The hype machine around mobile marketing and advertising rattles on, but it’s clear the channel presents huge opportunities for brands. The problem is many vendors continue to make big claims about their offerings, which are often unproven, and agencies and brands aren’t necessarily clued in enough to evaluate them thoroughly. As part of our Confessions series, Digiday caught up with a seasoned sales exec at a mobile marketing vendor to discuss the area further. You can read the full collection of Confessions.
Do brands and agencies know what they’re doing in mobile?
It’s amazing, the variation out there. There are actually some brands that are sharp and know their stuff pretty well, and there are a few agencies that know it even better. But that’s a small amount, probably 20 percent. Probably 40 percent or so sort of understand what’s going on, but then the remaining 40 percent will know only what they heard from a vendor a day before.
What does that mean for vendors?
From the sales side, we can see in the first meeting whether or not people know what they’re talking about, and where we could potentially make money. Sometimes that works in our favor, but as a whole I’d much rather have everybody good at mobile and helping to grow the pie. People that don’t know what they’re doing can easily be taken advantage of. There are ad network campaigns out there being sold at 80 or 90 percent margin because people don’t really know what they’re buying.
Is the growing raft of mobile vendors causing confusion among brands and agencies?
It’s a double-edged sword for the business. There is definitely confusion, and brands are hearing a lot of different stories from vendors. That makes it more complicated. It’s also challenging not having standards around a lot of these things. But on the other hand, if you didn’t have all those people out there creating buzz and hype, there probably wouldn’t be the ramp-up in spending we’re seeing.
How are agency approaches to mobile changing?
They’re investing in it now. They wouldn’t be growing their mobile teams unless they thought there was money there. For big agencies it’s still, to a certain extent, a bet on the future. But the future isn’t very far away — maybe 12 to 18 months. I am confident those agencies that aren’t very good at it will start to lose business now. It might not happen tomorrow, but it will happen sooner than people realize. If agencies think they can just move a couple of digital folks over to mobile, they’re wrong. That’s not how it’s going to work. You can’t just jump in to this area.
There’s a lot of hype around mobile. What’s the reality today?
The reality is there’s a lot of stuff that isn’t perfect about mobile. Anyone who says it is, is fooling themselves, or trying to raise money. But the good news is, everyone’s in on it. It’s not like the networks being sneaky about the inventory they’re selling, everyone’s in on the joke. People generally don’t know what it is they’re buying. Everyone knows it’s not perfect, and if you expect it to be, you’re a fool. But that’s OK to me because we’re only a few years in, and we’re light years ahead of where online was a few years in. Sure, we still have big problems and issues, but now it’s on the brands and the agencies, but also on the vendor side to make sure we eliminate the friction.
When will mobile start seeing serious investment from brands?
We’re probably two to three years out from seeing mobile as a serious line item where every single campaign is millions of dollars. But when you consider where it was two years ago, it was virtually nothing. That is a phenomenal growth rate: $50,000 today was $0 two years ago. As much as I like to bash on the agencies, a lot of it is down to the vendor side. We all need to work on scalable products with really good metrics. We have to be able to put real numbers behind what we’re doing to prove this stuff works. Right now it’s too easy for buyers to have a preference for online.
What’s the biggest threat to the growth of mobile.
My biggest concern is that the economy worsens again. I’m not worried about marketing budgets; I’m worried about VC money. The last recession actually helped mobile because marketers were looking more carefully for things that deliver ROI, and mobile is more measurable than many other media. I’m more concerned about the ability for companies in this space to get access to money to expand and invest in technologies and products. At this point, it’s essential these companies continue to innovate and grow.