Every year since 2005 has been dubbed "the year of mobile advertising" by some industry pundit. Yet, every subsequent Christmas finds the mobile ecosystem with nothing but a lump of coal in its advertising stocking. Part of the reason is plain old human inertia, says Mason Wiley, senior VP of marketing at cost-per-action advertising company Hydra.
"If you look at the percent share of advertising dollars that TV commands, it's a larger share of ad spending than the percent of time people spend watching TV; there's a disparity," Wiley says. "Online hasn't captured as much of the ad spending as you might expect from the amount of time people spend online."
"Even today, [advertisers] don't understand how much time people spend online," he says. "People — ad strategists in big companies — change behavior slowly. Technology evolves faster than marketers' brains do."
While Hydra's reach extends to direct marketing via search, e-mail, display and social media, aside from an exploratory project, the Beverly Hills, CA-based company doesn't currently include mobile advertising in its portfolio.
"Mobile hasn't performed for us yet," Wiley says. "We partnered with a publisher, one of the largest distributors of ad-supported games on iPhone. We generated clicks, but no conversions; we have to get an action to get paid. We had a high number of clicks — enough so we would have expected a number of conversions."
While this isn't unheard of in Hydra's regular channels, Wiley says, "In this case, we decided it was the technology, people's willingness to enter data via a phone, not the message. [That's] based on the fact that we were successful with the same messaging on other online channels."
One of the challenges for mobile advertising is the fact that the user experience depends on many factors that advertisers and networks don't control. "It's affected by purchasers' [equipment] decisions [and] the speed of the network," he says. "A lot of types of [mobile] ads depend on smartphones, and there are not near as many of these in people's hands as other phones."
Compounding the challenge in the United States is the lack of a standard user interface for mobile devices. "In Europe, they have a single standard," Wiley says. "Here, unless you have a smartphone to directly access the Internet, [the user interface] is a limited and proprietary mobile browser."
Wiley is optimistic that Apple's iPad slate computer as well as Google's initiatives in mobile advertising and municipal broadband will hasten market development. "When you have a big company like Google or Microsoft [enter the market], you know they're going to invest in developing it. But," he says, "Google can afford to buy a company like AdMob and not have it pay off right away."
So what does the online media advertising maven advise for the mobile channel? "Test it — you can't get data back without testing — and don't give up if the first test doesn't succeed. Every media has its unique capabilities and its limitations. What's great about phones is that people carry them when they're out and about."
