Strike Ad Key Developments In Mobile Advertising

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Key Developments in Mobile Advertising 2011.
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  • 1. Key developments in mobileadvertising 2011 the agency view g omin Overc dles r t he hu What’s inside: Average campaign spend 2011 projections Factors limiting spend Planning and buying trends Unlocking budgets 1 hour campaign goal UK mobile advertising forecasts Sponsored by Researched & written by StrikeAd TM Powering mobile advertising www.mobilesquared.co.uk
  • 2. About the authorNick Lane is chief strategy analyst at mobileSQUARED. The research of this report wasconducted during March and April 2011. Nick has been covering the mobile advertis-ing industry since 2005, and has written numerous reports and white papers on allaspects of mobile advertising during this period for clients, provided consultancy forsome of the leading players in the mobile advertising ecosystem, and presented atconferences all over the world.About the mobileSQUAREDmobileSQUARED provides specialist research which enables brands, agencies and the mo-bile industry to increase engagement with the mobile consumer. We conduct primaryresearch on the mobile industry and mobile consumers, with a focus on delivering ex-clusive forward-looking data on mobile device usage, mobile web, app and commercetrends and usage, and mobile advertising responsiveness to help clients identify andrespond to fast-changing mobile trends. And for a wider view of the industry, weprovide detailed mobile industry user and revenue forecasts.Our clients look to mobileSQUARED’s expertise to provide candid insight into the mobilemarket. We do this using our extensive global network of senior contacts to research,collect and collate the latest data, developments, trends and insight on an ongoingbasis.For more information www.mobilesquared.co.uk / email nick@mobilesquared.co.uk2 Key Developments in Mobile Advertising 2011
  • 3. Contents Methodology 4 Survey results and analysis 5 - What does 2011 hold in store? 7 - What are the agencies telling us about planning and buying? 10 - What are the agencies telling us about the important factors to increase their spend in mobile 12 What does this mean 17 The Mobile Campaign Client Strategy 18 The UK mobile advertising revenue-generating triumvirate 20 Conclusion 21 Source: Mobile Consumer Trends, mobileSQUARED www.mobilesquared.co.uk 3
  • 4. MethodologyThe qualitative-based research took place between March and April 2011. Agencies(as well as companies) involved in the process of planning and buying mobile mediainventory were either interviewed face-to-face or asked to fill out an online form onsurveymonkey.com.The direct aim of the survey was to understand their attitude, behaviour and expecta-tion towards the planning, buying and reporting of mobile campaigns, based on theirexperience in 2010, and predictions and requirements for 2011.Survey questionsQ1: What percentage of your clients’ campaigns will contain mobile (and mobile ele-ment of a campaign) in 2011?Q2: What was the average spend for mobile (including mobile element of a cam-paign) in 2010?Q3: By what percentage do you expect the average spend for mobile (and mobile ele-ment of a campaign) to increase in 2011?Q4: What is the average time spent planning and buying mobile (mobile element of acampaign) for the client?Q5: Which out of the following are the most important factors to speeding up themobile media buying and planning process?Q6: What are the biggest hurdles that need to be overcome in order for your mobilespend to increase significantlyQ7: What percentage of your day would you expect to spend planning, buying andreporting on mobile?Q8: On a scale of 1 to 5, how important is mobile to you as a part of a Brand cam-paign (1 being least and 5 being most important)Q9: On a scale of 1 to 5, how important is mobile to you as a part of a Direct Re-sponse campaign (1 being least and 5 being most important)RespondentsA total of 46 companies took part, including: ZenithOptimedia, Starcom MediavestGroup, Mindshare, PHD Network, O2, Movement, Ogilvy, Somo, Isobar, MediaCom,Neo@Ogilvy, Profero, Vizeum, PHD Rocket, Manning Gottlieb OMD, Mediabrands,Fetch Media, Phonevalley, Orange, The Digital Parent Company, MediaCom North,Amobee, Zenith, Blowfish Digital, OMD, Joule, Blyk, Aegis Media, Unanimis, MEC,dnx, Nielsen, Adsmobi, UM London...All research and analysis have been conducted independently by mobileSQUARED.4 Key Developments in Mobile Advertising 2011
  • 5. Survey results and analysis What percentage of your clients’ campaigns will contain mobile (and mobile ele- ment of a campaign) in 2011? Source: mobileSQUARED Almost 33% of agencies expect over 30% of their clients’ campaigns to contain mobile (or an element of mobile) in 2011. While that is indeed the headline figure, a little under 22% of agencies expect mobile to feature in 11-20% of their clients’ campaigns. However, 39.1% of agencies expect mobile will feature in 1-10% of their clients’ cam- paigns. The breadth of responses really highlights the range of views concerning the impor- tance mobile as a marketing and advertising medium plays within an overall cam- paign from an agency’s perspective – an issue that is addressed later. A breakdown of the agency responses that expect over 30% of their clients’ cam- paigns will contain mobile or a mobile element, reveals that 75% of the agencies have a strong mobile pedigree – have a mobile history, such as a pure-play mobile agency, compared to only 25% of what would be called a traditional media agency. In fact, 90% of responses in the 0-5% growth category were from traditional media agencies. Similarly, approximately 80% of those respondents expecting growth of www.mobilesquared.co.uk 5
  • 6. between 6-25% were from a traditional media agency.Clearly, those agencies with a deeper association with the mobile industry have amore bullish outlook for 2011. Traditional media agencies moving into mobile aredoing so with greater scepticism, based on a necessity to cover all media, and not justmobile.What was the average spend for mobile (including mobile element of a campaign)in 2010?Source: mobileSQUAREDOf those agencies actively including mobile into their clients’ campaigns, the majorityof spend was below £50,000. A breakdown of the data reveals that 28.3% of agen-cies’ average spend on mobile was less than £10,000, while 30.4% of agencies spentan average of £10,001-£20,000 per mobile campaign, and 32.6% spent an average ofbetween £20,001-£50,000.The good news is that some brands started flirting with bigger budgets for mobile in2010. While only 2.2% of agencies said they spent an average of £50,001-£100,000 onmobile campaigns in 2010, 6.5% said their average spend was in excess of £100,001.6 Key Developments in Mobile Advertising 2011
  • 7. There was a correlation between agencies predicting a lower growth in mobile campaign spend for 2011, and their average mobile campaign spend for 2010. For example, agencies that expected between 0-15% of campaigns to be mobile (or contain a mobile element) for 2011, generally had an average mobile campaign spend (in 2010) of between £10,000 and £20,000. Agencies projecting a greater-than 30% increase in average mobile campaign spend, on the whole, had clients investing more in mobile campaigns (£20,000-£50,000) in 2010. Spend in 2010 clearly has influenced an agency’s outlook for the near-term future. Approaching the analysis of the average spend data from a different angle altogether reveals more intriguing trends. The number of agencies actively including mobile within their clients’ campaigns compared to spend highlights a clear void in spend between £50,000 and £100,000. Given that the majority of agencies expressed their view that mobile was still seen as a largely “experimental” medium, the data indicates what mobileSQUARED has identified as a three-phased approach to mobile advertising spend development. Firstly, is the experimental budget which involves a mobile campaign spend of up to £20,000. This is followed by “Repeat Campaigns” phase, where the budget is increased to a limit of £50,000 per campaign, allowing the agencies to explore the mobile medium on behalf of their clients and increase the frequency of campaigns. Phase 3 is for mobile to then become fully immersed within the brand’s marketing mix, and in doing, the budget is raised to £100,000, leaping the financial no-man’s land of £50,001-£100,000. mobileSQUARED calls this the “Mobile Campaign Client Strategy” (MCCS), and will explore this in more depth in the “What does this mean?” chapter. Analysis of mobile campaign spend by agencies in 2010 reveals that the average mo- bile campaign cost £33,912. What’s more, using spend as a guide, this places the ma- jority of agencies within the “Repeat Campaigns” phase of the MCCS development. According to research by mobileSQUARED, the average mobile campaign spend in the UK in 2010 was £20,000. This latest research highlights that agency spend in mobile is now higher than the average mobile campaign spend in the UK. What does 2011 hold in store? By what percentage do you expect the average spend for mobile (and mobile ele- ment of a campaign) to increase in 2011? Agencies are exercising an element of caution when it comes to 2011. Although 21.7% anticipate average spend on mobile campaigns to increase by over 30% in 2011, 65.2% of agencies expect average spend to increase between 6%-25%. Only www.mobilesquared.co.uk 7
  • 8. 4.3% of agencies expected mobile spend to increase by less than 5% in 2011. By what percentage do you expect the average spend for mobile (and mobile element of a campaign) to increase in 2011?Source: mobileSQUAREDThere is very little consistency between agency spend, penetration of mobile withincampaigns, and their projected growth in average spend for 2011. For example, oftwo agencies that both said mobile will feature in over 30% of their clients’ cam-paigns, and had an average campaign spend in 2010 of £20,000-£50,000, one wasexpecting growth of 11-15% compared to 21-25%. Agencies spending in excess of£100,000 per campaign in 2010 expected growth in 2011 of 11-15% and 26-30%.Similarly, there was a broad response (between 0-5% all the way up to over 30%)from those agencies spending an average of less than £10,000 per campaign andtheir projected growth in 2011.Based on the agency responses for 2011, the average mobile campaign spend to in2011 will increase to £38,752 in 2011, up by 14.3% on 2010.But this question also invoked additional comments from agencies. One planner said“We have tried to get our client to do more [in mobile], but they are reluctant. I amplanning 2012 now and will be aiming to get them to invest in mobile.” While anagency peer said “Our turnover was 7 figures and none of it was mobile advertising.”8 Key Developments in Mobile Advertising 2011
  • 9. What is the average time spent planning and buying mobile (mobile element of a campaign) for the client? Source: mobileSQUARED The majority of time spent planning and buying a campaign is weighted very much in favour of taking in excess of ½ a day. In total, 17.3% of agencies said planning and buying a mobile campaign took no more than “hours”. That leaves 82.7% of agencies claiming mobile takes up to ½ a day or longer. To breakout that figure, 15.2% of agencies said mobile planning and buying took ½ a day, with 13% saying the process took 1 day. The majority of agencies – 32.6% – said mobile planning and buying took between 2-4 days, while a further 21.7% claimed it took them over 5 days. When considering the average mobile campaign spend for an agency was £33,912 in 2010, and taking into account the fact an agency would receive 10-15% of campaign spend for their role in the value chain, that would be a total of £5,086, which for a campaign that has taken in excess of 1 working week, would deliver a miniscule mar- gin/ROI for the agency. www.mobilesquared.co.uk 9
  • 10. What are the agencies telling us about planning and buying?This was another question that sparked additional feedback when it comes to devel-oping a mobile campaign.“We are going to plan and buy mobile campaigns on a regular basis across 16 markets.Each campaign requires to create new tracking links, to duplicate the mobile site tohave a unique URL to give to the publisher/ ad network. Preparing a campaign willusually require a few days, the time to coordinate with our creative mobile partner andwith the vendor.”“We have spent endless hours coming up with innovative use of mobile for our clientbut have not been able to sell anything in as of yet.”“The market needs to do more work to get away from it being like the wild west ofadvertising.”“At present planning and implementing mobile campaigns is time consuming due tothe lack of reporting infrastructure and tracking.”“Fragmented market makes planning and buying resource intensive. No real tradingsystem in place to help with the workflow from planning, transacting, optimising andreporting as yet.”“Process needs to be as simple as possible. Reach - Ease of use - Responsive - Reportable”Analysis of the time spent planning and buying a mobile campaign vary massively be-tween agencies, with some agencies clearly more advanced (or should that be morerefined?) than others. The one clear correlation between time and spend was thatthe majority of campaigns costing £20,001-£50,000 would take between 2-4 days.Responses from agencies with a stronger focus on mobile varied from “hours” to“week +”, as indeed did the responses from the traditional media agencies. Whatshould be of concern for some agencies, is that planning and buying a mobile cam-paign for £10,000 could take over a week, whereas those agencies with an averagemobile campaign spend in excess of £100,000 could complete the process between2-4 days.Efficiency based on time versus spend will naturally play a very influential role for anagency when presenting mobile to a client. An agency likely to generate over £15,000for a week’s work (based on the 15% rev share identified earlier for a campaign of£100,000+) is much more likely to create a compelling argument for the client tospend on mobile, compared to an agency that is plying for a £10,000 campaign.10 Key Developments in Mobile Advertising 2011
  • 11. Which out of the following are the most important factors to speeding up the mo- bile media buying and planning process? Source: mobileSQUARED At this stage of the research, agencies could select multiple responses. There were three clear standout factors required to speed up the planning and buying process. Number one, amassing 60.9% of agencies was the need for more data. This was fol- lowed by 45.7% of agencies requesting mobile standardisation. And with 41.3% of agencies, was the need for greater understanding of the mobile medium. The least ‘most important’ factor required to speed up the mobile media planning and buying process was the need for an agnostic device platform (15.2% of agencies). Attracting only 17.4% of agencies was the need for 3rd parties planning and buying, as well as a single location to plan and book campaigns. That said, 23.9% of agencies agreed that all six factors needed to be addressed to speed up the process. As with previous questions, there is no correlation between the factors identified in order to speed up the mobile planning and buying process, versus spend, and/or www.mobilesquared.co.uk 11
  • 12. commitment to mobile.The only trend to emerge from the data, is that agencies active in the Repeat Cam-paign phase of their MCCS (ie spending £20,001-£50,000), were more likely to re-quest an agnostic device platform. Otherwise responses were random in the extreme.An agency spending an average of £10,000 per mobile campaign is as likely to request‘more data’, mobile standardisation’ and a ‘greater understanding of mobile’, as anagency that will spend £20,001-£50,000 or indeed £100,001.What are the agencies are telling us about the important factors toincrease their spend in mobile:As with the previous question, it did evoke additional areas of concern.“Mobile advertising can deliver superb user journeys....but agencies and their clientsare not yet delivering the best possible experiences. You still click through to websitesnot mobile optimised!”“For mobile to be considered “another browser” for the internet and allowing you tobuy inventory based on browser/Operating system.”“Tagging, tracking and search re-targeting.”“We have trouble selling in mobile campaigns presumably because it’s not mass andtherefore doesn’t have the visibility that clients see and understand.”“3rd party ad-serving would really help, so we can upload all formats to one company.”“There is a lot of knowledge with a small number of individuals, this needs to change.”“Ad-serving, Post impression and post click tracking, tracking in general.”“Although as understanding grows, the ‘bottleneck’ will move to the other issues inyour list.”“Better learnings on ad network performance.”12 Key Developments in Mobile Advertising 2011
  • 13. What are the biggest hurdles that need to be overcome in order for your mobile spend to increase significantly Source: mobileSQUARED The biggest hurdles are unique user tracking (56.5% of agencies) and third-party serv- ing (52.2%). This was followed by 32.6% of agencies believing aggregated reporting and real-time bidding (13%) are the third and fourth biggest hurdles, respectively. A similar total of agencies to the previous question (23.9%) said all four issues needed to be overcome in order to accelerate their mobile spend. While once more, there are no obvious trends emerging from the data, the appeal of ‘unique user tracking’, aggregated reporting’ and ‘third-party serving’ are apparent based on responses to previous questions. The demand for aggregated reporting and third-party serving from agencies is driven by the need to increase efficiencies when planning and buying a mobile campaign. These two factors will inevitably remove a number of the pain-points already raised during this research process. User tracking is different, as that justifies spend in mobile, and provides a clear return on investment by the agencies to their clients. A transparent unique user tracking system will also accelerate the development of the MCCS. www.mobilesquared.co.uk 13
  • 14. The lack of demand for real-time bidding is one of the main factors highlighting theembryonic development of mobile advertising. This can also be supported by themajority of agencies in the first two phases of the MCCS (Experimental and RepeatCampaigns). Only when the brand is fully immersed in mobile, having gained a soundunderstanding as to how mobile can support, supplement and compliment othermedia, as well as playing a significant standalone role, will brands’ requirements formobile prompt their agencies to subsequently request real-time bidding, especiallywith the advent of geotargeting.Considering the hurdles that must be overcome to meet the demands emanatingfrom the agencies, with regard to mobile campaigns, what is the optimal time theywould like to spend planning, buying a reporting on a mobile campaign?What percentage of your day would you expect to spend planning, buying andreporting on mobile?Source: mobileSQUAREDIn an ideal world, only 19.6% of agencies are prepared to spend 1 day on a mobilecampaign. Of the remaining 80.4%, 37% of agencies do not expect to spend morethan 1 hour fulfilling the planning, buying and reporting process, compared to 34.8%14 Key Developments in Mobile Advertising 2011
  • 15. of agencies that would accept “hours” and 8.7% that would spend ½ a day. The majority of agencies spending 5-7 days planning, buying and reporting will be content to reduce that period to between ½ to 1 day. The majority of agencies spending 2-4 days planning, buying and reporting, would like to see that time frame reduced to less than 1 hour. Clearly, ½ day would be an acceptable ceiling for the majority of agencies in terms of planning, buying and reporting per mobile campaign, with 1 hour considered the ultimate target. On a scale of 1 to 5, how important is mobile to you as a part of a Brand campaign (1 being least and 5 being most important) Source: mobileSQUARED If we bracket answers ‘1’ and ‘2’ as “not important”, ‘3’ as sitting “on the fence” and ‘4’ and ‘5’ as “important” then the results from the agencies are certainly compelling reading. For instance, 23.9% of agencies claim mobile is not an important component of a brand campaign, 41.3% of agencies sat on the fence with regard to mobile, while 34.8% viewed mobile as an important component. www.mobilesquared.co.uk 15
  • 16. The response to this question can be viewed positively. Already, over one-third ofagencies view mobile as an important part of the brand campaign, with another41.3% yet to make the leap of faith into mobile and identify its overall importance tothe brand. However, given the increasing importance that mobile is now playing inconsumers’ daily lives, as a medium, it can only become more important in the adver-tising mix, and therefore more important as part of a brand campaign.On a scale of 1 to 5, how important is mobile to you as a part of a Direct Responsecampaign (1 being least and 5 being most important)Source: mobileSQUAREDIn addition to the previous question, the results were weighted in favour of mobile asan important component of a direct response campaign – and this certainly echoesthe agency requirement for unique user tracking, as mobile is starting to be viewed asthe missing link in the brand-to-consumer relationship.Applying the same principles as with the previous question, 21.8% of agencies did notplace importance on mobile, 17.4% remained on the fence, while 60.8% viewed mo-bile as an important component of a direct response campaign. Again, this figure isonly going to increase as consumers become more receptive to mobile and increasingtheir propensity to engage and interact with mobile campaigns from brands.16 Key Developments in Mobile Advertising 2011
  • 17. What does this mean? For the majority of agencies, mobile remains a nascent addendum that requires signifi- cant attention for the medium to become a mainstay in their clients’ advertising strategy. The research has identified two core areas that need to be addressed for mobile campaign spend to significantly increase. Firstly, how mobile is positioned by the mobile advertising ecosystem to the agencies. Secondly, how the agencies sell mobile to their clients. Taking one point at a time, agencies are clearly not being provided with the informa- tion, data, knowledge and technical capability to efficiently plan, buy and report on a mobile campaign. In terms of important factors to be addressed in order to speed up the mobile plan- ning and buying process, there is a clear distinction between the primary factors, and what can be considered secondary factors. Data, mobile standardisation and a greater understanding of the mobile medium, are the primary factors to address. Sec- ondary factors are single location to plan and book campaigns, third-parties planning and buying, and an agnostic device platform. A lack of data – or as Claire Valoti, head of online and mobile at Mindshare, puts it, “there is an abundance of data, but a lack of the right data”. The fragmentation of the mobile industry has prompted agencies to call for mobile standardisation, but this is symptomatic of the mobile industry and is more likely to get worse before the situation improves. Also, agencies continue to ask for a greater understanding of the mobile medium. With regard to this last point, the mobile advertising ecosystem is not delivering the relevant (or the required) information. An alternative viewpoint, is that agencies have to spell out to the players in the mobile advertising ecosystem what exactly it is they need to understand. Regardless, there is a clear disconnect in communication between ‘mobile’ and ‘agency’, and this has to be identified and redressed urgently. Furthermore, this disconnect is then effectively being extended by the agency to its clients, and explains why a number of agencies are facing a brick wall when it comes to selling mobile into their clients. The data suggests that media agencies are not as effective as selling the concept of mobile to their clients compared to agencies with a strong mobile heritage. There are also hurdles. The most important hurdle to overcome to ensure agencies will increase their mobile spend is the provision of unique user tracking, followed by third-party serving, and aggregated reporting. These three areas must be the prior- www.mobilesquared.co.uk 17
  • 18. ity for mobile advertising solutions providers. Real-time bidding from an agency’sperspective is a secondary requirement.And the removal of the hurdles leads onto perhaps the most important considera-tion of all: time. The creation of mobile campaigns is considered “time consuming”,with the majority of agencies spending 2-4 hours developing a mobile campaign.The target for the mobile advertising solutions providers is to create a platform thatcan plan, buy, execute and then report a mobile campaign in no more than 1 hour(excluding the time it takes for the campaign to run, naturally), although agencies willclearly accept spending a total of ½ a day on a mobile campaign.The fact the existing mobile campaign process takes a significant chunk out of anagency’s week has to be considered the most important hurdle of them all to over-come in order to unlock the wealth of advertising budgets agencies control.The Mobile Campaign Client Strategy The Mobile Campaign Client StrategySource: mobileSQUAREDAs already stated in the previous chapter, the Mobile Campaign Client Strategy (MCCS)is a three phased approach by an agency to develop their client’s mobile evolution.18 Key Developments in Mobile Advertising 2011
  • 19. The split in factors and hurdles to be addressed in order to speed up the mobile plan- ning and buying process can also be closely linked to where the agency is with their client with regard to the MCCS. With regard to the primary factors of data, mobile standardisation and a greater understanding of the mobile medium, these are all requirements of an agency learning and developing how to utilise the mobile op- portunity (Phase 1 and Phase 2 of MCCS). Whereas factors such as a single location to plan and book campaigns, third-parties planning and buying, and an agnostic device platform, represent a more advanced understanding of mobile, and a requirement to improve efficiencies associated with the campaign process (Phase 2 and Phase 3). In terms of the most important hurdle to overcome, the provision of unique user tracking, followed by third-party serving, aggregated reporting, and also real-time bidding, would feature in an agency with more advanced mobile campaign planning and buying requirements, such as those in Phase 2 or Phase 3 of MCCS. This means, as agencies become more familiar with the processes involved in creating a mobile campaign, their understanding of the complexities involved, and therefore the hurdles associated with mobile also become more apparent. As they persist with Repeat mobile campaigns, their demands and requirements to dramatically improve their efficiency increase in direct correlation with their average spend per campaign. Evolving the Mobile Campaign Client Strategy Source: mobileSQUARED There is good reason for agencies to use Phases 1 and 2 to introduce mobile into their client’s advertising agenda, with the ultimate goal of total mobile immersion (Phase 3), where budgets are significantly higher. The experimental ‘legwork’ and Repeat www.mobilesquared.co.uk 19
  • 20. Campaign exploration of mobile, will then result in the unlocking of the big budgets,and agencies start to receive a much improved ROI for the time spent on mobilecampaigns moving forward.As highlighted in the previous chapter the average agency spend on mobile in 2010was £33,912, and is expected to rise to £38,752 in 2011. An increase of 14% in a sec-tor forecast to grow 101% in the same period.The UK mobile advertising revenue-generating triumvirateAccording to mobileSQUARED’s mobile advertising forecasts for the UK market, spend willincrease from £71.81 million in 2010 will increase by 101% in 2011 to £144.3 million,and by 82% between 2011 to 2012, to £259.6 million.To provide some detail into the numbers, mobileSQUARED has identified three core areasfor spend: opt-in messaging, search and banner ads. For opt-in messaging, the figurefor 2010 of £33.4 million includes what would also be deemed ‘mobile marketing’,ranging from operator-based initiatives such as O2 More and Orange Shots, to direct-to¬-consumer strategies from brands and businesses. UK mobile advertising forecastsSource: mobileSQUARED20 Key Developments in Mobile Advertising 2011
  • 21. Search is forecast to grow 99% between 2010 and 2011, from £10.2 million and £20.3 million. These figures are significantly below numbers released by the Internet Adver- tising Bureau (IAB) and PwC. The IAB data said that mobile search was worth £54.9 million last year, up from £20.2 million in 2009. However, mobileSQUARED believes the mobile search figure needs clarification as the majority of mobile search revenues are not derived from mobile websites, but from fixed internet sites which merely allow mobile search. The majority of the top 100 advertisers on Google still do not have mobile sites which leaves mobileSQUARED to esti- mate the amount of UK mobile search revenues actually derived from mobile sites in 2010 was £10.2 million, meaning that over £44 million was actually spent on sites not optimised for mobile. Of the triumvirate of mobile advertising revenue generators in the UK, that just leaves banner ads spend, which is forecast to grow 61% between 2010 and 2011, from £26.3 million to £42.4 million and by 52% the following year to £64.3 million. With average agency mobile spend expected to be £38,752 in 2011, the percentage increase in campaign spend of 14% is considerably lower than mobileSQUARED’s pro- jected mobile advertising revenue market growth of 101%. This can be attributed to – in part – to the increase in spend from agencies, but primarily down to the increase in mobile campaign frequency, especially as more agencies operate within Phase 2 of MCCS, and then migrate into Phase 3. Clearly, there is an agency need to migrate their clients into MCCS Phase 3 as soon as possible, in order to maximise their ROI from the mobile channel. Conclusion Based on the research, 58.7% of agencies are in Phase 1 of their MCCS for clients, 32.6% are in Phase 2, leaving 8.7% in Phase 3 and with a foot in the door when it comes to including ‘mobile’ within the budget for a client’s advertising strategy. The lack of data, as well as a need for mobile standardisation, and greater dissemina- tion of mobile knowledge throughout the agency world, is required to migrate agen- cies in Phase 1 into Phase 2. When an agency has passed the Experimental Phase and executing Repeat Cam- paigns (Phase 2), is when there is a compelling need for more advanced solutions, such as unique user tracking, third-party serving, aggregated reporting, and real-time bidding, to increase efficiencies in terms of time spent planning, buying and report- ing on a mobile campaign. At present, the requirement for such solutions would be applicable to approximately 40% of the agencies. www.mobilesquared.co.uk 21
  • 22. As agencies create more campaigns, they will inevitably spend more time planningand buying. The research has revealed that the majority of agencies would like tospend a total of 1 hour planning, buying and reporting on a mobile campaign. An ele-ment of flexibility up to 1/2 a day would be accepted by agencies operating in Phase3 with higher budgets.Agencies more focused on mobile are operating in a virtuous circle of higher budgetsleading to a more bullish outlook in terms of increase in average spend per mobilecampaign.The average spend per mobile campaign by agencies will grow 14% from 2010 to2011, however, with more agencies operating within Phase 2 and migrating intoPhase 3 of their client’s mobile strategy, the number of repeat campaigns will in-crease in 2011, fuelling the 101% UK mobile advertising revenue growth prediction bymobileSQUARED for 2011.And here’s one more mobileSQUARED prediction to whet your appetite for mobile adver-tising even more: we will see the first £1 million mobile advertising campaign in 2011. Source: Mobile Consumer Trends, mobileSQUARED22 Key Developments in Mobile Advertising 2011
  • 23. StrikeAd TM Powering mobile advertising StrikeAd was set up by entrepreneurs Alex Rahaman and Simon Wajcenberg in 2010 to satisfy the global need for a streamlined media planning and buying environment on mobile. StrikeAd FusionTM is the worlds first dedicated mobile demand side platform. The StrikeAd Fusion platform is the first dedicated mobile advertising Demand Side Platform (DSP) which allows advertisers, agencies and brands to quickly and transparently plan, opti- mise and deliver effective global mobile advertising campaigns. StrikeAd Fusion allows media buyers and planners to create dynamic campaigns across multiple Supply Side Platforms, Ad Networks, operators and territories, reducing time, cost and complexity while offering greater control, better data, and improved ROI. A managed service that can be tailored for agencies who wish to buy mobile media campaigns but don’t want to licence a technology platform. StrikeAd Engage utilises StrikeAdFusion to pur- chase mobile advertising inventory from multiple sources and optimise performance in-house with advanced analytics. For more information, please visit www.strikead.com
  • 24. UK mobile advertising consumer data points BORDER: TYNE-TEES: Mobile internet users with Android (1Q-4Q11) Mobile app users with iPhone (1Q-4Q11) Q4 Q3 15 670 Q1 Q2 18,9 24, Q2 Q1 370000 277500 Q3 Q4 463 296 185000 30, 36, 92500 www.mobilesquared.co.uk 0 UK Opt-in messaging users by gender (3Q11) UK Mobile internet users by device type (3Q11) 4400000 es tphon Smar 15000000 3300000 2200000 11250000 1100000 nes repho Featu 7500000 0 3750000 es Ot phon he Legacy rs m ar tp an ho 0 dr ne iph o -6 on id - 50 e- 274 ,807 65 ,91 0,8 4 07 Mobile app users by smartphone type (3Q11) UK Mobile advertising reach by age (4Q11) 4000000 25-34 18-24 Yorkshire 3000000 35-44 2000000 45-54 1000000 55-64 Data provided by 0 mobileSQUARED’s Mobile Consumer Trends