The Mobile Gap: The Disconnect Between Mobile Behavior And Ad Spending
Columnist James Green believes mobile ad spending needs to catch up with the rise of mobile innovations and consumers' mobile behavior.
It’s no surprise that mobile usage is growing by leaps and bounds, but today’s ad spending doesn’t necessarily match up with the amount of time consumers spend on their devices.
Mobile commerce is expected to reach $245 million by 2017, but we are still living in an era where desktop takes a majority of the ad dollars.
People today already spend a majority of their time on mobile devices, with a daily average of three hours and eight minutes compared with two hours and 11 minutes on desktops, according to eMarketer.
Additionally, comScore has reported that smartphones and tablets account for 62 percent of time spent with digital media. However, there is still a gap between mobile spending and mobile usage.
One reason stems from publishers — some argue that technical challenges like the low number of ads mobile users can view, the low performance of banners on mobile and the difficulty of tracking are preventing them from making the most of this channel.
And for marketers, the uncertainty of the platform has some sitting back and waiting to see how its ROI (return on investment) delivers over the coming months before putting more budget behind it.
On the other hand, large companies like Google and Facebook are seeing mobile ad dollars catch up with desktop, and they’ve successfully managed to ride the mobile wave as handheld devices become more mainstream for consumers.
Regardless of the market dynamics, we’re reaching a time where mobile spending should be more aligned with mobile behavior.
More Innovations Are Mobile-Enabled
The mobile category is quickly expanding with innovations in wearables and smart cars. For instance, Tesla’s Elon Musk has asserted that the carmaker will produce a fully autonomous vehicle within two years, creating a platform for brands to connect with consumers literally on the go.
And companies like Periscope and GoPro are making inroads into live streaming, providing brands with the opportunity to create real-time content for consumers across devices.
Malls and big-box retailers are investing in beacons, delivering timely and relevant ads to consumers as they shop in-store. Tools like Apple Pay allow consumers to purchase from their devices, and smart-home systems like Nest can enable energy conservation.
Mobile innovations span sectors, making it a top priority for marketers regardless of their industry.
Mobile Drives Sales And Loyalty, Maybe More Than Desktop
Brand loyalty has become more widely discussed in the last few years with the adoption of mobile and the increase in personalized, 1:1 marketing. Nielsen data shows that people spend more than 30 hours a month using apps, a number that has jumped about 65 percent in the last two years.
Mobile apps allow brands to really understand their customer as an individual, and in many ways, mobile devices have replaced loyalty cards. Brands have sweetened the deal for consumers by providing more personalization and relevant real-time offers than ever before, and this level of customer experience is not one that can easily be done on desktop devices.
By taking advantage of the data available on mobile, there’s also a greater opportunity to drive in-store sales and capture people in exactly the right moment. The desktop will always have the advantage of being the bigger screen, but new advancements in handheld devices, the time spent on mobile and the intimacy of the app world will give the desktop some real competition.
Never Underestimate The Power Of User Experience
Omni-channel starts with the customer experience, and it has become a much larger focus for brands since the rise of mobile. This year, 54 percent of consumers conducted some purchase behavior — searching, researching, buying — on a smartphone or tablet, and nearly a quarter of millennials used multiple devices to make purchases.
Not only do brands need to be targeting consumers in a personal and timely manner, but they face the added pressure of offering the same personalized user experience across desktops, tablets and mobile devices.
Omni-channel extends to in-store experiences, as well, since 84 percent of smartphone shoppers use their phones while in a physical store — and if a retailer’s site or app is slow, one-third of smartphone users will immediately switch to another site.
Omni-channel is all about bringing devices and in-store and digital channels together so that people have a holistic, consistent experience. This means everything from customer service to the way consumers can look at products, gather information and ultimately make their purchases.
The more brands improve their omni-channel strategies, the greater the consumers’ expectations. Companies like Whole Foods (from ordering groceries on the mobile app for pickup or delivery to seeing ads for Whole Foods products on your desktop and so on) and Bank of America are just two examples of brands that are starting to set the bar rather high.
Different companies have responded to mobile opportunities at different speeds, but there’s still a rather large gap between consumer behavior and how brands are choosing to spend their budgets. Being present across devices and having a mobile strategy is not only a “nice-to-have,” it’s now becoming an expectation.