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Advertising on mobile TV – plenty to be optimistic about

Advertising on mobile TV – plenty to be optimistic about

By Kamil Grajski, President of the FLO Forum.
                                                                                     
Despite being one of the most hyped sectors of the mobile industry, mobile advertising is still in an experimental phase. Marketing and advertising driven by messaging – that is, SMS and MMS traffic – still make up the bulk of content.

Rich media advertising (video, mobile web and broadcast) is growing steadily, but at present still only accounts for a small percentage of the overall mobile advertising market.

On the other hand, despite the small audience for existing mobile TV services, subscribers are responding well to advertising delivered via mobile TV – be this via broadcast or 3G networks.

Orange UK has found that mobile TV exceeds all other forms of digital advertising during peak viewing hours, between 12 and 6pm. This gives credence to the belief that the more interesting and engaging the advertising medium, the better the response rate.

Certainly, advertisers continue to see broadcast as the most effective way of reaching a broad and diverse audience. But while conventional broadcasting technologies have been with us for well over half a century, broadcast TV on mobile is still in its infancy and still has some hurdles to navigate before it can sit comfortably alongside its older sibling.

What’s clear is the consensus that mobile TV and in turn advertising on mobile TV is a case of ‘when’, not ‘if’.

Recent figures from analyst houses Juniper and Screen Digest support this view. Screen Digest’s report 'Mobile media advertising opportunities: The market for advertising on TV, video, and games’ (published April 2008) predicts that the market for rich media advertising on mobile - collectively TV, video, games, user-generated content (UGC) and music—will reach $2.79 billion by 2012.

The bulk of this will come from mobile TV advertising, which it expects to hit $2.44 billion globally by that time. To put it into context, that figure equates to over 20 per cent of total forecasted global mobile TV revenues.

The unique attraction of mobile TV is the opportunity to balance the reach of broadcast with the specific targeting possible with mobile. That’s one of the reasons why predictions for advertising via mobile TV are comparatively high, at over a third of the total mobile advertising spend by 2012.

The ability to deliver advertising in complementary ways – rather than the interruption mechanism of SMS and MMS – is fundamental to the effectiveness of this emerging format. Advertisers can already create campaigns which use dynamic ad insertion into live streams, click-to-call mechanisms and targeted ad delivery.

Mobile TV is a brave new world where media and technology combine. For creative agencies, mobile TV is part of the new digital mix which is transforming the advertising landscape. Forward-thinking agencies like AKQA, Publicis, Ogilvy and Starcom are ensuring that they have the capabilities to deliver mobile TV campaigns when the time is right.

But for now, major brands are still not committing significant money to mobile advertising largely because they’re yet to be fully convinced of the efficacy of the channel.

Where brands have already committed to mobile advertising, however, the success of the channel is showing its potential: Chris Barbour, responsible for global digital marketing at Adidas, said the brand's global spend on mobile advertising will increase by 10 per cent in 2009 because of the positive contribution mobile is making to its global campaigns.

Of course, once you have adverts to run and viewers to see them, you also need ways of measuring the effectiveness of advertising over mobile TV. Metrics and measurement are an essential part of the jigsaw, without effective measurement it is impossible to set realistic pricing.

One of the benefits of mobile as a platform is that every device is in theory linked to a unique viewer, so at a technological level it’s relatively simple to measure audience size.

Audience measurement is essential to market players as a tool to understand consumer behavior and industry organisations such as the bmcoforum are actively working to develop guidelines and standards to enhance and improve metrics.

However, measuring engagement is a different challenge; the basic CPM metrics of web advertising are too blunt an instrument for mobile TV as the advertising ‘experience’ is so much richer.

Screen Digest warns that without its own metrics mobile TV “will struggle to be considered a standalone advertising channel”. The chance of this happening is remote, as there has already been significant effort by industry bodies including the Mobile Marketing Association (MMA) and NAB FASTROAD (Flexible Advanced Services for Television & Radio On All Devices) to define guidelines and standards which will give all players in the mobile TV ecosystem the boundaries they require.

As it stands today, advertising on mobile TV is still finding its feet. Setbacks like the current global advertising downturn mean that in the short term, companies are concentrating on the tried and tested methods, reigning in their spending on new platforms.

But in the long term, it’s hard to find too many people who don’t think mobile TV will become a very powerful advertising medium. The question is – who will be there first to reap the rewards.

 

AJR

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