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HP exec: brands’ mobile spend will be up in 2010

December 3, 2009

HP on mobile

HP on mobile

Please click here to access the archived webinar, “Mobile Marketing in 2010: Up, Down or Flat?”

After a difficult 2009, brands will increase their mobile spend in 2010, according to a Hewlett-Packard executive.

During the hour-long webinar “Mobile Marketing in 2010: Up, Down or Flat?” hosted by Mobile Marketer and sponsored by mobile marketing firm HipCricket, six panelists discussed how they believe mobile marketing will fare in 2010 and shared tips for effective campaign planning and management. The webinar panel was moderated by Mobile Marketer’s Mickey Alam Khan.

“When gauging how must to invest in the mobile channel, we look at where we are as a company, where our customers are and where the marketplace and the technology are,” said Jay Dark, worldwide manager of mobile marketing at Hewlett-Packard, Palo Alto, CA. “As we look forward into 2010, we’ll be extending our mobile presence, with a focus on our mobile Web play.

“We’ve seen promising mobile Web numbers from our efforts to date,” he said. “We’re there to engage with our customers wherever they may be, and a mobile play is definitely a key to that.

“We simply want to be where are customers are, and more and more are mobile in both the consumer space and the b-to-b space, so we’ll be building out that mobile presence—in 2010 the focus in on making a compelling mobile Web experience in almost 200 countries worldwide.”

While many brands such as HP are ramping up their mobile initiatives, there are various challenges that must be addressed for mobile to continue on the up and up.

“Especially when you’re talking about a company like HP, which has thousands of marketing practitioners, for those of us that work in digital space, the message about the importance of mobile is clear and the future is clear, but many in other departments don’t have the opportunity to become a specialist in the mobile space,” Mr. Dark said.

“The benefits of mobile are obvious to everyone on this call, but when you say ‘Help me make these investment tradeoffs,’ that’s a challenge, so you have to specify the benefits mobile can provide,” he said. “From a brand perspective, an increasing percentage of marketing spend is shifting to digital, but as far as what percentage mobile should play, there’s not a set answer to that, because it depends on each brand’s campaign objective.

“At HP, it’s more about what are the opportunities mobile provides and how does that stack up to our opportunities in other areas.”

It is no secret that the recession took its toll on marketing budgets. However, savvy brands will continue to invest in mobile so that they are not left behind as the economy improves.

“2009 was a brutal year for marketing, and while I’m optimistic that as economy changes that will spill over to marketing space, currently marketing budgets are not expanding, they’re often flat and in some cases down,” Mr. Dark said. “To add something like mobile, you have to take something else away, which pushes for the need for better analytics to help us make those decisions.”

Other common complaints include fragmentation within the mobile industry and the long wait period required to get a common short code provisioned by all of the major carriers.

“Those of us in this space get enthralled with all of the latest and greatest trends and technologies, but one thing that has killed mobile marketing opportunities is the complexity of the ecosystem,” Mr. Dark said. “In the case of SMS, it still takes two-to-three months to launch a mobile campaign, where\as at HP we’re used to launch in a campaign in two-to-three weeks.

“On the media side, in terms of buying display ads, it’s not such a problem,” he said. “Text messaging provides brands with the ability to reach a large number of customers that have taken that activity and have made it very normal—SMS is at critical-mass state already, while the mobile Web continues to grow.

“It’s important to ask yourself ‘How will each channel integrate with mobile and interact with one another?’ and tie mobile into a 360-degree approach.”

Draftfcb Chicago’s MC Media
Beer giant Miller Coors, whose brands include Coors Light and Miller Light, is another brand investing heavily in mobile.

For example, this past season MillerCoors let baseball fans at U.S. Cellular Field pay tribute to their favorite stars in the stands, as well as on the field, during Chicago White Sox home games via mobile (see story).

In addition, MillerCoors’ Coors Light and reggaeton artist Daddy Yankee teamed up to promote the release of his new single “Grito Mundial,” and mobile was part of the marketing mix (see story).

As brands become aware of high-profile mobile case studies, it raises awareness and makes more brands and agencies comfortable enough to ramp up their mobile spend.

“We don’t see pushback at the level we did two or three years ago—now I think that  mobile usage has become very prevalent, ubiquitous even, a part of our daily life,” said Kim Luegers, director of media innovations at Draftfcb Chicago’s MC Media, an ad agency that represents MillerCoors. “Our clients are understanding that this is not a fad and that mobile is here and here to stay, especially clients with a younger target consumer base, say 18-34.

“We’re definitely seeing what mobile can bring to the table by connecting a brand’s message to the desired audience,” she said. “Brands get it that consumers are using mobile, but we as agencies need to take a better position to educate clients about the best ways to use mobile to reach consumers.

“Reach is the name of the game for big brands, and proving consumer usage is how we’ve realized success.”

So what will be the biggest areas of growth in the mobile space?

Nielsen recently estimated that the mobile Internet population is up to 60 million active users in the U.S. alone.

“I’m placing my bets on the mobile Web to really take off in 2010,” Ms. Lueger said. “With the proliferation of smartphones coming in, especially around the holidays, new Android devices, it’s becoming easier for consumers to log on and surf the information superhighway with their handset.

“I’m going with the mobile Web in 2010,” she said

The Weather Channel
The Weather Channel is an example of a publisher that has invested early and often in the mobile space, with a mobile Web site and applications for smartphones such as Apple’s iPhone, RIM’s BlackBerry and the Palm Pre.

This past June, The Weather Channel Interactive’s “Mobile Month” promotion yielded 28 percent higher mobile Web traffic during the mobile-centered campaign, breaking records for the site (see story).

“From TWC’s perspective, we’re seeing digital agencies investing more money and spending more time in the mobile marketplace,” said Craig Etheridge, vice president and national sales director at The Weather Channel and, Cobb County, GA. “However, there’s still the need to evangelize mobile marketing in all of its aspects and all it has to offer as a platform.

“The brands that got in early, we continue to see them to invest in mobile marketing with publishers such as TWC at higher and higher levels,” he said. “This year mobile advertising was somewhere around $450 or $460 million dollars, but we do expect to see exponential growth over the next three-to-five years.”

So what will be the biggest areas of growth in the mobile space in the coming year?

“We see mobile display ads and the mobile Web as being a hot ticket for 2010, because for the first time we’re starting to see that people aren’t accessing the Internet from PCs as much, they’re getting in via the mobile Web, which is a big change in how people access content,” Mr. Etheridge said.

“Mobile display is really going to take off even stronger next year, due to advances in technology and the proliferation of smartphones expanding what you’re able to do using a handset, which will provide a new creative element that hasn’t been seen before,” he said.

“Mobile local search also seems to be gaining a lot of traction among brands looking to reach consumers with messages when they’re out and about.”

HipCricket is a mobile marketing company whose clients include various TV and radio stations, Nestle, Jiffy Lube and HBO.

HBO Pay-Per-View used mobile to drive awareness and purchases of the Mayweather-Marquez fight, and to generate opt-ins for its mobile VIP club.

Consumers were asked to text PELEA to a short code for a chance to win a signed boxing glove and received an SMS message back inviting them to join the VIP club. An impressive 12.9 percent clicked through, and of them, nearly 70 percent opted into the club, giving HBO a valuable database for remarketing purposes (see story).

“I think that while the benefits of mobile are not yet seen as obvious across the board to brands and agencies, mobile is becoming a line item on their marketing budget, with brands such as Land Rover, Lufthansa, BMW and Pepsi all spending $1 million or more on mobile [each year],” said Eric Harber, president and chief operating officer of HipCricket, Kirkland, WA.

“The more successful case studies we share, the faster brands will ramp up their mobile spend,” he said. “Our sales pipeline is easily at its highest level ever.”

While business is good despite the recession, there is still plenty of room to grow.

“A recent survey we did showed that while 30 percent of consumers are interested in participating in a mobile customer loyalty program from a brand they trust, 80 percent said their favorite brands had yet to attempt a mobile campaign, which represents a great opportunity,” Mr. Harber said.

HipCricket advises brands to look at mobile marketing as a pyramid, with the channels with the largest reach at the bottom and narrowing to more niche audiences at the top. Mr. Harber advises starting with SMS, then proceeding to the mobile Web from there.

“Forming a mobile strategy and figuring out how mobile fits within the brand’s overall marketing mix is a key area,” Mr. Harber said. “Brands have an opportunity to harness the inherent power of mobile to weave it into their existing marketing strategy.

“Brands can get the reach they desire by tapping into the behavior of what people are already doing,” he said. “Text messaging is a great way to tap in to a large number of consumers, as it’s nearly ubiquitous, while mobile Web growing, as well as mobile apps and video.

“We also see opportunities to build databases for remartketing—for example, HBO and Macy’s have successfully opted in consumers for mobile engagement, resulting in brand uplift and real revenue.”

Interactive Advertising Bureau
The Interactive Advertising Bureau, known as the IAB, is an advertising business organization that develops industry standards, conducts research and provides legal support for the digital advertising industry, with an increasing focus on mobile.

“Many people really do get it and are starting to make mobile a part of their campaigns at early stages, but that’s not true across the board yet,” said Joe Laszlo, director of research at the Interactive Advertising Bureau, New York.

“There’s still a lot of room for growth here and a lot of folks still need to learn why there are big benefits to mobile.

“Mobile can be the glue that sticks the pieces of a multichannel campaign together, but it has to be part of the planning from the early stages and not just tacked on at the end,” he said. “The mobile Web is maybe the easiest aspect of mobile to get into, because it has a great balance of reach and richness, so it’s great place to start, and there are lots of different direction you can go from there.”

So what are some mobile trends to watch for in 2010?

“Location-aware apps, mobile couponing, as well as an interesting opportunity for mobile and local advertising to come together in new and dynamic ways in the coming years, and not just the corner grocery store, big national brands with local presences,” Mr. Laszlo said.

“When consumers looks for content on their phone, one of the most popular searches is for what’s nearby me or how do I get from point A to point B, so adding a localized advertising component is a lucrative opportunity,” he said. “It has the potential to get people advertising on mobile who may have not even advertised online.”

Up, up and away
When asked the question of the day—“Will mobile marketing in 2010 be up, down or flat?”—the six panelists came to a unanimous consensus: up.

“Mobile provides the unique opportunity to engage the consumer in a one-to-one dialogue,” said Laura Marriott, Denver, CO-based mobile consultant and former president of the Mobile Marketing Association. “Due to the always-on nature of mobile, and the fact that there are close to 3 billion mobile devices in hands of global consumers compared to 1 billion PCs, the opportunity to reach consumers on the go via mobile is enormous.

“The key for brands os to focus on building a comprehensive mobile strategy targeted to what consumers want and need, keeping in mind the brand goals and how mobile can help augment those,” she said. “Take advantage of the opportunity to clearly define your strategy and how mobile can help you achieve that via SMS, the mobile Web, apps or video.

“If you don’t do anything else next year, build a mobile Web site, because there’s nothing more disheartening for a consumer than trying to access a site that is not optimized for mobile.”

Brands should take note that it is no longer just teens and college students using mobile—everyone is doing it.

“We’re seeing a demographics shift from predominantly that 13-34 age range—it’s now skewing a little older,” Ms. Marriott said. “In terms of specific applications we’ll see more of in 2010, there will be a lot more location-based services and 2D bar codes as that technology continues to evolve.

“The bottom line is knowing  who your consumer is, what is the demographic of the consumer, what are their affinities or loyalties to your brand, what are you looking to do through the marketing campaign, whether it is to increase loyalty or sales and what is the best mobile tactic to effectively achieve that goal,” she said.

“Integrate a mobile call-to-action into all traditional and digital media and continue to engage consumers and maintain that dialogue by continuing to provide relevant and valuable information via the mobile channel.”

Please click here to access the archived webinar, “Mobile Marketing in 2010: Up, Down or Flat?”

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Dan Butcher is associate editor on Mobile Commerce Daily and Mobile Marketer. Reach him at

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