Fixed Mobile Convergence

A recent study from Frost & Sullivan (News - Alert), which analyzes the U.S. mobile advertising and search market, finds that the market earned revenues of over $917.8 million in 2008 and estimates this to reach $2.8 billion in 2014.

The growth of mobile advertising and search market in the United States is driven by a number of factors including the increasing adoption of messaging, mobile Internet, mobile video, rich application and mobile search, as well as multitude of available data services, which can also be used to serve up mobile ads, Frost & Sullivan officials said.

Mobile advertising projects a unique and compelling value proposition that continues to generate strong interest from key stakeholders. New opportunities for monetization are opening up with rapid addition of new data subscribers and the increasing frequency of mobile data usage, the research agency finds. 

“The promise of delivering highly qualified and targeted ads on a more personal device and even taking it a step further by enabling commerce from within the same ad experience is too strong to ignore,” Frost & Sullivan Industry analyst Vikrant Gandhi said. 

Additionally, Gandhi said that the online experience makes the industry smarter, and many industry participants who initially disregarded the phenomenon find the early adopters managing to take up strategically important positions.

Mobile offers multiple channels for advertising, which can be leveraged to attain optimum effectiveness for the campaigns, Frost & Sullivan officials said. These innovative possibilities in mobile advertising make it a vital and attractive channel for advertising. New solution types such as an ad-mediation layer in mobile and third-party ad serving are also helping the industry.

All leading mobile operators such as Verizon (News - Alert) Wireless, AT&T, Sprint, Virgin Mobile USA, Boost Mobile, ALLTEL, Leap Wireless and others have deployed mobile advertising systems.

The biggest challenge for the mobile advertising industry is convincing the customers, particularly the advertisers and agencies, about the potential and capabilities of mobile advertising.

According to Frost & Sullivan, proper marketing techniques will be the ultimate deciding factor for success. Aspects including ease-of-use, comprehensive reporting and feedback, subscriber interaction mechanisms, integration with existing online ad platforms, and others are crucial for sustaining long-term growth.

“It may not be enough to simply implement new platforms and wait for the 'buy side' to come in,” Gandhi said. “The industry needs proactive measures to get more brands and agencies to include mobility as a core component of their marketing and advertising strategy.”

Mobile advertising is perceived as not being very measurable. Other negative views about mobile advertising are that it is cumbersome, spoils the user experience, and cannot tie into commerce. 

With dedicated participation from the industry, especially the content providers, mobile advertising can be made a 'self-sustaining' process to a large extent, say experts. Educational seminars on the industry, trial offers, strategic marketing through Webinars, and white papers are some suggested responses. 

“The requisite technical elements to facilitate mobile advertising are already in place, but the need of the hour is to ratchet up interest levels of advertisers to trigger market growth,” Frost & Sullivan officials said.