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Johannison Johannison Presentation Transcript

  • Opportunities of mobile advertising
  • Agenda
    • The Market
    • The Opportunities and challenges
    • Relevance and reach
    • What is Ericsson doing?
  • The mobile advertising landscape Some operators estimate 1-5% of tot. revenues may come from ‘ mobile advertising’ in 5 years time MA represents a little more than 0.1% of operator revenues Mobile advertising accounts for under 1% of total advertising spend Jim Stengel, CMO, Procter & Gamble 50% of brands say they will spend 5-25% of their ad spend on mobile in 5 years time View slide
  • The mobile - a new media channel with some unique capabilities
    • Would you lend it to me?
      • The mobile is Personal!
    • What would you do when the cinema is over
      • The mobile is Always on!
    • What would you do when your company have left the table?
      • The mobile is Always there!
    The characteristics of the mobile is changing our daily behavior View slide
  • Mobile advertising opportunities
    • Operators
      • New revenue stream
      • Speed up initial consumer adoption for new services
    • Consumers
      • Subsidized content and services
    • Advertisers
      • Targeted - messages must be more engaging and relevant to be of interest
      • Interactive - orientate their values around connection and sociability
    • Agencies
      • New area of expertise and improved campaigns
  • Industry challenges and barriers
    • Operators
      • Lack of knowledge and inventory to monetize
    • Consumers
      • Fear of intrusiveness
    • Advertisers
      • Uncertainty of Return on Investment
    • Agencies
      • Expensive and difficult to buy mobile advertising
  • It is all about Relevance and Reach Revenues
    • Delivering the right content in the right context to the right person
    • Targeted and personal, but not intrusive
    • Reach as many people as possible
    • Across media, platforms, devices and territories
    Relevance Reach
  • Relevance is key Relevant targeting is one of the major factors differentiating mobile media from other advertising windows Anonymous Advertising Ads are not based on any targeting Criteria. $5 CPM rate Level of targeting Contextual advertising Ad based on contextual criteria, e.g. type of content, location. $25 Personalised advertising Ad based on specific, personal criteria, e.g. preferences, location, usage, time. $50 Source: Eden Zoller, Ovum, May 2007
    • But we should not overplay the mobile’s USP’s…
    • Are operators the only ones able to offer targeted mobile inventory?
    • Few advertisers want micro-segmentation and targeting at this point
    • Users may not be ready for such tight targeting either
  • Relevant for who? Who would be the target for mobile advertising in CZ? Base: Main mobile phone user Source: Ericsson ConsumerLab Czech country study 2008 Consumer interest in mobile advertising in CZ
  • Relevant for who? Who would be the target for mobile advertising in CZ Base: Main mobile phone user Source: Ericsson ConsumerLab Czech country study 2008 These 5 segments accounts for about 50% of the population
  • Relevance of brands
    • Favorite brands = friends
    • Interest related brands = accepted to certain degree
    • Any brand = not in my mobile
    SOCIAL SPHERE PUBLIC SPHERE Ads are accepted Ads are a part of the environment Favourite brands Interest related brands Any brands PRIVATE SPHERE Ads are intrusive Source: Ericsson ConsumerLab Largest online advertisers in CZ Jan-July 2008 Source: CIA Czech Republic, August 2008
  • How can we reach them? Potential advertising bearers
    • What operators do today
    • Messaging wholesale
    • Targeted Banners
    • Pushed messages
    • Mobile search
    • Idle screen ticker `
    • Ad funded/ free content
    • Prepaid budget notifications
    • Ad sponsored MVNO
    • Mobile TV advertising
    • Location based advertising
    • Ad funded email services
    WAP RBT UGC Mobile TV Mobile search Idle screen Voice mail Portals Video Music Games MMS SMS
  • Operator View Mobile Ad inventory changing from Messaging today to Display, Search and Mobile TV in the future Messaging is currently the key Mobile Advertising vehicle
    • The majority of mobile advertising revenue is and has been off-portal – through internet websites and wholesale SMS
    • Mobile operators have not been active players within the mobile advertising value chain.
    • Display and search would indicate existing internet mobile advertising mechanisms and new social networking sites extending into mobile arena.
    Display, Search and Mobile TV are seen as the key Mobile Advertising vehicles of the future Source: TeliaSonera 2007, Ericsson Business Consulting Analysis
  • Reach the audience thru various channels Relevant advertising formats today and tomorrow…
    • 100% have a mobile phone
    • Over 90% use SMS on a weekly basis
    • Over 25% send/receive pictures on a weekly basis
    • 45% of professional users send/ receive emails
    • Around 20-30% browse the mobile internet regularly
    • Over 40% of Young early adopters play games on their mobile
    • Around 10-15% use Ringbacktones
    • 15% is downloading full length songs monthly
    • Around 5-10% is downloading video clips to their mobile
    • They all have a very high interest in new services such as mobile TV, location, community services
    Source: Ericsson Consumer Lab survey Czech Republic 2008
  • Managing Reach Operators working together….
    • 4 major operators in Sweden have launched a cooperation
    • Standard for formats, measurement and reporting (GSMA)
    • One point of contact for the advertisers
    • Ability to offer campaigns across the operators networks
    • Reach. 2 Million (22% of Pop.)
    • 60% of mobile internet traffic to one of the operators portal
    • Major age group: 26–34 years
    • Pricing: Depending on the place on the site
    • Revenue share between operators depending on number of views per site
    “ We realized that not even with our large market shares we can create enough interest among advertisers for the mobile channel so we asked ourselves the question: How can we grow the market and make it more interesting?The answer was that we need to work together” (Johan Lindgren CEO of Telenor Sweden) Source: Svenska Dagbladet
  • Overview of value chain and expected percentages Advertiser Ad agency Media sales agency Service enabler Publisher/ Operator Consumer Pays 100% Gross ad rate (CPM) Retain 25% of Gross ad rate Retains 15-20% of Gross ad rate Receives 55-60% of Gross ad rate Shares 25-30% with content provider
    • NRK – Mobile TV Interactive Advertising
    • CNN Mobile – Ad revenue supported news portal
    • Mobile TV Vodafone Spain / UK
    • Daimler Chrysler – Promo Application
    • Strategic Advice
    Ericsson experiences
  • Summary
    • Great interest for mobile advertising
    • The key is relevance…for all players involved
    • Awareness and education
      • Innovate and develop credible trials/ proof of concept demonstrating the effectiveness of this channel
      • Educate the advertising community about the opportunities, capabilities and performance of the mobile channel
    • Making it easier to do business should be a high priority
      • Standard formats, metrics and measurements
      • Cross-network connectivity needs to be addressed
      • More clarity around business models
  •