Like My Blog? Please click the like button and share it with your friends!

Custom Search

Thursday, May 13, 2010

Is it Time For Small Businesses to Focus on Mobile Marketing?

I've been reading a lot lately on the growing trend of mobile marketing. And I think it is a growing trend that is just now really starting to gain momentum and will explode within the next few years. This is due in part to the recovering economy and the growth of smartphone sales, but also because of some other drivers that I will talk about later in the article. I also believe that is an untapped or underutilized medium and marketing method for small businesses. But is it time for small businesses to focus on mobile marketing as a core marketing strategy and practice? Here is why I think every small business owner and manager needs to take a close look at mobile marketing and give serious consideration to adding it to their marketing strategy sooner rather than later.

What is Mobile Marketing

But first let's address the question of what mobile marketing is. Basically it is marketing on or with a mobile device. The Mobile Marketing Association says, "Mobile marketing is a set of practices that enables organizations to communicate and engage with their audience in an interactive and relevant manner though any mobile device or network." These devices are usually mobile phones, laptops, netbooks, iPads and the like and the networks are most always wireless networks like Verizon, Sprint or AT&T. Types and mechanisms of mobile marketing include SMS (Short Message Service) which are short codes sent via text messaging, MMS (Multimedia Message Service) which contain timed slide shows of text, images, video, and audio, In-game marketing, Mobile web marketing (websites that are designed specifically to be viewed on mobile phones), Bluetooth hotspots, Infrared waves (which are very limited in distance), Location-based services (sending advertising messages directly to consumers based on their current location), and User-controlled media which often requires users to initiate the contact and requires their express consent to receive future communications .

Mobile Marketing Practices/Tactics and Channels

There are many ways (practices or tactics) to execute mobile marketing. Mobile marketing mainly relies on three channels- mobile applications (apps), mobile messaging (SMS, MMS, and WAP) and mobile websites (websites specially designed and optimized for viewing on a mobile device) to deliver mobile content and advertising/messaging. Using SMS to send short text coupon codes which consumers can access on their mobile phones and present at check-out is a and great way to drive traffic to a business. And dedicated apps on mobile phones make getting marketing content to users fast, easy, and even fun.

Mobile Marketing Extends and Enhances other Marketing Practices

But mobile marketing can be executed through other channels not specifically designed or used for mobile marketing. For example, coupon codes can also be sent through email or posting on a website, even on social media sites. And just having a web presence alone can be a form of mobile marketing, because mobile phone users can access websites through their phone's web browsers. Being involved with social media and providing useful content such as business hours and location, products and services provided, customer reviews, pictures and video of products, the business, or staff, and everyone's favorite- deals and specials- is a way to be involved in mobile marketing.

So even though a practice or tactic isn't used solely for mobile marketing, it's use can be extended to mobile and serve a very useful function as a mobile marketing practice or tactic. Additionally, your marketing can often be enhanced with the ability to know where customers are and reward them for visiting your business (as with services that use GPS such as Foursquare) and to give them the ability to grab coupons and other deals off social media sites such as Twitter and Facebook, or off your website, to entice consumers who live in the area or who are in the area for other reasons (shopping, eating, running errands, working, commuting, or whatever) to stop in to your business and spend some money with you.

Smartphone Sales are Growing

The mobile phone industry analyst firm, Gartner, estimates that 172 million of the 1.2 billion mobile phones that were sold worldwide in 2009 were smartphones. ( And the research company Nielsen expects smartphone handsets to surpass feature handsets in the marketplace by the end of 2011. ( )

Here is a quote from a recent article on Nielsenwire with a link to a chart of past and projected sales growth:

"We are just at the beginning of a new wireless era where smartphones will become the standard device consumers will use to connect to friends, the internet and the world at large. The share of smartphones as a proportion of overall device sales has increased to 29% for phone purchasers in the last six months and 45% of respondents to a Nielsen survey indicated that their next device will be a smartphone. If we combine these intentional data points with falling prices and increasing capabilities of these devices along with an explosion of applications for devices, we are seeing the beginning of a groundswell. This increase will be so rapid, that by the end of 2011, Nielsen expects more smartphones in the U.S. market than feature phones." ( This link also contains a chart of past and projected smartphone and feature phone sales.

Increased Online Ad Spending

Advertisers are increasing their spending online to reach these mobile consumers- even small businesses. Several recent articles and sources have confirmed this. And while online Ad spending is still not on par with TV Ad spending, it is growing. MAGNA, an industry analyst firm and division of IPG's mediabrands, said in their Advertising Forecast released in April, 2010 that they expect online spending to reach 21.9% of all Ad expenditures by 2015.

WebVisible's latest State of Small Business Online Advertising for the 4th quarter of 2009 revealed these important things: 1) small businesses are increasing their online Ad spending, 2) small businesses are increasing in sophistication of online advertising, 3) as small businesses grow and have success, they spend at a higher rate on advertising (though that's really no surprise) and 4) even the smallest of businesses are finding that online techniques make a difference in their ability to reach local consumers. This last bit of information is exciting, because the key to most small businesses' success, particularly those that have very limited advertising budgets, is to effectively reach local customers.

Mobile Channel Adoption Surges and is Expected to Double in the Next 12 Months

Mobile channel adoption has been surging ahead by marketers. Marketing technology provider Unica , based on a recent survey, says that already one third of marketers are using some form of mobile marketing. Marketers in the Unica survey revealed that their adoption of the three major mobile channels will double in the next 12 months with the fastest growth coming from marketers using mobile websites and mobile applications. Mobile messaging is currently the most widely used mobile channel and will continue to grow but the other channels are expected to grow faster in proportion to messaging and will continue to grow in adoption rate and usage beyond the next 12 months. This is being fueled by the surging popularity of mobile devices such as smartphones and phones and other devices that use 3G. From Dec. 2008 to Dec. 2009 US mobile phone subscribers with unlimited data plans increased from 16% to 21% and several phones now require the purchase of these data plans when purchasing the phones. During the same time period, smartphone ownership increased from 11% to 17% while 3G phone ownership increased from 32% to 43%. (

Smartphone Owners Use their Phone's Smart Functions

Smartphone owners actually use the features of those devices. Consider these findings from Nielsen's Mobile Insight Survey:

"Smartphones show higher application usage than feature phones even at the basic built-in application level. During Nielsen's Mobile Insights survey we asked the respondents about features they've used in the last 30 days. The good news for the smartphone market is that people are actually taking advantage of the device capabilities."

"The percentage of people who use their phone for only voice communications drops from 14% among new feature phone owners to 3% of smartphone owners. The use of the built-in camera and video capability jumps by almost 20% for both categories, due to the generally better quality and user friendliness of the features. Smartphones also often have a better speaker which translates into more frequent usage from about half of feature phone owners to about two-thirds of smartphone owners. Not surprisingly the use of Wi-Fi increases 10-fold from 5% for feature phone owners to 50% for smartphone users to satisfy the need for fast downloads."

Technology, Social Media, and the Desire for Convenience are the Drivers

This is all being driven by technology (the lowered costs of online advertising, faster and more stable wireless networks such as 3G and 4G, the trackability of digital marketing, cheaper smartphone handsets, the rapid development and dissemination of apps, and the added and enhanced features of smartphones), social media (particularly geolocation tagging sites such as Foursquare and Gowalla) and consumers' desire for convenience (to be able to access information easily and quickly wherever they go). Gone are the days of needing to do your research on local restaurants, coffee shops, bars and nightclubs, retail outlets, or even auto repair shops, before you leave home or the office. Now it can all be done on the fly- whenever a consumer has a need or a desire for a product or service. Your wife calls you on your way home from work and tells you to stop by the store and pick-up milk and bread. No problem. You can use an app to find stores with deals and coupons for products. You're out with your family on the weekend doing some shopping and get hungry and need a kid friendly place to eat fast. Grab your phone and search Google to find a restaurant close by and check reviews and customer comments in the search results and on sites like Yelp or on social media. You can then check their website, your coupon app, and social media sites for discounts and deals to the restaurant(s) of your choice. And do it all on the go in just a matter of minutes. Just think about the implications this has for marketers to drive impulse shopping and market convenience goods and services!

Are You Ready?

When you take into account that with smartphones, apps, and social media services consumers now have the ability to search for nearby businesses on the go; access reviews on comments about those businesses; see information on the products and services of local businesses- even pictures and video; check-in with geolocation tagged services to earn badges, mayorships and real rewards from participating businesses; and download coupons to use in local businesses right on the spot, then mobile marketing makes sense for just about every kind of small business to use. For retail stores, restaurants, and cafes it is a no-brainer. Mobile marketing is an inexpensive, highly trackable, and surprisingly easy to use method of marketing. It puts even small retail stores and restaurants on a more even playing field with the chains and big box stores. And I think it is about to explode in popularity.

My answer to whether or not it is time for small businesses to focus on mobile marketing is a resounding yes. But each business will need to make that determination for themselves based on the type of business they are, the industry they are in, the customers they serve, and the resources available to them. As you make that decision keep in mind this question: are you going to be where your customers are and give them access to information about your business the way they want it, when they want it? Those that do now will be in an enviable position to those that don't when the inevitable mobile marketing explosion happens.

No comments:

Post a Comment