The next 12 months will mark the start of a sharp upturn in mobile advertising spend as the proliferation of cheap, high-quality multimedia handsets and the widespread availability of high-speed mobile networks reaches a critical point, according to a major strategic report released today by Informa Telecoms & Media.
The study, entitled "Mobile Advertising Services: generating revenue through subsidised content" predicts that worldwide spend on mobile advertising will rise to US$11.35 billion within five years.
The potential economies of scale that the mobile channel offers advertisers will prove a powerful draw – Informa Telecoms & Media forecasts that there will be over 2.1 billion mobile subscribers worldwide by the end of 2006, rising to nearly 4 billion in 2011. Issues that need addressing to enable advertisers to realise this reach however, include consumer acceptance, technology (screen size, available bandwidth, interoperability between operators and handsets) and industry regulation.
Major advertisers such as Coca-Cola, and car manufacturer Peugeot have been experimenting with SMS and WAP based advertising since 2002/3 and 2004 respectively. In 2007, mobile advertising spend will more than double from 2006 levels to over US$1.5bn.
Brands are clearly eager to take advantage of the intimacy of contact that mobile advertising promises; with information available to operators it is theoretically possible to create very targeted campaigns. The mobile is also a useful tool to track and measure the success of campaigns, with users texting, calling in or clicking on links all giving direct feedback on the effectiveness of a campaign. Gaining access to customer information from operator customer service records could prove complex however, both from a technical perspective and due to regulation governing the use of customer data.