Pros and Cons of Mobile Marketing

eMarketing emerged because of the Internet, and has marked a shift in the way that
companies invest their marketing and advertising budgets.
Not only has the Internet become a major channel, but the connectivity and
community aspects of the Internet have brought about a mind shift in the marketing
of savvy organisation. Mobile Marketing is shaking things up once again.
As a direct response medium with lowered costs, easy customisation and sophisticated tracking, even on a mass scale, mobile is proving to be an extremely profitable medium for advertisers and marketers.

7 Unique Benefits of Mobile
With direct response and relatively lower cost of communication, mobile is changing
the face of the marketing and advertising horizon. Tomi Ahonen (Ahonen, 2008) has
identified seven features unique to mobile phones, highlighting the unique benefits
and challenges of the mobile phone.

1. The mobile phone is personal.

A 2006 survey (“Wireless Works” by BBO and Proximity) found that 63% of
respondents would not share their phone with anyone (and 90% of those surveyed in
Japan would not share their phone). While laptops do present a personal connection
to the Internet, they are not as personal a device as the mobile phone.
The implication for marketers: Respect for privacy and permission is exceptionally
important in all aspects of marketing, and particularly so when it comes to mobile phones.

2. The mobile phone is always carried.
What do you take with you when you leave your house? Wallet, keys and mobile
phone. What do you keep always near you when you are in your house? Mobile phone.
According to 2007 research by Morgan Stanley, 91% of mobile phone owners keep
their phone within one metre, 24 hours a day. People have their phones with them at
all times of the day, even in the bathroom.
The implication for marketers: Messages sent to recipients can be read and acted on
immediately. Unlike, for example, email which requires that the recipient be in front of their computer and connected to the Internet, messages sent to mobile phones will most likely be accessed within minutes of being received.

3. The mobile phone is always on.
In order to fulfil its primary function – as a telephone – the mobile phone is always on. Messages and services can be sent and acted on at all times of the day.
The implication for marketers: Similar to the previous feature of the phone, the
fact that the phone is always on changes the services and messages that can
be developed for the phone. It also means that marketers need to be even more
sensitive with their marketing communications. Not many people would appreciate
an SMS at 4am informing them of a special offer.

4. The mobile phone has a built-in payment system.
This is perhaps the key feature of the mobile phone, and one reason why content
for mobile phones in many areas generates as much or more revenue than content for the Internet. Every mobile phone has a built in payment mechanism – the SIM card. Billing is easily handled through the user’s mobile network. Not only do mobile phones have this built-in payment mechanism, paying for content and downloads
has been built into the way that consumers use their phones. There is less of an
expectation that goods and services will be free.
There are also a number of services that turn the mobile into a virtual wallet or
bankcard, bringing banking and payment services to people all around the world.
iChannel, a mobile news ticker feed in Japan, generates US$ 192 million per year
in subscriptions for its US$ 2 a month service. It has more paying subscribers on
this single service that all online newspapers in the world combined (Moore, 2008).
Similar cases can be made for games, music and other mobile content.

The implication for marketers: Consumers are willing to pay for services and content on their mobile. Advertising is not the only way to generate revenue for content.

5. The mobile phone is available at the point of creative inspiration.
As the mobile phone is always carried and always on, it is always available as a
creative tool. Phones today feature a number of tools that let users act on creative impulse, from taking photos and videos, to becoming a scribbling pad on which to jot down ideas.
The implication for marketers: The feature can be used to encourage interactivity
within campaigns created for mobile. It presents the mobile as a useful tool in viral campaigns based on consumer generated content.

6. The mobile phone presents accurate audience measurement.
While the Internet is vastly superior to other media in its ability to track and measure advertising and marketing campaigns, it is eclipsed by the mobile phone. Every transaction made on a mobile phone can be uniquely tracked to that mobile phone number, whether the transaction be a voice call, an SMS message or accessing the Internet.
The implication for marketers: Aggregated data provides extensive profiling and
segmenting opportunities for targeting the right audience. Campaigns can also be
accurately measured and tracked for ROI. Bear in mind as well that this accurate
measurement means that mobile phone users have far less anonymity than Internet
users. Even though at least 50% of mobile phones worldwide are on a prepaid or pay-as-you-go type of contract (which means that the network operators do not have
the phone user’s name and demographic details to go with the mobile number), each transaction made by the phone user can still be measured. Be aware, that the networks determine the data that they are willing to share with the marketing
company. This limits the information available.

7. The mobile phone captures the social context of media consumption.
Because of the nature of the mobile phone to accurately track transactions to any
particular phone number (user), it can track transactions between mobile numbers
(users). This means that sophisticated data mining can identify patterns that indicate information and preferences of mobile phone users. Not only can alpha users be identified, but they may be identified within their social context.
The implication for marketers: This information will represent rich data that can be used to both create and market products, content and services online.

Advantages of Mobile Marketing:
The Benefits of the 7 Features
Instantaneous: Or, at least in principle. As the audience is likely to be carrying theirbmobile devices with them in a standby state, they are more likely to receive and absorb the message on the spot. Always around, always on.
According to comScore, Inc., a leader in analysis and commentary of the digital world, advertisements for restaurants and food boast the highest response rates of all SMS advertising. On average, 16% of those receiving an advert for a restaurant are likely to respond, while 13% of those receiving an offer for food – such as a grocery coupon – will show interest.
According to Nic Covey, Nielsen Mobile’s Director of Insights, Nielsen finds that 13% of mobile users both recall and respond to mobile ads, while 16% view the ads but do not respond.

In terms of methods of response:
25% of mobile ad respondents sent an SMS message
13% sent an MMS (picture SMS)
11% sent an email
9% visited a Web or mobile site
7% responded to click-to-call notes that: “Encouragingly, among those who did not recall or respond to mobile ads, only 10% cited privacy concerns as their reason for not responding. Just 2% said their data connection was too slow.”

Efficient: Creating content such as images or video for streamlined mobile devices is relatively inexpensive when compared to desktop or laptop systems which can handle content of the highest quality. The limitations of mobile devices such as screen sizes, data transfer rates and costs mean that content needs to be simple
when created for mobile.
This mobile efficiency is also great for promotions, issuing vouchers and other permission-based marketing and incentive services. Promotional codes and coupons can be relayed to the audience via mobile devices, allowing users to ‘carry’ around the virtual information and use at a convenient time.

Convenient: With a good idea in action, mobile campaigns can prove more convenient  than traditional media, as the content is kept down to a minimum and the platforms are adaptable on a mass scale.
Sharing: Like the desktop based Internet, mobile connectivity can make sharing information a breeze. Not only does Mobile Marketing have massive viral potential, but planning a campaign to go offline and then return online by using such multimedia devices such as 2D barcodes, Global Positioning System (GPS) or camera
capabilities, can attract others to get involved.
Broad: Potential for brand new audience who may not have much online experience, while specific target groups can be singled out. According to a report released by The Kelsey Group in February 2009, the number  of mobile Web users in the US is expected to grow by just over 40 million by 2013, clocking in at a whopping 95 million users. During this period, the number of mobile handsets in America is expected to grow by just under 25 million.
Consumer Relationship Management: As mobile technology is essentially the first mass-communication vehicle which relays messages directly to the individual wherever they are, there is an increase in relationship building potential. Mobile phones are private and relatively secure, allowing for a more personalised approach
to media. Marketers can receive feedback instantly, leading to a valuable two-way conversation with their audience members.
With reduced costs of broadcasting messages, regular updates on procedures such as insurance claim processing via SMS maintains customer contact and can reduce call centre volume.

Real Time Tracking: As with the traditional Web, tracking and reporting is easy, effective and instantaneous – if the network providers play ball, that is. Quicker response times lead to increased tracking potential and market understanding.  
Customisable Mass Communication: Mobile Marketing is often able to reach a wider audience due to the accessibility of mobile devices when compared to the number of those who have access to traditional, desktop-based Internet – especially in developing countries such as South Africa. There is often potential for device detection, geo-locating, location-based messaging (such as location specific and sales related broadcasting Bluetooth messages in shopping centre) and other handy tools for targeting.

Multimedia: Like PC based Internet, photos and videos are available, but it’s never been easier for users to create and share this content, provided that they have the latest phones. The ability to view this content is important to modern Mobile Marketing, but campaigns can also be centred on user generated multimedia content. Audience participation allows your campaign to grow exponentially, in content and influence.
Novel: The Mobile Marketing industry is not yet saturated with excessive promotions. Users and advertisers both still see value in Mobile Marketing.
Adaptable Integration: Mobile convenience makes it easy to cross platforms and promote other media sources by incorporating mobile elements into current campaigns. For example, Common Short Codes (CSCs) can be used in a TV or radio ad to get the public to enter a competition or request information. All they need do is text a specified keyword to the five digit number advertised. RSS (Really Simple Syndication) can be fed via SMS to your contact list, informing of news, specials or other valuable marketing information.

Microblogging platforms such as Twitter are another increasingly popular communication tool for marketers and consumers and have major benefits when incorporated into a mobile campaign. According to a Nielsen report published earlier
this year, in January 2009 735,000 unique visitors accessed Twitter via their mobile
device (out of a total, estimated at 6 million – via Twitterfacts).

Payment: Mobile devices have the potential to replace the physical wallet as it is a relatively secure payment device. This means the consumer doesn’t have to carry around wads of cold cash – but can pay via advanced mobile Web systems or even with basic USSD services (Unstructured Supplementary Service Data) or CSC
Direct, Personalised Marketing: By the time you’ve finished reading this sentence, a mobile user could have received a direct marketing message. As his or her device can be used as a virtual wallet, there is potential (especially in countries such as Japan where mobile payment systems are common) for a sale to be completed at the peak of interest.
In the UK, the mobile phone network Orange ran a successful campaign around movies. All Orange customers could go the movies for half price on a Wednesday. All they had to do was text the word MOVIE to a particular number, and in return they would receive a unique code with which to claim their discounted tickets.
In return, Orange then sent the list of prospects who requested discounts information about the movies being shown at their local cinema. How did Orange know which was the local cinema?
Simple: all they had to do was match the unique code to the number it was sent to and the cinema it was used at.
According to an article on Ixplora, the campaign provided up to 300 000 people with half price movie tickets every week, resulting in 3 million more punters in UK cinemas every year and making Wednesday the most popular week-day to visit the cinema.

Disadvantages of Mobile Marketing
Few Standards: Mobile phones are even less standard than PCs. Not only do phone models present a myriad of screen sizes, there are also several operating systems and browsers that are used by mobile phones.
Privacy and Permission: Privacy is always in question on any network or device. Savvy marketers must be aware of the connection that users feel with their mobile phone, and offer clear instructions for opting out of marketing communications.
Questionable Navigation: The mobile phone is small, and has a small screen and keypad. While some phones have a full QWERTY keypad, many have the standard numeric keypad. When it comes to the mobile web, consider that phones do not have a mouse and few models have touch screens. For the most part, navigation of the mobile web is through the keypad or scroll buttons on the phone - making mobile more of an objective based exercise for the user, rather than casual browsing.
Education: The use of more advanced features of phones can require an extensive education process. While mobile phones have a host of features, these devices are for the most part under-used.