Companies moving to mobile advertising campaigns, budgets

Next year is expected to be a big one for mobile advertising as companies set aside budgets and plan mobile advertising campaigns, industry insiders say. “Mobile is no longer that test or that experimental phase in a campaign. It’s now become the real thing. It’s arrived. Clients are really trying to build out robust, mobile-optimized strategies,” Deepak Anand, an account representative at Google Inc.’s Toronto office who also worked on Google’s mobile business, said in an interview. “They’re looking at ad campaigns with formats and targeting that make sense for mobile. They’re looking at what, exactly, we want to offer someone who is mobile, and then figure out the best way to do that.” Andrew Osis, CEO of Calgary company Poynt Corp., which developed the advertising-supported Poynt search app for smart phones, said in an interview that his advertising clients have shifted from “mobile is interesting” to setting aside budgets for mobile campaigns. Osis said mobile is attractive to advertisers because it is pervasive, adding that mobile devices now outnumber televisions, computers, or radios. Mobile advertising, he said, is also personal. “My mobile device? You’re going to have to pry it out of my cold, dead hands. It’s mine. My kids don’t touch it. My wife doesn’t touch it,” he said. “You send advertising to that device, you’re sending advertising to me.” Poynt’s search application combines the user’s location with the terms of the search query to generate targeted ads. “It’s the most highly-targeted advertising that money can buy, basically,” Osis said. “I know where you are, so I can find the closest to you. I also know when you are, so I know the time of day.” The successful Poynt app is available on iPhone and Android phones in Canada, the U.S., and Europe, and as of Sept. 30, 2010, had a user base of 3,913,728. Anand said the top “fortune 50” advertisers in Canada are now moving to mobile, either figuring out how to translate existing desktop advertising experiences to the medium or looking at it as a new opportunity to innovate. Apple Inc. waded deeper into mobile advertising this year when it bought the Quattro Wireless ad network, but in August Apple announced it was winding down Quattro as a separate network. Apple CEO Steve Jobs said at the time the company’s focus is not to earn ad revenues. Apple said it will instead use Quattro to support Apple’s iAd advertising platform. The iAd platform allows developers to place ads on applications for the iPhone, iPod Touch, and iPad. In November 2009, Google announced the acquisition of AdMob for $750 million US. The acquisition closed last May. AdMob provides advertising optimization technology, such as targeting and tracking, for more than 15,000 mobile websites and applications. Anand said many advertisers join both the AdMob and Google networks, but acknowledged the two are increasingly becoming “the Google-AdMob network.” Anand said AdMob is helping Google move to new mobile advertising formats, like click-to-maps, click-to-call, or click-to-canvas. Click-to-call allows advertisers to include phone numbers directly in their ad text, which users can click on to call the business. Click-to-Google map is a new advertising format that allows Google to place several locations on a mobile map search for a business or directions, Anand said. Click-to-canvas opens a pop-up ad—such as game or a form—on top of an app running on a mobile device. A gaming app, for example, could have a click-to-canvas function that opens a similar game advertisement. “They are bringing a very established ad network of both mobile sites and mobile apps, but also some amazing ad formats, way beyond just an image or click-to-video,” Anand said of AdMob. “ allows people to say, ‘We know they’re in this branded experience, whether it be an app or a mobile site. So let’s try to take advantage of that.’ If they’re playing a game, let’s put a video or a mini-game in front of them. If they’re reading the news, let’s put something informative in front of them.” Osis said he doesn’t believe in “a silver bullet” solution to mobile advertising. He said search will not be the only vehicle for mobile advertising, and suggested that gaming and app advertising will take off. Anand agreed, pointing to the click-to-app ad format that Google offers on the iPhone and is now launching with Android phones. “You have someone, for example, reading the news, and they’re reading about a car company. You could actually have that car company deliver an app right within the mobile site, and they can sell it right there,” Anand said. He said advertising on social networking and other niche mobile apps also provide opportunities for targeted advertising. A “beauty helper” app, for example, could have a L’Oreal ad in it; or a recipe app could include recipe advertisements from food companies. “For at least a year now, I haven’t heard anyone disagree that this is going to be a huge advertising medium,” Bob Reaume, vice-president of policy and research at the Association of Canadian Advertisers, said in an interview. “Like the early days of Internet video, some clients have been experimenting with this for some time now.” Reaume said that although Canadian advertisers are moving into the mobile space, “there are a little more advanced clients in the United States than there are here.” Although mobile’s targeted ads are attractive to advertisers, in Canada, under the Personal Information Protection and Electronic Documents Act (PIPEDA), companies must receive permission from smart phone users before using personal information for advertising purposes. Anand said Canada is typically a year or two behind the U.S. in technology adoption, but said that gap is narrowing for mobile advertising. “It’s more like one-to-two years. It’s becoming more of a global phenomenon. Everyone will grow at the same time,” he said. Osis added that he supports amending section 19.1 of the Income Tax Act so that the Canadian broadcasting advertising tax credit is extended to Canadian-owned digital media companies. “We don’t support Canadian business nearly enough with those kinds of initiatives,” Osis said. sdoyle@thewirereport.ca

Companies moving to mobile advertising campaigns, budgets

Broadcast | December 20, 2010

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