In general, mobile marketing agencies’ stage of development reminds me of Telephia, a San Francisco-based market intelligence startup dedicated to the wireless industry which I joined in 2000, and which is now part of Nielsen’s telecom practice.    It was faced with similar challenges as mobile marketing agencies are facing today.

Of course, planning and executing multi-channel marketing campaigns is different than producing syndicated business intelligence, but there are some significant common threads:

1.  The industry was young, there was little competition, and what competition there was was small and fragmented.

2.  Telephia was a young startup that had to build its client base from scratch by proving its value to clients.  It was not even two years old with about 80 employees and no major clients.

3.  The ability to advise clients, offer insights, think strategically, and turn large amounts of data into actionable intelligence were a core success factor for its business.

Its product was a broad array of syndicated research built on a very large amount of data about U.S. wireless carriers and their customers collected 24/7.  The company was structured mainly into traditional silos of sales, account management, and product management/development teams.  But as the data streams grew and more capabilities presentations were made, senior management realized that the wireless carriers needed more than just data points and explanations of the underlying platform and data-collection methodologies.  Before they would even consider commiting multi-million-dollar budgets to this data and integrate it into their business processes, they needed to be shown how they could use this it to answer specific questions that will positively impact their business.

Telephia’s management quickly realized that it needed to strengthen an additional skill set to drive sales, analytics.  Although it would help drive sales, analytics clearly is an area in which sales executives don’t have the training, time or desire to take on.  Their job was to open doors and bring in new business.  Account managers had full plates dealing with client questions related to contracts, product features, and other such issues.  Product management/development, of course, were deep into the underlying technologies, platforms, and product road maps with no time to actually pour over the data itself, let alone stay on top of consumer and industry trends.  The senior execs understood they needed a dedicated resource to focus on analytics who could support sales efforts by demonstrating the value of the data itself to clients.

I was brought on as Telephia’s first Market Intelligence Manager as part of the client services team.  My role objectives were clear but my job duties and responsibilities were understandably vague.  I worked with all clients and across all products and teams.  Given this nature of my role, I also became a useful conduit for sharing learnings between sales/account management and product management/development.  There were several benefits resulting from this role:

1. The “teaser” analyses that addressed real industry issues drew keen interest from potential clients which helped pry open doors for the sales team.  This was the primary objective.

2.  I became an internal client user of our products and data, and could provide advance feedback to the product teams which allowed to address potential issues before the client saw them.

3.  As an expert user of our products, I was able to help account managers better understand the advantages and limitations of our products, which led to improved client trainings and satisfaction.

Within about 6 months after creating the market intelligence function we’d signed our first major client, AT&T Wireless.  But Telephia still experimented with the best place for market intelligence within the organization structure.    In 2001, Telephia created a separate Market Intelligence department with its own VP.  However, less than one year later the market intelligence function was folded back into Account Management, where teams were now also responsible for data analysis.  Throughout the company’s first five years, there were regular reorganizations, downsizings and upsizings.  But throughout this period, the account management and market intelligence teams were recognized as key drivers behind the company’s rapid growth.

I think mobile marketing agencies may also benefit from a similar type of structure.  If anything, the data streams and other information needing to be synthesized by mobile marketing agencies is potentially even more complex than Telephia’s.  Those agencies who are first to make serious and sustained efforts to tame this information and deliver it to clients will have a definite competitive advantage.  The agencies don’t have to get it totally right the first time.  If it listens and learns from clients, and remains dedicated to demonstrating results to clients it will succeed.

Insight #1: Brands want advertising to sell.  Agencies have other priorities.

Regarding considerations for any campaign media selection, both brands and agencies agree that the most important factors include the ability to reach a large, demographically suitable audience.  This works in favor of mobile for broadcast campaigns due to its unmatched installed base, particularly if the campaign employs a widely deployed phone feature like SMS, but mobile’s reach can be whittled down quite quickly if a campaign involves video or rich media campaign.  While not particularly a revelation, I found the difference in importance of incremental sales impact among brands and agencies surprisingly large.  Almost three-quarters brands (72%) mention a media’s ability to impact  incremental sales as a consideration factor, while only 44% of agencies mention it.

Again, a gap is not particularly surprising, but it highlights both a problem and opportunity for mobile marketing.  Based on my experience on both the client and agency side, I can say the problem many time come from both sides.  Agencies, and perhaps even the client’s own marcom people, many times don’t know the exact the sales objectives for a particular campaign.  And even the agencies ask and the client has it, some do not want to share that information due to confidentiality reasons.  This to a certain degree limits the agency’s ability to choose the right media, set budget requirements, and generally build the right campaign to achieve the desired sales objective.  Perhaps brands feel that sharing this information is unnecessary because they cannot accurately track back a sale to a particular campaign.

Insight #2: Brands and agencies use different mobile media channels.

Most brands’ and agencies’ campaigns include SMS messaging and mobile websites in their campaigns, and significantly more agencies use this channel than brands (79% vs 56%, respectively).  But was I surprised to see that 42% of brands, their third-most commonly used component, was voice/IVR.  Only 9% of agency campaigns include it.    Agencies also use advertising in SMS programs (21%), mobile applications (33%), and mobile games (12%) significantly more often than brands.  Alternatively, brands are at least twice more likely to use bluetooth (8%) and ads in mobile video (6%) than agencies in their mobile marketing activities.  What is driving these differences?  Are the brands wasting their budgets on these campaigns or are agencies missing some channels that brands find meet their goals and needs more effectively?

Insight #3: Campaign-specific execution metrics, not cross-channel ROI metrics, predominate success measurement of mobile campaigns.

As for evaluating mobile marketing activities, most of the metrics listed in the responses are channel specific (e.g. SMS response/opt-in rates, mobile web unique visitors).  I looked more closely at the more cross-channel metrics like cost per order, pass-along rates, cost per customer acquisition, and incremental sales/revenue to compare agencies and brands.  These metrics rank about equally low among both brands and agencies with a couple of exceptions.  Significantly more brands measure campaigns for incremental sales/revenue than agencies (22% vs 15%), although the brand responses were surprisingly low given that 72% of brands said that this is a consideration factor in choosing media.  On the surface, it implies that sales impact is top of mind in the planning phase, but its importance gets lost in the shuffle in the execution phase.  Or, as I mentioned earlier, perhaps brands assume it is too difficult to connect the dots  between sales and campaigns and therefore keep sales impact an intention but not a concrete deliverable.  Significantly more agencies than brands measure cost per order (21% vs 15%), but it ranks low among both groups.  The viral effect of campaigns (i.e. pass-along rates) also rank at or near the bottom of metrics tracked by both groups (18% of agencies; 14% of brands).  The elusiveness and unpredictability of the viral effect probably explains the statistic, but this is a powerful element of mobile media that can have a huge impact on a brand’s image and campaign’s success.

This data highlights the opportunity for mobile marketing to become more tightly integrated into sales and marketing.  Brands now have a strong reason to collaborate more closely with mobile marketers as true sales and marketing partners because they will be able to link results much more accurately actual sales to campaigns.  For mobile marketing agencies, the challenge as always will be for mobile marketers to integrate themselves earlier and deeper into brands’ sales/marketing planning and execution processes, which requires them to build a case and a level of trust with their client brands.  The trust can be built by mobile marketers continuing to demonstrate mobile’s unique relationship with consumers, its ubiquitous nature, and its ability to connect the dots between sales and ad spend.  Analytics in the planning and evaluation phases of campaigns, as well as close collaboration with, and information sharing by, clients and their agencies is the foundation on which this trust will be built.

Lately Apple may be wondering where all of the love went.    During the past few weeks, Apple and the iPhone have probably felt a distinct chill in the air lately, as everyone from consultants and industry analysts to the FCC to the European Commission I’ve noticed several uncharacteristically sober articles about the iPhone and it’s effect on the mobile industry.  Perhaps the iPhone’s honeymoon with the media and operators is over?

A lengthy report by Strand Consulting titled “The moment of truth, a portrait of the iPhone”, it tries to dispel the 10 “myths” about the iPhone’s benefit to mobile operators.  A study of venture-backed mobile startups by ChubbyBrain shows that two-thirds of mobile apps developers are hedging their bets by creating their apps to work on multiple platforms.  Nielsen’s Roger Entner, SVP, Research & Insights, Telecom Practice for Nielsen, asked the question “Does the iPhone really matter?”, citing data from Nielsen’s quarterly mobile user motivation survey showing that the model of mobile phone is not very important in most consumers’ selection of a mobile operator.  Then there is the big spat with Google over Google Voice mobile app for the iPhone, which dragged AT&T into the fray with it, and result in an inquiry by the FCC Apple’s exclusivity arrangement with AT&T.  And just this morning, The Gadget Hound blog reported of an investigation started by the European Commission in exploding iPhones and iPod Touches in France, the Netherlands, and the UK.

White hot romances are rarely stay that hot over time.   We must give credit where credit is due.  Apple gave the mobile phone user interface, mobile web browsing experience, and mobile application development a much needed shot in the arm (or should I say kick in the pants?).  But, after 2-3 years I think its first-mover advantage is fading as industry analysts and operators are able to measure its real impact, competitors have been able to learn from it, and consumers are more educated about its limitations and have other choices.

Poor iPhone.  For smartphones as in life – you can’t be loved by all of the people, all of the time.  But, of course, it’s better to have been loved and lost, than never to have been loved at all.

Is that too many cliches?

http://ukraine-mcq.blogspot.com/

So what does this prediction mean for retailers?  If they react anything like mobile operators did when subscriber growth slowed and competition heated up, it will mean a greater emphasis on keeping existing customers (i.e. strengthening customer loyalty).  As we all know, it’s less expensive to sell an existing customer than attract a new one.  Unfortunately for retailers, they don’t have the luxury of locking in customers to exclusive 2-year contracts.  But they do have a powerful new tool in mobile media to help them bring back the spirit of retail’s Golden Age.

By Golden Age I refer to the early days when most retail was locally owned and operated – the “mom and pop” shops – and the retail legends of today were opening their first stores.  Personal relationships with customers were paramount, and seemed to develop more naturally.  They made a point to recognize each of their customers and address him or her on a personal level – “Hello, Mr. Smith!”.  The sales staff knew the personal preferences and dislikes of their best customers, as well as their past purchases – “I know your favorite color is blue, so let me show you this new tie that will go nicely with the shirt you bought a couple of months ago”.    Perhaps I’m romanticizes things a bit, but I doubt anyone would argue that this type of customer interaction occurred much more frequently 50 years ago than it does now.  As the industry evolved into large nationwide retail corporations, consumer traffic shifted to the big regional shopping malls and mega stores, and retail sales associate positions have become more temporary jobs than career paths, the retail experience has lost a lot of its personal touch.

But the retail business environment consumer shopping habits have changed.  It is more complex, competitive and fast-changing.  Customers are more demanding, sophisticated and have many more choices particularly when you consider online – and now mobile – shopping.  And while good old-fashioned, face-to-face personal connection and good salesmanship will always be appreciated by customers, retailers need new tools and channels to engage customers and make them feel special even when they are not physically in the store.

Mobile media and mobile marketing offer the best opportunity on a mass market scale to rekindle that Golden Age spirit of the personalized retail experience in the digital age.  It promises to build and strengthen one-to-one relationships with each customer through personalized offers and an ongoing mutually-beneficial dialogue.  Mobile is unique its ability to reach more people  at any time, in any place, in such a personal way, with such a variety of formats (e.g. text, picture, video, audio).  And let’s not forget that the mobile phone is first and foremost a communication device that people use to share information, feelings and experiences, so its viral power is also unrivaled.

With regard to the art and science of retail, mobile media also has the infrastructure to support the “science” in terms of its ability to analyze and target customers as well as measure the effectiveness of marketing initiatives.  The main challenges for retailers interested in using this channel will be how they use these tools, the content they send through the channel, and how well they integrate it into their overall marketing campaigns and points of sale (both in-store and online).  This is where the “art” comes in.  Innovative strategies executed creatively will set apart the superstars.

Finally, those retailers who invest in their time and budgets in mobile media now in its nascent stage, will reap the benefits later when the economic picks up and their competitors scramble to move down the learning curve while experimenting with their own mobile strategies.  Over the long term, the early adopters who successfully leverage this channel should see an improved bottom line through more sales, higher market share, lower customer acquisition costs, and more loyal customers compared to their laggard competitors.