Disruption Tour --- Run To Survive

Text And The City

I often toss and turn at night wide-awake contemplating when I will next get my hands on more quantitative research in the area of mobile marketing. Occasionally I bustle about in my own mental mobile marketing meanderings like Sarah Jessica Parker considering her romantic dilemmas on HBO’s Sex and The City.

http://www.mobilemarketingwatch.com/text-and-the-city/

And if you think I’m kidding, just ask my wife.

Needless to say, you can always expect a fair share of feedback from me when a company delves into the juicy results of their research in this realm - whether it’s massaged for their benefit or not. Either way, there’s always something to be learned.

According to Direct Marketing Association (DMA), the results of its first-ever “quantitative research effort in mobile marketing” are in. And as it turns out, the survey illustrated that text messaging is “by far the most often cited mobile marketing method-accounting for 70 percent of consumer mobile marketing responses-compared to a 41 percent response rate to surveys and a 30 percent response rate for email offers.”

The online survey conducted earlier this spring retrieved data from 800 mobile phone owners. 157 surveys were completed by respondents aged 15-20, and the remaining 643 surveys were completed by respondents aged 21 and older.

Internet Ad Spending to Outpace Direct Mail

 Worldwide spending on Internet advertising will total $65.2 billion in 2008 and represent nearly 10% of all ad spending, according to a new report from IDC.

This spending is projected to grow 15% to 20% annually by 2011 reaching $106.6 billion worldwide--accounting for 13.6% of total expenditures--eclipsing those of direct mail, the report noted.

“By the end of the forecast period, spending for Internet advertising will trail direct mail – the third largest form of advertising – by more than $30 billion, while spending on TV and print ads will each be nearly twice as great as for online ads,” said John Gantz, chief research officer at IDC, in a statement. “The long-term opportunity for Internet advertising can be seen in the disparity between per capita spending. Total advertising revenues equate to more than $105 per inhabitant of the planet, while Internet advertising revenues are less than $50 per active Internet user.”

The report also found that:

* Keyword ads will remain the dominant type of Internet advertising throughout the forecast period, capturing more than a third of annual online ad spending worldwide.

* Display ads will be the next largest type of Internet advertising, capturing more than 20% of worldwide spending annually through 2011.

Mobile Advertising: Still Waiting for a Medium

via CRM Daily on 5/6/08

Seen that great new ad on your mobile phone? No? Neither have we.

Maybe, if you are the texting type, you have responded to a promotion that asked you to send an SMS in order to enter a contest or receive information about a product.

Despite several years of escalating hype about the prospects for mobile advertising, the business remains in its infancy. Analysts say current spending totals around $1 billion annually, or around two-tenths of 1 percent of global outlays on advertising.

And it's debatable whether the activity that accounts for the bulk of that spending, text message campaigns, even qualifies as mobile advertising. That is because these campaigns typically employ advertising in other media, like billboards or newspapers, to encourage consumers to respond, rather than beaming ads directly to their phones.

Now that mobile television and other video services are being rolled out widely, advocates of mobile advertising are renewing their pitch -- that cell phones could be a highly effective medium, allowing marketers to reach consumers anytime, anywhere, on a device they love. Analysts, meanwhile, have been busy updating forecasts for the growth of mobile advertising.

EMarketer says overall mobile ad spending will rise to more than $19 billion by 2012. The Mobile Marketing Association, a trade group, says it should account for about 5 percent of ad spending worldwide by 2013. Given that the global ad market totals about $500 billion, that means about $25 billion would be allocated to cell phones.

Other forecasters are skeptical that mobile advertising will grow this quickly. Juniper Research said last month that spending would rise to $7.6 billion in 2013 from $1.3 billion this year.

Acquisition cost from Forester Research

This is 2007 data from Forester Research: Cost to acquire a customer

Banner Ads: $71.89
Paid Search: $26.75
Affiliate Programs: $17.47
Email: $6.53

Done right email is the most effective.

Where Is Ad Spending Headed?

emarketer.com 

Moderate growth is still growth.

The economic slowdown will eventually take its toll on total US media ad spending, but not in the immediate future. Spending increases in 2008 across all media will bounce back from last year’s flat growth to a 3.3% gain. Much of those increases will be in TV advertising, especially with the national election and the summer Olympics.

Even then, the retail, financial services and automotive industries, three large sectors for TV advertising, are already feeling the economic downturn. As Sarah Fay, the CEO of Aegis’s Carat, said in a recent interview with Advertising Age, “When there is a recession, marketers often feel the pressure to work with efficient forms of TV buying, so they are really starting to look hard at the Long Tail of TV or having cable play a bigger role.”

Need data for presentations? eMarketer subscribers can download charts instantly — over 50,000 choices. Request Info

Furthermore, ad spending cutbacks could be expected to trail the start of any full-blown recession for three related reasons:

1) Companies usually commit ad budgets in advance.

2) Companies do not want to slash advertising and decrease their sales until it is clear that consumer spending is going to be less responsive to advertising.

3) Companies are not likely to greatly alter their ad budgets until they feel the effects of decreased revenues.

However, the economic slowdown has been anticipated for many months. That has put a conservative slant on many ad budgets, which is why—even with elections and the Olympics—total ad spending growth this year will still be moderate.

 

Total US ad spending will approach $300 billion in 2009. By 2012, total US ad spending will soar past $330 billion, largely due to rapid increases in online ad spending.

 

Learn why online advertising is holding steady in uncertain economic times. Read eMarketer's US Online Advertising: Resilient in a Rough Economy report.

LinkedIn: We're Selling Ads For $75 CPM

LinkedIn may have been trampled by the likes of Facebook and MySpace in terms of users, but at least it can sell advertising. Kevin Eyres, LinkedIn's managing director for Europe, told IDG the social network for careerists is earning $75 CPMs (cost paid per thousand viewers) for advertising in the US and $50 CPMs in the U.K. Prime reason: the site's average user is 41 and makes $110,000.

Strong demand for mobile phones

http://news.bbc.co.uk/2/hi/business/7366650.stm

Demand for mobile phones was strong in Africa and Asia Global demand for mobile phones remains strong, despite economic uncertainty in rich nations and rising food prices in poorer countries. Consultancy firm Strategy Analytics says 282 million handsets were shipped worldwide in the first three months of 2008, up 14% from a year ago. The growth was driven by rising demand in markets such as Africa and Asia. Nokia maintained its dominant position with a 40.9% market share but shipments of LG and Samsung phones grew fastest. Motorola, Sony Ericsson and Apple lost market share in the quarter. "Motorola's 10% global market share is at the lowest level since our records began," Strategy Analytics said. "It is in real danger of being overtaken by LG." It said Motorola's handsets were "unexciting", while LG's "good looking" and "feature rich" handsets were popular amongst consumers. Handset market share Nokia 40.9% Samsung 16.4% Motorola 9.7% LG Electronics 8.6% Sony Ericsson 7.9% Others 16.4% Source: Strategy Analytics Demand for mobile phones was most brisk in emerging markets, particularly in Africa and Asia. It said that rocketing food prices in developing countries and the financial crisis affecting richer countries had so far had limited impact on demand for mobile handsets. Strategy Analytics forecasts demand will continue to rise, but at a slightly slower rate. It predicts 290 million handsets will be sold in the second quarter of this year, up 12% from the same period a year earlier.

US Teens Compose Constantly Online

emarketer.com
Nearly all teens are online. When do parents think teens should start using e-mail—and when should marketers approach them? Full Article

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Electronics Fine, Content Struggles
The devices on which US consumers play their media are selling better than ever. Too bad content sales are flat. Could marketing save the day? Full Article

Direct Mail Still Alive but E-Mail Growing, Says Report

Direct mail is not being replaced by e-mail marketing but the latter’s use is growing, according to Mintel Comperemedia, a media monitoring service. To learn more, click here directmag.com/news/direct-042408

$ Billion Wasted

$1 BILLION WASTED Even in the face of recession, spending on online advertising continues to soar. According to eMarketer, a research firm, this year’s spending will grow by 23 percent, to about $40 billion (emarketer.com). Search-related ads will continue to take the biggest chunk, but spending on display ads will also rise, by about 21 percent, to about $5.1 billion.

Nearly $1 billion of that will be “wasted,” though, according to Steve Rubel of the blog Micro Persuasion (micropersuasion.com). He based his conclusion on research by MarketingSherpa, which found that only 25 percent of Web users see display ads placed “below the fold” — meaning users would have to scroll down to see them. And that is where half of all display ads are placed (mediapost.com).

The situation amounts to “a train wreck waiting to happen,” Mr. Rubel wrote. “Advertisers are going to eventually wake up and recognize that unless it’s a highly visible placement, banners get you largely nowhere.”