than use. According
to Jim Bridgen, managing director of online search specialist The Search
Works, it's 'easy to get onto a mobile search platform, but the volume
(of response) is always disappointing'.

Although half of European users have handsets with colour screens and a
third can access the internet, according to Forrester Research, the
majority of consumers still do not use their phones for web access.
'Roughly a quarter to a third of regular mobile users who browse have a
search session,' says Thomas Husson, a mobile analyst at Jupiter
Research - not the ringing endorsement brands will be looking for before
investing.

Moreover, although search has been billed by the operators as providing
a vital gateway for consumers to content and brands, not many companies
are yet jumping on the bandwagon in the way they are online.

Craig Patton, European managing director of Omnicom-backed mobile
marketing agency Ipsh, believes a change in mindset is needed before
mobile search can reach a level where it makes sense to take the plunge
commercially. 'I don't think consumers at this stage consider the mobile
device as a search vehicle - there's still a lot of education to be done
on this,' he says.

There is also a problem with handsets. Typing search queries using a
phone keypad is fiddly, the screens are small, and the download times
can be long. But Mitch Lazar, vice-president of business development at
Yahoo!, insists that, although the small screen 'is a challenge', it can
be overcome 'through technology and relevance'.

'If you have partners that know about the consumer, you can tie that
information in to offer more detailed answers to queries,' he adds. He
claims that Yahoo!'s search service now being offered through 3 has
witnessed significant demand.

Nevertheless, a dearth of reliable mobile search functionality means
potential users are being put off using the facility, according to Mike
Beeston, managing director of technology and marketing company Fjord.
'There is no understanding of the universe of content I am searching,
nor does the engine sufficiently filter content that's formatted for
mobiles - it's too much of a shotgun approach, like the web,' he
says.

Issues of web-page functionality on the mobile platform also threaten to
hold back the growth of search; when users click through from a text
link, more often than not the web page they are accessing has not been
designed to be viewed via a mobile.

Jim Holden, Google's director of wireless strategic partnerships, admits
mobile-specific content is rare but says Google is addressing this. 'We
have a mobile search that delivers purely mobile content to our users,
but we also deliver trans-coded content that repurposes web content for
the mobile.'

Moreover, as the.mobi domain suffix is now being made available, brands
such as BMW are using it for mobile-only sites.

Nevertheless, with consumers being put off mobile search by lack of
content, reliability issues and poor search engines, it is little wonder
that brands have so far been reluctant to take the medium seriously.
Until better services are developed, the volume of consumers will not be
sufficient to attract investment in the medium.

Discouragingly, too, from the mobile networks' point of view, no model
has emerged as to how revenue can be generated from search - which is
why their approach has been fairly tentative and experimental.

Although some mobile searches stay within a network provider's portal,
most go beyond it to search for content. So, for example, by using
Google via Vodafone, Vodafone is just the channel, and the Vodafone
brand disappears once a user goes into the search function. This
presents a problem for the operators, which are keen to keep the
consumer within their own-branded environment for as long as
possible.

There are ways around this, however. Myriad companies such as Infospace,
Jumptap and Mobile People make white-label mobile search solutions that
can be branded by the network provider, so the user is still in a
branded network environment, at least while they're searching.

Despite the initially slow uptake, Yahoo!'s Lazar is optimistic about
mobile search's potential. He says that not only will it improve users'
options, it also stands to become a substantial revenue stream for
operators, especially as technology improves and the 'web 2.0
experience' extends to mobiles.

There have been some bullish predictions for growth of mobile search,
and a recent study by the Mobile Marketing Association in the US showed
that awareness is growing: 31% of respondents used the facility for the
first time in the past month, while current users conducted an average
of nine searches in the same period.

While the potential of the medium is clear, at the moment, that is all
it is. The much-hyped operator-and-engine deals have so far failed to
pay off, and the industry faces an uphill task to persuade both
consumers and advertisers that there is a role for search engines on
mobile phones.

CASE STUDY - ADMIRAL INSURANCE

Admiral, which provides insurance for younger drivers, had three
objectives for its mobile search initiative: to increase the volume of
enquiries to its call centre, raise brand awareness among consumers
interested in buying car insurance, and promote its new MultiCar
insurance policy, which offers lower premiums for customers who insure
more than one car with the same policy.

Admiral booked a two-week campaign with Miva through its media agency,
Steak Media. The technology delivered different ad executions via SMS
depending on whether consumers requested Admiral's own number, or the
number of other companies in the motor-insurance industry.

If Admiral's own number was requested, an execution introducing the
MultiCar policy was delivered, along with Admiral's contact details.

If the number of a rival company in the motor-insurance market was
requested, an execution carrying a call to action and a freephone number
for Admiral appeared beneath the requested number. In the second week, a
discount was added to this execution.

Admiral used discrete freephone numbers to track the effects of the
campaign. It found that 9290 SMS were delivered, and 3.9% of consumers
who received it went on to phone Admiral. The number of callers going
from call to final quote rose by half when the discount was added.