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Why 2014 won't be the year of mobile advertising

It's been the year of mobile every year since 2008, but recent reports suggest we've finally made it.

Mobile: the best marketing platform the world has ever known says Tom Goodwin

Mobile: the best marketing platform the world has ever known says Tom Goodwin

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According to a recent WSJ report, smartphones and tablet advertising have, in less than ten years, become a bigger channel than the centuries-old newspaper industry or the nearly century-old radio sector.

How quickly things – that we’ve been expecting for ages – happen. But, while the first steps of mobile advertising may have been tentative, the future looks explosive, with eMarketer predicting a 90 per cent rise in mobile adspend during 2014.

The longer-term future looks even more abundant, with mobile becoming the second-largest media channel in the UK by 2016, driven by an annual advertising spend of a whopping £4.23bn, a rise of £3.2bn over 2013.

Google, the king on online monetisation, accounting for more than half of all mobile ad spend struggles with deflationary costs per click.

Where would it all go? Spending £4.23 billion on mobile would be like being tasked with spending a billionaire's fortune in a pound store – there is not enough to buy and it’s too cheap. 

Facebook: the darling of the digital world, where we spend more time than on any other app, and a company that famously now makes more money from mobile than desktop, and takes more than a quarter of the mobile advertising pie, but still makes a paltry £3 per user per year on mobile.

Google: the king of online monetisation, accounting for more than half of all mobile ad spend, struggles with deflationary costs per click.

So where does all this new money go? Are a lot more people going to spend time on mobile? Are we going to allow ever more ads? Larger more expensive ads? A lot more searches? A little of each, but this doesn’t account for a quadrupling in ad money from 2013. Perhaps ads will get more expensive.

Mobile advertising isn’t working. Mobile ads have hovered around £2 CPMs for a long time, the equilibrium maintained by greater demand, but ever-increasing inventory, and undermined by poor performance -- the mere inconvenience that the ads demonstrably don’t work.

Mobile has migrated from banner ads that once worked, to native ad units, click-to-download ads and in-feed ads, all desperate and temporary successes in keeping clicks at acceptably low levels. This innovation creates the mirage of success, but what happens when we get bored again?

Media agencies have long made the lazy assumption that media spend should correlate with time, but they’ve thought only in terms of channel planning, but never context. The context of mobile phones is a combination we’ve never seen before: a highly personal, ultra lean-forward, omnipresent channel, present at every point of purchase, but also when we are busiest, least open to interruption and hampered by a tiny screen.

For most brands, at most times, for most offerings, it’s a terrible place to advertisebut it’s the best marketing platform the world has ever known. Mobile like "digital" has been digested the wrong way, with our production mentality towards advertising. It’s not a new vessel to fill at the end of the factory, and it’s not a new production line in the factory – it’s an entirely new way to do add value in the space between people and brands. 

Our phones are our address books, our diaries, our photo albums, our maps, our wallets, our shopfronts and connections to our friends. To think of it as place to buy media is to miss everything.

We need a move to mobile-centric thinking, where brands transform themselves for the mobile age, where they reimagine every consumer touchpoint based on what mobile can do for that moment.

The tools of this age are not the banner ad, the auto play mobile pre-roll, the Instagram print ad – they are so much more. The new toolkit is in mobile wallets, mobile coupons and mobile ticketing. It’s in mobile-centric business and the uber-ification of every industry. It’s in mobile-enabled commerce and omnichannel shopping. It’s about providing new value through useful apps or mobile content. 

This year won’t be the year of mobile advertising – it will be the start of mobile transformation.

Tom Goodwin is the director of the Tomorrow Group

This article was first published on campaignlive.co.uk

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