Mobile Convention Amsterdam - Informa - Shailendra Pandey


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Mobile Convention Amsterdam - Informa - Shailendra Pandey

  1. 1. Click to edit Master titleMobile Advertising styleMarket Opportunities, Challenges andRecommendations for Stakeholders Click to edit Master subtitle styleShailendra PandeySenior Analyst, Mobile Content & Appsshailendra.pandey@informa.com 21/04/2011 11/09/2009
  2. 2. The mobile advertising market today• The mobile advertising industry has moved on from the trial and experimental phase and many brands are now spending significant sums on mobile campaigns on a regular basis.• The investment from big players such as Google and Apple validates the market opportunity, resulting in brands and agencies more actively considering mobile for their campaigns.• The launch of Apple’s iAd advertising platform is forcing rivals to speed up their own mobile advertising strategies. Google has responded by acquiring AdMob.• The growth of m-commerce is also making the mobile channel more attractive for advertisers and will be a key driver for mobile advertising in the coming years.• Another key driver is the strong growth of mobile search with Google reporting a 500% growth in mobile search queries between 2008 and 2010.• Market fragmentation in the devices market and among operating systems and a lack of standard practice continue to restrict growth in the mobile advertising market. 21/04/2011 2 ©Confidential
  3. 3. Mobile advertising market drivers and barriers 21/04/2011 3 ©Confidential
  4. 4. Mobile advertising market 21/04/2011 4©Confidential
  5. 5. Global mobile advertising market to 2015Mobile Internet display advertising will overtake SMS to become the biggest mobileadvertising revenue channel in 2011.In 2014, it is expected that advertising revenues from mobile search will – for the firsttime – be greater than advertising revenues from SMS . 21/04/2011 5 ©Confidential
  6. 6. Global mobile advertising revenue share, by type, 2010 vs. 2015 21/04/2011 6 ©Confidential
  7. 7. Mobile advertising ecosystem and value chain 21/04/2011 7 ©Confidential
  8. 8. Mobile Operators• Operators need to partner with companies who can help them use their subscriber data to create a unique centralized picture of each subscriber, and also gain more understanding of their prepaid users.• During 2010, many mobile operators, including Orange, O2 UK, Movistar Spain, VimpelCom Russia, Maxis Malaysia and Claro Argentina, launched services/trials to encourage subscribers to opt-in to mobile advertising.• At present, most operators are using mobile advertising to drive a greater usage of their own services, products and promotions.• It is becoming quite clear that for the operators, close partnerships with other value chain players is essential and a better strategy than attempting to build an in-house mobile advertising solution and their own creative and sales teams.• Mobile operators are now realizing that they need to work together to establish a pan-operator data exchange to strengthen their position in the mobile advertising value chain and to compete with the likes of Google and Apple. 21/04/2011 8 ©Confidential
  9. 9. Advertisers/Brands• Many brands that tried mobile advertising couple of years ago decided to wait because the market then was too fragmented. These brands are now seeing consolidation in the market and are coming back to spend on mobile advertising campaigns.• Increasingly brands are interested in paying for advertising on performance basis i.e. on a CPC or CPA basis rather than CPM.• Having a mobile site is crucial for companies interested in a sustained and long-term mobile advertising strategy. A mobile site is also very useful for collecting consumer data and enhancing the company’s image.• There is a rush from many brands to introduce their mobile app, particularly an iPhone app. However, the app must offer interesting or useful content otherwise not many will use these types of branded mobile apps.• Brands are realizing that once they have one or two popular mobile apps with millions of users, they can also use those apps to promote their new products and services. 21/04/2011 9 ©Confidential
  10. 10. Mobile Ad Agencies Full Service Agencies Aegis Group M&C Saatchi Carat Media Square Fox Interactive Media Medialets gomeeki Mobile Interactive Group Grey Group Ogilvy Impact Media WPP Mobile Specialist Agencies 01tribe iconmobile 12snap Inside Mobile 2ergo Marvellous 5th Finger mFusion AKQA Phonevalley Ansible RingRing Media Cellempower Sponge DYMA Media The Hyperfactory Enpocket We Love Mobile Fetch Media Wireless Developer Agency Source: Informa Telecoms & Media 21/04/2011 10 ©Confidential
  11. 11. Mobile Ad Agencies• Large media agencies are showing a willingness to integrate mobile into the advertising mix but find it challenging to convince brands of the ROI and the premium price associated with mobile advertising.• A key barrier to the growth of mobile advertising is the lack of understanding of the mobile medium beyond SMS campaigns, among the media planner executives within ad agencies.• There is a strong need to educate the media booking agents about the mobile medium. Creative agencies often pitch advertising that can be extended to mobile, which the media booking agents ignore due to their limited knowledge of mobile.• Large media agencies are looking to buy mobile advertising start-ups and mobile specialist firms, which can enable them to offer services to brands showing an increasing interest in mobile advertising and branded mobile apps.• Mobile advertising needs to be integrated into a bigger mix of media to drive creativity and better response rates. 21/04/2011 11 ©Confidential
  12. 12. Mobile Ad NetworksAdmob Microsoft Mobile Advertising4th Screen Advertising Millennial MediaAdfonic Mobile Worx/ZestAdzAdmoda/Adultmoda Nokia Interactive AdvertisingArMobi Pudding MediaBuzzCity Quattro WirelessEnpocket RhythmNew MediaHands Third Screen MediaInMobi TigerspikeJumpTap VeltiMadhouse YahooMADS YOC GroupSource: Informa Telecoms & Media 21/04/2011 12 ©Confidential
  13. 13. Mobile Ad Enablers and Network OptimisersAdsmobi MobPartnerAdMarvel Ringleader DigitalAdWhirl RingRing MediaGreystripe Smaatomadvertise SofialysMedialets TapjoyMobclix DoubleClickSource: Informa Telecoms & Media 21/04/2011 13 ©Confidential
  14. 14. Mobile Ad Networks and Ad Enablers• Mobile ad networks have to play a key role in educating the media planners and encouraging them to run mobile-specific campaigns, and not view mobile as just an extension of the interactive path to TV, online, print and outdoor advertising.• At present, most mobile ad networks struggle to achieve an overall fill rate of higher than 30%. Fill rates are the ratio of served ads to requested ads or available ad inventory.• Mobile ad networks need to focus on increasing the quality of ads served to requests, which will increase CTRs and generate better returns for advertisers and publishers from mobile advertising.• The emergence of ad enablers/network optimizers in the value chain is helping to address the mobile advertising scale and reach issue, improve fill rates and enable mobile publishers to increase their mobile advertising revenues by finding the best- performing ad network for their inventory.• To improve their margins, big players such as Smaato and Mobclix are moving towards becoming mobile ad networks. 21/04/2011 14 ©Confidential
  15. 15. Value chain: Mobile ad platform vendors 21/04/2011 15 ©Confidential
  16. 16. Mobile Ad platform vendors• The shift in the operators’ attitude from building in-house systems towards the purchase and outsourcing of mobile ad-serving platforms has led to the increase in opportunities for mobile advertising platform vendors.• Many operators are negotiating zero-risk trials for mobile advertising with platform vendors. Instead of paying an upfront fee for technology license and hardware, operators are asking platform vendors to implement the solution at their own cost and take a share of the advertising revenues.• Mobile advertising platforms need integration of ad tracking for post-click analysis so that media executives can track the effectiveness of campaigns across different ad networks and publishers.• The lack of standard practice in the various mobile advertising platforms for the measurement of campaigns is restricting the industry’s growth.• Most mobile advertising platform providers have a legacy in network equipment vending and lack knowledge and experience of selling advertising on mobile phones. 21/04/2011 16 ©Confidential
  17. 17. Value chain: Mobile search providers 21/04/2011 17 ©Confidential
  18. 18. Mobile search providers• Many mobile operators offer directory services but do not have search engines that can rival the big online players such as Google, Yahoo, and MSN. It makes more sense for the mobile operators to partner with these big search engines for mobile search.• By partnering with a search engine, mobile operators can take advantage of the search engine’s existing volume of resources and technology, and the search engine will benefit from access to the operator’s large subscriber base.• Search users on mobile phones usually have more urgent needs for the information and therefore, from the advertisers’ perspective, are more likely to pay for their products and services than users of search on PCs.• The reporting of good metrics and analytics on mobile search is needed to gain insights into how specific target audiences use mobile devices to search for products and services. 21/04/2011 18 ©Confidential
  19. 19. Informa viewpoint and recommendationsInforma Telecoms & Media believes that the global mobile advertising market wasworth US$3.5 billion in 2010 and is expected to generate revenues of US$24 billionin 2015.Messaging will continue to see strong growth as a mobile advertising medium overthe next five years, simply because it is the best mobile medium for mass-marketcampaigns.However, mobile display advertising using banner ads will see stronger growth andovertake ad spending on messaging in many markets by 2011-12.Successful companies with unique and attractive technology and solutions formobile advertising, mobile location, social networking and personalization arebecoming attractive acquisition targets for the likes of Google, Apple, Nokia andYahoo.The fragmentation in the mobile advertising market looks unlikely to reduceanytime soon, and in fact may escalate due to possible anti-competitive practicesof Apple, Google and other big players. 21/04/2011 19 ©Confidential
  20. 20. Thank you For more information Make better business decisions