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2011 US Mobile Marketing Predictions


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2011 US Mobile Marketing Predictions

  1. 1. Headquarters Forrester Research, Inc., 400 Technology Square, Cambridge, MA 02139 USA Tel: +1 617.613.6000 • Fax: +1 617.613.5000 • For Interactive Marketing Professionals Executive Summary After a record year for mobile marketing spend and success, mobile has finally arrived as a legitimate marketing medium. In 2011, Forrester predicts that marketers will take the training wheels off mobile programs and start investing in cohesive mobile marketing strategies. Designated interactive marketers will become the first set of true mobile marketers, creating specific mobile search and display media buying plans, while scrutinizing one-offs like campaign-based apps will for providing additive business value. Location-aware services will remain in testing as the market continues to innovate and marketers find value propositions that drive more consumer adoption. Despite increasing activity and more strategic spending, inconsistent data and analytics will plague mobile marketers hoping to make a business case for testing emerging opportunities. 2010: Mobile Marketing sees a surge of interest More than one-third (34%) of interactive marketers are currently implementing or are planning to implement a mobile program.1 Mobile marketers are building on the successes they have seen and experienced from 2010. Mobile is poised for major investment in 2011 because: · Case studies expose a healthy marketing channel. Scores of companies reported that early tests yielded high click-through rates, two-to-one ROI, and even some examples of significant mCommerce sales. For example, Roy’s Restaurant earned 800% ROI with a mobile-only Google AdWords campaign using targeting based on location.2 Jason Maloney, vice president of marketing for Roy’s said, “Our hyperlocal, mobile-only campaign drove a 40% increase in calls with a CPC 67% less than desktop ads. The numbers are impossible to ignore. We have to invest in hyperlocal mobile advertising as part of our long-term growth strategy.”3 · Innovations have gained traction. Unlike the early days of Internet marketing, which started from nothing, there are interactive vendors and human capital with relevant experience that applies directly to mobile. The combination of this relevant experience and preexisting consumer audience sets a faster pace of innovation and implementation than anything seen in PC marketing. Location- based social networks are a great example of something few marketers or consumers had heard of a year ago but that big advertisers like Starbucks, McDonald’s, and Gap have already implemented on campaigns.4 Look for more marketing innovations to emerge from technologies like mobile couponing, barcodes, and augmented reality. January 4, 2011 | Updated: January 18, 2011 2011 US Mobile Marketing Predictions by Melissa Parrish with Sarah Glass, Emily Riley, and Jennifer Wise
  2. 2. © 2011, Forrester Research, Inc. Reproduction ProhibitedJanuary 4, 2011 22011 US Mobile Marketing Predictions For Interactive Marketing Professionals · Consumer mobile usage is skyrocketing. Smartphones have fundamentally changed consumers’ mobile behavior, exposing them to a broad range of media channels — like email, Internet browsing, and apps — to engage with right from their pockets. The brisk consumer adoption rates of these media devices have changed the mobile marketing ecosystem as well and will continue to do so by adding more marketing opportunities and greater reach year after year.5 2011: Mobile Marketing Gains A Strategic Position In The Marketing Mix Armed with case studies, new innovations, and a built-in audience, marketers will have more confidence than ever to kick-start mobile programs in 2011. Forrester predicts that: · Marketers will become app-athetic. Branded apps were certainly big news stories in 2010, but consumers aren’t impressed with apps that provide little utility and only clutter up their phone decks. Research suggests that though people download apps, many of these apps are deleted soon after download or are never used again.6 As marketers wake up to consumers’ propensity to ignore apps soon after download, they will question the ROI of their app investments. Lightly engaging games, high-utility apps like The Weather Channel, and navigation apps will continue to live natively on mobile devices while branded apps that don’t provide a reason to return will fall off. What it means: The success metric for apps in 2011 will not be number of downloads but number of active users. Though the rate of new, purely campaign-based apps will continue to grow, smart marketers will realize the minimal value they provide customers, the infrequent repeat use, and the high cost to produce and market them.7 In order to develop better mobile experiences, marketers need to deliver on the unique value of mobile: immediacy, context, and simplicity.8 · Mobile Web search and display get the most resources. While never a “shiny object,” Google actually accounts for 59% of all mobile advertising revenue in the US with a majority of that revenue coming from mobile Web search and display. As marketers and industry realize the glaring mindshare gap between apps and traditional tactics, a rhetoric change will occur with a greater focus on how to optimize existing search and display resources for mobile. What it means: You’ll perform best if you consider how your customers use mobile devices before you allocate your mobile dollars. On average, consumers use the mobile Web and apps equally, but they only use a limited number of apps such as for gaming, weather, and sports. For marketers who want to draw a larger swath of users, mobile Web search and display are valuable tools to consider. · Mobile marketing will emerge from interactive marketing. With mobile marketing purchase processes and strategy decisions strongly mirroring digital methods, mobile headcount has so far existed within current marketing teams. These resources are masters first in marketing methods like search or display marketing with minimal experience in mobile. As mobile | Updated: January 18, 2011
  3. 3. © 2011, Forrester Research, Inc. Reproduction ProhibitedJanuary 4, 2011 32011 US Mobile Marketing Predictions For Interactive Marketing Professionals demands more time and responsibility, these resources will seek out opportunities to connect with other people who are also learning their way through this new marketing form and starting to form unique skill sets, departments, and vendor relationships. What it means: Establish formal or informal knowledge groups to kick-start necessary cross- functional communication. To do this, identify and connect the mobile resources throughout your organization. This will allow for faster knowledge transfers and establishment of best practices. · Email marketers will become mobile converts. In 2011, expect the addition of SMS and MMS to connection points like Facebook and eBuddy. The mobile inbox already aggregates channels like traditional email, Facebook email, and text messages. Direct marketers will centralize their budgets in mobile to account for message aggregation and spend more on “right channel” technologies from companies like Epsilon and Unica. What it means: More than one-third of US online adults who own cell phones (36%) already use them to send or receive email. 9 Email marketers must adapt by implementing standards like providing a mobile-friendly preview format that’s accessible with one click. As new inboxes develop, look to your email service providers and SMS vendors to create new formats that function across PC, tablet, and mobile devices. · Lack of mobile advertising standards restrains growth in analytics and distribution. There are myriad technology issues that make distributing and tracking display ads on mobile devices difficult.10 Organizations like the Mobile Marketing Association (MMA) and the Interactive Advertising Bureau (IAB) will introduce standards, but don’t expect immediate adoption of these standards by agencies, ad networks, or analytics providers. This will affect marketers who want to run broad reach campaigns in the lurch as they struggle to work with multiple vendors and prove the value of their spend. What it means: You will have to be creative with data to prove the value of your mobile program and secure future investment. Keep your analytics simple in 2011. Use one channel, one strategy, and as few ad networks as possible at a time. Doing this will help you learn the technical limitations of each tactic as well as how to best translate limited data into meaningful insights. · Marketers will continue to look for the magic location-based service. Marketers will start investing in a wide array of location-aware mobile services in 2011. Innovations in technologies like triggered push notifications, augmented reality, and barcode apps/readers will evolve and increase consumer adoption. Consumer adoption will be limited, however. Opt-in services and applications that have clear and agreeable privacy policies will find the most traction, while marketing that is pushy or insensitive to consumer concerns over location sharing will stall adoption of location-based marketing. | Updated: January 18, 2011
  4. 4. © 2011, Forrester Research, Inc. Reproduction ProhibitedJanuary 4, 2011 42011 US Mobile Marketing Predictions For Interactive Marketing Professionals What it means: Location-aware services are one of the biggest promises mobile can and will deliver to marketers. But they are also prone to backlash as the privacy debate remains top of mind among legislatures, the FTC, and the entire digital marketing community. To avoid missteps, focus on services that offer a true value-add to customers, test small, fail early, and lean toward services that are opt-in. It’s one thing to run a bad campaign; It’s another to lose the trust of your customers. R ec o mme n d ati o n s 2011 new year’s resolution: create a mobile marketing strategy If 2010 was the year marketers tested mobile, 2011 will be the year marketers take a serious look at what they — and their competitors — have learned and make steps toward creating cohesive mobile strategies. To do this quickly and effectively, Forrester recommends that marketers apply the POST methodology to your mobile marketing: · People. Asking yourself who your target audience is and how they use their mobile phones will provide necessary clarity for the rest of the POST process. Forrester has developed a Mobile Technographics® ladder to help you characterize your customers and see how they differ from the general population.11 · Objectives. Start with your overall marketing objective: What do you want to accomplish with this marketing program? Are you conducting customer acquisition campaigns or brand awareness? Do you want to increase sales? Once you have established your overall objective, ask yourself how mobile can support your larger goals. · Strategy. Once you define your goal, you have to create a plan for how to accomplish it. This plan is your strategy. Types of questions you want to answer here are: What is my budget? What resources exist today? What resources will I need to execute this new vision? · Technology. Technology decisions are made last, not first, so you have all the inputs to make an informed decision. There are a number of technology options in mobile, and too often people choose a technology that doesn’t suit their consumers. For example, if your customers search, what types of content are they looking for? You can add a number of elements to paid search advertisements such as coupons, directions, and click-to-call links, but you should only add features if they deliver value toward your stated objective. Supplemental MATERIAL Methodology Forrester fielded its May 2010 US Interactive Marketing Online Survey to 309 interactive marketing professionals. For quality assurance, panelists are required to provide contact information and answer basic questions about their firms’ revenue and budgets. | Updated: January 18, 2011
  5. 5. © 2011, Forrester Research, Inc. Reproduction ProhibitedJanuary 4, 2011 52011 US Mobile Marketing Predictions For Interactive Marketing Professionals Forrester fielded the survey in May 2010. Exact sample sizes are provided in this report on a question-by-question basis. Panels are not guaranteed to be representative of the population. Unless otherwise noted, statistical data is intended to be used for descriptive and not inferential purposes. If you’re interested in joining one of Forrester’s research panels, you may visit us at http://Forrester. com/Panel. Forrester conducted an online survey fielded in April 2010 of 26,913 US online users ages 18 to 88. For results based on a randomly chosen sample of this size (N = 26,913), there is 95% confidence that the results have a statistical precision of plus or minus 1.4% of what they would be if the entire population of US online individuals ages 18 and older had been surveyed. Forrester weighted the data by age, gender, income, broadband adoption, and region to demographically represent the adult US online population. The survey sample size, when weighted, was 26,749. (Note: Weighted sample sizes can be different from the actual number of respondents to account for individuals generally underrepresented in online panels.) Please note that this was an online survey. Respondents who participate in online surveys have in general more experience with the Internet and feel more comfortable transacting online. The data is weighted to be representative for the total online population on the weighting targets mentioned, but this sample bias may produce results that differ from Forrester’s offline benchmark survey. The sample was drawn from members of MarketTools’ online panel, and respondents were motivated by receiving points that could be redeemed for a reward. The sample provided by MarketTools is not a random sample. While individuals have been randomly sampled from MarketTools’ panel for this particular survey, they have previously chosen to take part in the MarketTools online panel. Endnotes 1 Source: May 2010 US Interactive Marketing Online Survey. 2 Hyperlocal advertising targets consumers with ads based on a defined proximity. It’s also called geolocation advertising and location-based advertising. 3 More about Roy’s success with hyperlocal mobile marketing can be found on the Google Mobile Ads Blog. Source: “Roy’s Restaurants achieves 800% ROI with mobile only campaigns and hyperlocal advertising,” Google Mobile Ads Blog, December 8, 2010 ( achieves-800-roi-with.html). 4 Though consumer adoption of location-based social networks is still small, with only 4% of the US online population having ever used them, marketers see a great opportunity. To learn more about these networks and the consumers who use them, see the July 26, 2010, “Location-Based Social Networks: A Hint Of Mobile Engagement Emerges” report. 5 To learn more about how consumer adoption of smartphones is changing user behavior, see the January 19, 2010, “Engaging Smartphone Users” report. | Updated: January 18, 2011 „ LinkTitle Link Author
  6. 6. 62011 US Mobile Marketing Predictions For Interactive Marketing Professionals Forrester Research, Inc. (Nasdaq: FORR) is an independent research company that provides pragmatic and forward-thinking advice to global leaders in business and technology. Forrester works with professionals in 19 key roles at major companies providing proprietary research, customer insight, consulting, events, and peer-to-peer executive programs. For more than 27 years, Forrester has been making IT, marketing, and technology industry leaders successful every day. For more information, visit ©2011ForresterResearch,Inc.Allrightsreserved.Forrester,ForresterWave,RoleView,Technographics,TechRankings,andTotalEconomicImpactaretrademarks of Forrester Research, Inc. All other trademarks are the property of their respective owners. Reproduction or sharing of this content in any form without prior written permission is strictly prohibited. To purchase reprints of this document, please email For additional reproduction and usage information, see Forrester’s Citation Policy located at Information is based on best available resources. Opinions reflect judgment at the time and are subject to change. 58425 6 Data from Pinch Media shows that on average, apps usage drops precipitously after download. Source: Zach Spear, “Average iPhone app usage declines rapidly after first download,” AppleInsider, February 19, 2009 ( downloads.html). 7 Apps that provide engaging experiences and encourage frequent use take a strong strategy and clear vision to produce. If you’re a marketer who’s considering creating an app, please see the April 9, 2009, “The POST Method: A Systematic Approach To Mobile Strategy” report. 8 Mobile represents a fantastic opportunity for marketers, but nonstrategic applications that offer no value have left many mobile users unimpressed at best and frustrated with brands at worst. To learn how mobile can add value to your brand, see the October 18, 2010, “Mobile Adds New Appeal To Your Brand Experience” report. 9 Source: North American Technographics® Online Benchmark Survey, Q2 2010 (US). 10 Major tracking issues include multiple software development units (SDKs), transcoders that strip tracking mechanisms, and inability to store cookies on mobile devices. 11 To learn about mobile Technographics segmentation, see the September 28, 2010 “US Mobile Technographics®: 2010” report.