- Category: December 2010
Mobile Marketing Association’s new Chief Executive Officer, Greg Stuart, was recently in Singapore, and Asian e-Marketing interviewed him, together with our well-known expert on the Asian mobile scene, Rohit Dadwal, MMA’s Managing Director for Asia Pacific.
Having received some fresh results that day from a survey conducted by InMobi in partnership with comScore, which revealed a surprisingly high level of mobile advertising acceptance in Asian markets, I couldn’t resist making use of this opportunity to ask these high-profile interviewees questions about the good news for mobile advertisers - especially as we know the region’s potential still seems to be virtually untapped.
Q: According to the recent study, almost 70 % of Asians were comfortable with mobile advertising and more than 50% were ready for customised/personalised advertising. Could you give me your thoughts on why that probably is so?
Rohit Dadwal: That is because the nature of the device being personal, targeted and actually providing you with information at the contextual time and place that you want, is what consumers want. Many Asian consumers actually have not had that Marketing 101 experience, simply because the addresses and postal codes were not always there. There is also a social/economic factor: it barely costs you anything to get information and you don’t want to be left out of information you had never had access to earlier. From a business point of view, marketers are now all of a sudden finding new users they couldn’t talk to earlier and are trying to send personalized and targeted messages to their new audience by using new media. It is now, for instance, possible to send you a message saying “Daniela, you are on Duxton Road, would you want to have a beer on your way back home?” which is location based marketing and much more appealing to consumers as its relevance really generates interest.
Greg Stuart: Indeed, the mobile phone presents a new opportunity for marketers to communicate to consumers and the fact that it has location and proximity provides a whole new dimension. Today’s consumers, at a very basic level, understand there is a quid pro quo. They are used to being exposed to ads, if they get free content or free media in return. As long as media doesn’t start to do stuff that is offensive, intrusive, or irritating, they are in general OK with the concept.
Q: In accordance with the research which states that around 50% of mobile users in Asia seem to be willing to receive advertising in return for free apps or a lower phone bill, do you think that this is the business model of the future? That it is the way to go for the mobile advertising industry in the region and globally?
Rohit Dadwal: That number actually points to the economic and demographic frame of the markets that we are in, which is huge and as much as 15% of the household income can be spent on a mobile phone and services in most of these markets. That eats into education, health care and food and maybe even housing a little bit. If that can be supplemented with free ads that can reduce the cost from say 15% to 12%, why would you not want it? Remember, these are the masses who are the next one billion customers. If they can reduce their cost by 2%, by receiving free advertisements, they will do it. Consumers want advertising on a medium like mobile, because it becomes targeted and personal. They get more relevant information, which is not a spill-over from a brand’s perspective. However, it also becomes more risky, because if you start sending something which is not truly personalized - it may turn people off. In the Internet business it was pop ups that clearly were wrong for the industry and we will step in to work to stop offensive pop ups that annoy consumers on their mobiles as we think it is bad for consumer experience, too.
Greg Stuart: For emerging markets this will definitely play a more active role as we move forward, and we have not even explored voice advertising yet. Mobile is and was actually meant for voice and all these things that we are talking about are additional services. We have not even touched voice advertising, yet. If listening to jingles can reduce the cost of my phone call to almost zero, I will want that. And probably my jingle already knows who I am and knows from a demographic perspective what segment I am in. Thus, customers will feel less disturbed due to more relevance. How brands start tailoring their messages and communication strategies must become very specific.
Q: Given that the Asian consumers are receptive to mobile ads, there is great potential for growth in the market here. What impact do you expect will it have on the operations and expectations of MMA?
Rohit Dadwal: More people at the table means more resources for the MMA to do more work to help develop that market place. It makes it a much more exciting, much more vibrant place. With our growing industry there is reason to believe there should be some kind of regulation in that field, be it self-regulated or enforced. Regulation requires wise guidance and that’s really what we are doing. We are helping build a framework under which the industry needs to work. We at MMA believe that it needs to be self-regulated; we believe all of our members will sign up with us and then adhere to the guidelines and practices that we are working on, the consumer best practices, the code of conduct, etc. We are also playing the role of quasi-consultant advisor to the regulators so that they understand that this is an industry which is growing and that there needs to be framework around the growth and enforcing the regulation as and when they have been framed. If you do not facilitate both ends of the industry which has at one end the regulators and the other end the consumers, there is the likelihood that one or the other may falter and that is not good for the industry. So you need to work at it from both sides. We also need to define what the consumers need to do, how they need to respect privacy for their own self. They need to be aware of what they can do to stop advertising, what they can do to entertain advertising, how they need to act based on that advertising, and so on and so forth; that it is not just the industry’s role. I think that collectively it’s both the regulator and the consumer who need to figure out how they interact with this and it will happen. We see ourselves as the facilitator to help make that happen.
Greg Stuart: Rohit makes the decisions for Asia Pacific that are appropriate for these markets because his dynamics are not going to be the same as in other markets. Part of my role is to figure out the consistency that we can bring to enable him to do more, more quickly and more efficiently. I think the lifecycle of the regions we operate in are quite different. Certain regions here are ahead of the curve and other markets lag behind. Therefore, we let the four regions do what is required to be done and then try and see similarities between all of them, so that we can actually have a global organization. What we are trying to do is to build a global medium for the increasingly global marketer.
Rohit Dadwal: I think it’s very true, mobile is a bigger deal here and there has been more development. It’s always good to keep an eye on what is happening in the other regions. There are developments in voice, for example, that are happening in Latin America and Africa that I am keeping a very close eye on to see how that could come to Asia. I am sure, that my counterparts in Europe or the US are doing the same.
Q: How do you expect mobile technology to evolve in the future and what impact can we expect it will have on the mobile marketing industry?
Greg Stuart: Mobile is now in the position where the consumers are driving growth and where technology is always trying to catch up. There are applications and services, like Foursquare, that are being built just for mobile phones. The success of this one simple app was not technology - it was the growth in usage by hundreds of millions of Foursquare users that is now helping drive innovation. So the question is how do you add location recognition to that? How do you add pictures to that? How do you add YouTube to that? The technology is now trying to catch up with what consumers want and consumers are now driving what the technological innovations will be. Who could have predicted something like Foursquare and what that means with all these new mash ups of other technologies used in new and different ways which are becoming really exciting? We need to start differentiating innovation from what is not innovation. If you say Foursquare is innovation then that’s wrong, that’s a service, that’s an HTML5 application service, which has been there for ten years. Well, it is not a technology innovation, but a new application of old stuff.
Rohit Dadwal: I am not sure, for instance, if it is right to compare search the way we understand it to what search will be on mobile. Mobile search is trying to emulate what search is on the Internet, but with definite variations - directory listings, content/location based search and so on. So is mobile search going to be the same to what it is on the Internet? I don’t think so, because it has already started fragmenting into different versions of directory versus location versus the traditional search versus Q&A searches. For example, you can actually do a search based on your camera, but will that become the biggest search tool as we move forward on the mobile? I am not sure. Will it be location based? Could be. Pairing reality with augmented location with content for mobile search, will that be the next killer app? Maybe. This it is not going to be the search that we know of, because this device has capabilities to take search to a whole new level compared to the PC.
Q: Considering that the mobile search market is still relatively immature, which of the services do you believe has the potential to become successful, and why?
Greg Stuart: I would look at just my own behavior and guess that at least 50% of the searches on my phone are proximity related or have an element of proximity. I am trying to find a restaurant or retail store that is near me, or I am trying to identify where I am or where I need to get to – I think it’s the vast majority of what I am trying to look for. It probably is higher than that (50%) when I think about it and that is a big change. In retail shops like Wal-Mart you could use your mobile phone for orientation to figure out where to find a product or get information on it. It’s all being driven on search and is being tagged into “If I am getting it here for this price, what is it sold for at Tesco and what will it be sold for at that other place?” That is search capability: scan the code, go into the Internet, browse it, find the cheapest price, and then go there and save $50.
Rohit Dadwal: I think there is a whole new layer of services that sort of get entered into here. We talked about Foursquare’s service but I know Procter & Gamble’s Olay did an application that works while you are standing in a retail aisle in front of their Olay products by providing a series of questions and answers that you go through to help identify which of their products is right for you. I don’t know if I would ever take the time to sit in front of my PC and identify a series of Olay products and then relate that to a retail experience, but if I am in the retail experience and I have the question and I have the need then and there to solve that, this is a big opportunity to do so. It feels to me like a very powerful idea and one that retail is not able to support yet, because there is no one within a pharmacy or drug store that really has the range of specific knowledge, in particular for Olay products. It’s a very powerful idea and that feels like search to me - it is a variation of a Google, but it is still definitely a search. Did you see that Google announced that they have over $1 billion dollars in mobile revenues? They did not qualify whether that was application, platform, or advertising. They just said mobile, without sorting out the income streams. So, it is a pretty big deal and certainly has got everyone’s attention, which makes it a pivotal moment for mobile.
By Daniela La Marca