The year of mobile? Not yet, but there are signs of improvement
Spoiler alert: 2013 isn’t going to be the year of mobile. Sure, smartphone numbers keep going up and up and location-based technologies – the holy grail of mobile engagement – are more sophisticated now than they were during the debut of Foursquare et al.
But here we are, poised yet again to watch another year pass us by with the promise of mobile still unfulfilled in Canada – and a fair distance to go before we get there.
That’s not to say there has not been progress.
New solutions are being developed every day that leverage location-based technologies in new ways to deliver increasingly personalized (hyper-relevant, if you will) experiences to consumers.
There are startups, like Bellevue, Washington-based Point Inside, helping to enhance the bricks-and-mortar shopping experience by sending the location of products in-store and serving up advertising and content that’s contextually relevant to the aisle the consumer is in. There are companies, like New York-based Goldrun, facilitating augmented-reality location-based transactional experiences. Then there’s the potential of the data that can come out of engagement with said experiences. It’s a veritable goldmine for brands looking to up the relevance quotient of their efforts.
Some markets (like China and the U.S.) are a little further ahead than others (like Canada) in developing and implementing new location-based tech, but generally speaking, when it comes to brands realizing the potential of mobile, while they’re getting closer they just aren’t there yet. At least, not like they should be given how long the year of mobile conversation has been going on. So what’s the problem?
Well, there are undeniably some obstacles slowing the delivery of hyper-relevant branded mobile experiences to a snail’s pace.
Small budgets, particularly in the Canadian context, are a big impediment. Location-based technology isn’t cheap to develop or implement. And in Canada, it’s difficult for brands to justify spending the money to develop the necessary tech in a market so small.
“Often, it’s hard here to get the economies of scale for a good payoff,” says Curtis Priest, president and CEO of Toronto-based digital agency Pixelcarve, which has been investigating near field communication (NFC) technology of late.
There is also a prevailing reluctance amongst decision-makers to spend dollars on location-based techs that might, conceivably, turn out to be nothing more than a fad. Marketers are afraid of investing in something that will quickly become dated, therefore making their brand, at a certain point, feel equally as dated. That really comes out of a prevailing unwillingness on the part of marketers to be experimental. That challenge is amplified in Canada with our comparatively small budgets; marketers are more likely to go with programs that have a “tried, tested and true” methodology. You know, traditional advertising.
“We’re a little bit gun-shy about being the first ones to dive in in case it doesn’t work as well as it should, just in terms of the size of the market that we are,” says Priest.
“Global teams in larger markets are experimenting, testing and learning,” says Sean Weller, strategy director at Blast Radius, which has developed mobile solutions for both Canadian and international brands. “They want to scale to markets like Canada, but they need to refine the right formula and the right tech, find the right partners, fine tune it and then roll it out.”
Issues of budget, scale and distaste for experimentation aside, progress is hindered by other device-related obstacles like fragmentation—something Pixelcarve knows about firsthand with its foray into NFC tech. Some smartphones are NFC-capable whereas others, like the iPhone 5, are not.
Then there are differences in specs, like screen resolution. Looking at the web browsing experience on mobile devices, it just isn’t as advanced as it is on PCs.
And cookies, the essential component of effective online targeting for desktop browsers, just don’t have the same power in the mobile space.
“With cookies you can do a lot more targeting and all sorts of retargeting, and figure out pretty quickly what kind of messages people respond to,” says Todd Sherman, CMO at Point Inside. “That infrastructure doesn’t yet exist on mobile devices.”
Now, admittedly, all of the aforementioned obstacles do amount to a lot of doom and gloom, but we shouldn’t give up on mobile. Not yet.
EMarketer estimates that mobile ad spending in Canada, including display, search and messaging-based formats, will reach nearly $190 million in 2013, and rise to almost $700 million by 2016.
That would certainly indicate that marketers and advertisers have been changing their thinking when it comes to the significance of mobile in the overall ad mix. Olive Media’s Celeste Normington is seeing this change for herself.
“In early 2010/2011 we were looking at mobile and smartphone advertising as just another digital platform,” says Normington. “What everyone realized very quickly is that it’s a very different platform and you need to strategize differently about the way you advertise on it. We saw people actually take a step back last year to say, ‘Hey, this doesn’t seem to be working in the same way.’ ”
Also, people simply love their smart mobile devices. Despite regular complaints about relatively high data rates in Canada, smartphone penetration continues to increase at a rapid rate. According to comScore, smartphone penetration has reached 45% in Canada and over 50% in the U.S. Tablets are also becoming more commonplace. Ipsos Reid’s semi-annual “Mobil-ology” survey, released in January, found that tablet penetration in Canada almost doubled over the past year, now accounting for 21% of online adults.
A lot of that has to do with the fact that the technological infrastructure is improving at a dizzying pace, including the near ubiquity of wifi access.
Said comScore in its 2013 Mobile Future in Focus whitepaper: “The improved availability of high-speed internet access has significantly enhanced the average user’s media consumption experience, contributing to a rapid uptick in mobile media consumption… We have now crossed into the Brave New Digital World—a new paradigm of digital media fragmentation in which consumers are always connected.”
People’s privacy concerns are also becoming less problematic with concerns assuaged by programs that require opt-in participation to protect users’ location and ensure anonymity.
And, of course, more and more startups are popping up with new ways of leveraging location-based tech—that shining jewel in the mobile crown—to deliver next-gen platforms through which brands can serve uber-personal experiences to consumers hungry for more mobile relevance.
So, while 2013 (most likely) will not be the year of mobile, it doesn’t mean we shouldn’t be excited about the prospect of it happening eventually. Here are five examples of companies on the cutting edge of mobile waiting for the rest of the marketing world to catch up.
Indoor location-positioning targeting
This trend has relevant shopper marketing applications. The idea, essentially, is to increase customers’ basket sizes by making their shopping experience more efficient—the faster a shopper can find what they need, the more time they have to shop for other things.
By sending hyper-personalized and individually relevant deals and content based on shopping lists and habits as well as location in-store—accurate to within three feet—the shopper saves time in aisles and stores become easier to navigate.
Point Inside is a company on the forefront of indoor location-positioning targeting. It facilitates increased consumer engagement (and bigger baskets) for its retail clients (and advertising partners) by integrating its StoreMode technology into apps and enabling them to proactively engage with customers through their smartphones.
StoreMode uses location-based tech and store wifi networks to help shoppers find the products they want with indoor store maps and exact product locations, and engage them with personalized offers, coupons and other content based on their shopping lists (entered into the app), habits and location within the store. StoreMode helps retailers and their product partners improve their marketing through deep customer insights produced by leveraging behavioural data that tells them where, what and when to present to the customer.
That also helps Point Inside to optimize ads it can serve through its private ad network on behalf of its clients and their product partners.
“From the retailer side it’s kind of the ah-ha moment,” says Todd Sherman, CMO of Point Inside. “When retailers think about apps for their customers they tend to think in terms of e-commerce. The ah-ha moment is the realization that there’s a lot more happening in the store and if you can connect the customer with the actual physical store it drives a much better experience than just putting them on an e-commerce site while they’re standing inside of your store.”
Point Inside boasts major retailers like Meijer on its client roster and Sherman says his company has recently signed on two top 10 international retailers (whose names he was unable to divulge at press time) with a Canadian presence, thus, Point Inside’s tech will be available in Canada through their store apps. He adds that the company expects to be in more than 5,000 stores in the U.S. and Canada in the next six months.
There’s more! To read the full story, pick up the May 20 issue of Marketing, available now to subscribers on their iPads. This issue will also be available for free on newsstands at the Cannes Lions International Festival of Creativity.