The Billions In Mobile Ad Money Nobody Can Grab

jfruh writes "Here's a pressing mystery: despite users spending an increasing amount on their mobile phones, mobiile advertising only produces 20% of the revenues per page that web advertising does. This seems like a big opportunity for somebody, but a whole complex of reasons might mean that it isn't just a matter of someone being smart enough to do mobile ads right. The whole advertising industry, which in many ways still resembles the Mad Men-era old boy's network, simply may not be equipped to cope."

Comments

Cant be done "right".

[Kenja]

The screen real-estate on a mobile device is too tight for an add to be non-intrusive and simply piss people off. Annoyed customers are not paying customers.

Re:Cant be done "right".

[arisvega]

The screen real-estate on a mobile device is too tight ..

As is bandwidth. Which also tends to be ridiculously overpriced.

Re:Cant be done "right".

[guttentag]

The screen real-estate on a mobile device is too tight for an add to be non-intrusive and simply piss people off. Annoyed customers are not paying customers.

Exactly. I'd take it a step further and say that part of the reason mobile has been so successful is because there is less chance of running into annoying, intrusive ads. It succeeds because it gives the user what he wants.

If you accept that premise, the way to do mobile ads right would be to make up for the lack of real estate by providing something the user wants. Think time and location-based ads that offer something you can immediately use, like you're a block away from a McDonald's at lunch time and your phone shows an ad/coupon that saves you money on your lunch and drives business to the restaurant. Then 4 hours later, just as the chemicals in the food begin to liquefy your... Well, you know... You get a coupon for the drug store on the corner.

However, that will not/should not come to pass because if you allow advertisers to have that kind of information, they will exploit it and sell it (and by sell, I mean retain the information and sell a copy to anyone who wants it) until hundreds of companies you've never heard of know more about you than your wife/doctor/therapist/bartender/etc.

Re:Cant be done "right".

[epp_b]

Exactly right. Ad-supported programs only encourage me to search for alternatives that don't insult and annoy me. Especially annoying are the unskippable (or delayed-skip) video ads that appear before program startup or between program actions (ie.: Words with Friends, MixZing).

Listen up mobile software writers: the way to entice people to buy your software is to release a limited version for free and a full-featured version for sale with additional, useful features. But don't omit so many features that will cripple the free version into uselessness, that will only cause users to lose confidence in your software (ie.: if I buy the program, how can I be sure that these features work properly?)

It's called "the first taste is free" and it's one of the oldest tricks in marketing.

For example, I downloaded an volume levels program (I refuse to use the word "app" since Apple has doucherized the term) called AudioGuru which can set the various volume levels on the phone differently according to the time of day. The free version that I use has only a single daily schedule, the paid version can schedule varyingly according to the day of the week.

See? It's still useful, not annoying, but the additional features would make it more useful and convenient. I will try it for a little while and I may find that I forget to set the volume on days where the schedule would change.

Select the features you'll omit by balancing users' money with their time and convenience, not by annoying them (hint: ads are annoying).

There you go, developers, you can have this tip for free. Now, please stop pissing us off with your ad BS.

Re:Cant be done "right".

[DarkOx]

What you don't understand is they want the ad to stick in your mind. Granted if you are so aggravated that you might select a competitors product out of spite that is a problem; but for the most you answering that question, even in the negative means the ad worked!

They just got you to think consciously about the content of their ad enough for you to directly act on it. Most ads are more or less ignored. Before sn ad can accomplish anything else its got to get your attention. You answering the "was this relevant" question at all proves they did that much. The nature of the question requiring to think about what you just watched increases the likelihood you will remember it later as well, another win.

Re:Cant be done "right".

[a90Tj2P7]

Hulu could stand to learn from this. In general their ads are just what they are, but they always have that "Is this ad relevant to you?" thing up in the corner. There's some ads that I dislike, so much, I actually take the effort to click no on. Surprisingly I then continue to see those ads over and over again.

Why would that be surprising? It's long-term marketing feedback, no one is going to look at that until the ad campaign is over or up for renewal. It's for the benefit of Hulu/the advertisers, so they can correlate future ad campaigns to demographics and usage, not for you to opt out of or vote away an existing ad. Hulu has sold to Company A that Ad B to be played during Term C for Target Audience D, so Ad B will continue to be played under those conditions until Term C is over. That vote against the ad isn't going to count until they're planning their next ad campaign.

Re:Cant be done "right".

[steelfood]

On the desktop, you pay for the connection, but there's no limit to how much you can download (outside of the max bandwidth x time calculation). In that case, the price of advertising is fairly cheap to the consumer.

On the phone, you're paying by the bit. This means even the extra text that gets sent across the air to your phone is costing you money. That cost becomes fairly significant when you're receiving flash or HTML5 ads with animation and video and whatnot.

The answer to why mobile advertising remains largely untapped is fairly obvious: it directly impacts the customer's wallet.

Mobile ads are a waste of time, space, and money.

[JustAnotherIdiot]

Be honest those of you who have a smart phone, when is the last time you saw an ad on it and seriously thought about even clicking it, much less spending money on what was shown?

Acceptable Ads

[SJHillman]

Acceptable Mobile Ads: Takes up the edge of the screen (or otherwise unused area), is not distracting (flashing, music, etc) and is primarily on pages/screens that I'm not going to spend a lot of time on, such as title screens, login screens, etc

The more an ad looks like content (as opposed to "attention grabbing", the more likely I am to pay attention to it. The more likely I am to pay attention to it, the more likely I am to click it if I'm interested. If your ad flashes yellow flying monkeys and blares music then I'm going to ignore it even if it's something I may be interested in. The advertising industry has taught us to tune out the annoying ads completely. Also, if an app has an ad splash screen (especially one that cannot be skipped), I will stop using that app altogether regardless of how well done, relevant, etc the ad itself is.

Re:Mobile ads are a waste of time, space, and mone

[Missing.Matter]

Advertising isn't always about getting you to buy a product then and there. While that's nice, it can be much more subtle than that. For instance I've never seen a TV ad for mouth wash and rushed out to the store right after to buy some. But the next time I did actually want to buy mouthwash, I went to the grocery store and was confronted with about half a dozen brands. Which one do I buy? Well, probably the one that is more familiar to me, the one I have seen advertised the most.

Re:Mobile=death of traditional advertising

[DogDude]

That's only if everybody decides to read web pages exclusively from mobile gadgets. That's not likely to happen.

The trouble with advertising on smartphones

[Animats]

There's the screen real estate problem, of course. More important, though, is the business model. Phones are sold to carriers. They make their money from service charges. They don't need ads. They'd rather have paid services be paid for through them.

How exactly do they know?

[AdrianKemp]

Okay, so desktops get x clicks/1000 views, and because mobile devices get 0.2(x)/1000 views I'm supposed to believe that there is money there waiting to be grabbed?

Bullshit.

The use patterns on phones and tablets is fundamentally different than on a desktop. There is absolutely no reason to assume that the advertising done (no matter how) will provide the same results.

note: I'm not attempting to state that the money definitively isn't there, but comparing clicks between two completely different formats is hardly proof that there is.

Unwanted

[sqrt(2)]

Advertising is unwanted, and intended to mislead. It is especially obnoxious on a platform that costs a lot of money and has a small screen. Phones and plans are expensive and then on top of that you tell people they are going to see ads? They're not going to be happy. I especially hate efforts to spy on me in order to increase the effectiveness of ads that I don't want to see for products I don't want.

Moreover, I find *ALL* advertising to be annoying and unwanted, the more custom tailored it is to me the more offensive I find it. Also, advertising seems to operate under the assumption that people have money to spend. Tell me, how is an advertising based economy going to work when every year more and more people are unemployed? I don't care how targeted and relevant your ads are, people without jobs aren't going to buy your product/service.

The advertising economy is headed for a huge crash, and mobile is just an especially obvious example. It's a scam, top to bottom.