On the Grow?

We’ve all seen the usage statistics for mobile: More people using more advanced cellphone features — such as mobile Web and barcode scanners — more and more often during their day. A recent survey by the CTIA found that 91% of all Americans (285 million users) are mobile subscribers, and that 257 million of their devices are “data-capable,” including 50 million smartphones and 12 million 3G laptops.

So much for the demand side. But are marketers accelerating plans to supply those mobile users with ads, offers, branded content and other calls to action? Chief Marketer partnered with the Mobile Marketing Association to poll a population of marketers on their plans, for both this year and next, for campaigning over U.S. mobile devices. Fielded in mid-April and hosted online by Kinesis Survey Technologies, the poll is ongoing at press time.

Preliminary results from the first 500 responses strongly suggest that while mobile will remain a smaller portion of marketing budgets than categories such as online, TV and direct mail/catalog, it will double its share of the total U.S. marketing budget allocation. Mobile spending among marketers grew only 1.8% year over year in 2010 — basically a rounding error compared to the 29.8% allocated for online/interactive. But aggregate survey response says mobile’s share of 2011 U.S. marketing budgets will rise to more than 4% of total spend.

That makes mobile one of the few channels anticipating a spending increase in 2010-2011, and certainly the largest — a 124.4% boost in allocations, according to respondents, who said only events/trade shows, online/ interactive and TV would also see positive (much smaller) changes in their allotted spends.

Devices and Tactics

While iPhones and other smartphones make up a relatively small portion of the current user base, they’re attracting an outsize share of marketer attention (60%-65% of targeted campaigns) and will draw even more in 2011 (77%-86%), even as the number of marketers targeting “plain vanilla” feature phones drops off. Tablets like the iPad, netbooks and e-book readers should also see a big jump in mobile campaigns next year.

What marketing tactics in the mobile space are expected to see growth? Almost all of them, thanks to the law of small numbers. The largest increases will come in SMS messaging campaigns and Web site optimization for mobile (83% of respondents said they will do each of those in 2011). Interestingly, e-mail optimized for mobile reading will also see a 25-percentage-point jump to 66% by next year.

Respondents were asked to specify how many campaigns they will run in these channels in 2010 and to project those campaign counts for 2011. According to those results, the average marketer will run 319 SMS campaigns in 2010 and expects to run 770 next year.

Asked how much their spending on those mobile tactics will increase between 2010 and 2011, respondents’ answers did not track closely with the tactical question. This is probably because some of those tactical choices, such as optimizing sites for mobile, are already widely used. Other increases, such as the projected 141% hike in average spending on SMS, can be explained by simple volume increases in the size and number of campaigns.

On the other hand, marketers expecting to run campaigns using video or GPS or other complex phone functions and formats say they expect to encounter much higher average costs in 2011: 265% increases for location-based campaigns.

Deals and Diversions

In terms of the content offered in mobile campaigns, marketers say in 2011 they’re most likely to keep sticking with information, product alerts, and notices of special offers or sales — the same content that dominates mobile marketing now. But note the content that will see the biggest growth spurts from this year to the next: namely mobile coupons (up more than 27 points) and mobile applications (almost a 26-point jump). That suggests marketers expect to try to satisfy two divergent consumer wants from mobile marketing: the price savings of coupons, and the usefulness or engagement value of interactive apps.

Mobile has often been cited for the multiplier effect it can have on marketing campaigns and promotions running on other platforms; it’s the reason short codes crop up everywhere from TV spots to roadside billboards and in-store shelf talkers. But respondents to the MMA/ Chief Marketer survey overwhelmingly said they are much likely to integrate mobile with digital or online campaigns (67.5%) than with any offline channel. Trade shows/ events may get mobile-ized (41.6%), and over a third (37.7%) say they’re integrating mobile into retail or direct mail campaigns. But mobile integration with TV, print, radio and outdoor marketing hovers at around the 25% mark.

Finally, almost two thirds of those polled said they are now running or will run display ads specifically targeting mobile users. Use of banner ads and paid search will continue steady this year to next. The growth channel, they say, will be advertising in SMS, where the average number of campaigns will rise from three in 2010 to 8 in 2011.