Brand managers are taking mobile a lot more seriously than they were in 2007, and repeat business indicates they are getting a solid ROI.

The emergence of the mobile phone as the seventh mass medium is hardly a surprise.

It has been anticipated for at least the last decade but the use of cellphones for activities other than the making of calls and sending of text messages only really reached a tipping point in 2006 and today has already established a critical mass of early majority usage.

In South Africa, with its two economies, approximately five million higher LSM consumers have internet access either at home or at work (mostly at work) but over 25% of South African cellphone users access the mobile internet on a regular basis (NSN Pulse study, October 2007) and more than 75% of these do not have easy access to the fixed internet (Vodafone live! UVAL study June 2008).

The centrality of the cellphone in the lives of over 3.3-billion (Informa, November 2007) consumers across the globe (1% of which live in South Africa) and the empowering nature of mobile for millions of developing market consumers for access to loved ones, business contacts and information, is beyond dispute.

Measuring mobile marketing

Mobile has become a powerful advertising and marketing medium. For brands, advertising agencies, publishers and network operators already seriously engaged in developing or using mobile media, the evidence is very compelling but it tends to be rather proprietary and fragmented; the establishment of an objective and independent measurement currency has always been key to the eventual mass adoption of any new advertising medium and mobile is no different.

Vodacom has taken a leading role in developing and evangelising the mobile medium, not only in South Africa but also globally (www.on-the-line.co.za). Here are some general facts both from the Vodacom business as well as from the local industry

  • According to the DMA, almost half of the annual investment in direct marketing in South Africa is going into mobile (SMS and MMS mainly for customer relationship management activities)
  • Well over one billion rate carded mobile advertising impressions are served to South Africans every month via the large local publishers (Vodacom and Mxit) and the international advertising networks like Admob, Google and Buzz City (MyGamma)
  • Spend on rate carded mobile advertising is already at least as large as the measured (Nielsen) spend in online, and will overtake online before the end of 2008
  • On Vodacom’s Mobile Internet properties (WAP banners) click through rates average 2.5% which is between 10 – 25 times higher than the typical 0.1% – 0.2% click through rates for online banners
  • Since launch of its mobile media business in October 2007, Vodacom has run campaigns across all its inventory categories for more than 65 brands of which more than 80% have run more than one campaign
  • Vodacom mobile advertising business unit revenue contributed by advertising agencies (as opposed to brand spend directly) has increased from around 18% in October 2007 to over 55% in July 2008

There is no doubt that agencies and brand managers are taking mobile a lot more seriously than they were in 2007 and the repeat business in evidence both in Vodacom’s media and in other mobile media locally, would seem to suggest the early adopters are getting a solid ROI.

Full integration

However, the availability of a new media option does not change the advertising fundamentals and media planners need to ask all the same questions about communication objective, target segment, reach, etc. which they have always asked.

This thinking should be done at the early planning stages however to ensure that mobile (if appropriate) is fully integrated into the overall campaign.

At the moment the majority of investment into mobile is for campaigns with a direct response objective – probably because the measurement of response and therefore measurement of ROI is so precise.

The financial services industry is investing heavily in mobile for this reason and in some product categories mobile media has become the largest source of new business of any media in use. In addition, marketers from brands like Coke, Nike, Nokia, Toyota, the Unilever stable and many others, are investing in mobile with a classical branding objective and these brands are reaping a rich early adopter dividend on the still fairly uncluttered small screen.

Fourth screen for some, first screen for most

Considering that for millions of consumers in developing markets like South Africa, the cellphone screen is in fact the ‘first screen’ and not the ‘fourth screen’ (after TV, cinema and personal computer) as it is for more affluent consumers, it is surprising that more agencies have not yet made an effort to get their brand clients into mobile in a more aggressive fashion.

The large disparity between the reach of mobile (the only interactive mass medium in developing economies) and the low percentage of budget currently allocated to mobile, creates an obvious opportunity for savvy South African marketers and media buyers.

Mobile is already an integral part of the marketing mix and its influence will continue to grow, marketers need to start making significant experimental investments in mobile media if they are not already doing so.

This article originally appeared on MarketingWeb 1 October 2008