Are Mobile Ads Finally Growing Up?

Advertising Relearned for Mobile (New York Times)

Mobile advertising has long been considered a weakling when compared to website advertising.  One study by eMarketer estimates mobile advertising revenue for 2012 will be about $2.6 billion, which is hardly a blip on the overall advertising radar screen that totals hundreds of billions of dollars.  Considering that there are now hundreds of millions of cellphones, with a large percentage of these being smartphones, it seems a little surprising that advertisers are not more aggressive in embracing mobile as an advertising platform.

Of course, from the advertiser’s perspective the key justification for not spending more has been the screen size issue – ads just appear too small for someone to see.  Some have also argued that mobile users are much less likely to use their device to browse websites and instead limit the use of phones for specialized apps and phone calls.

But, it appears we are entering a transition stage for mobile communication.  The definition of a mobile device is evolving to include at least three categories – smartphones, small tablet devices and large tablet devices.  In fact, Google’s announcement of new products for all these platforms should be a clear signal to advertisers that mobile advertising is much more than ads presented on cellphones.

As discussed in this story, marketers are seeing the light when it comes to mobile advertising.  Besides understanding what qualifies as a mobile device, marketers are gaining a better understanding of how to effectively use mobile advertising.  For instance, marketers are now understanding how to enhance their ads with technologies built into these devices including ads tailored to utilize such built-in technologies as maps, geo-locators and, of course, the ability to make a call.  Advertisers are also discovering that mobile customers may be further along in the buying process than someone who is using a computer.  Consequently, using technologies that help customers purchase faster, such as a “call now” button option or providing a nearby purchase location on a map, are being embraced by advertisers.

A big challenge for the tech companies is that advertisers pay less for mobile ads than for those online, largely because consumers are less likely to make a purchase on their phones. Though people click on mobile ads more than on desktop ads, advertisers wonder whether that is because of what they call the “fat finger effect” — accidental clicks on tiny touch screens.

Is the interest in mobile advertising simply due to its “newness” or will these offer real value in the long-term?

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