One of the features that ought to be a no-brainer for advertisers is to include an sms short code on all their advertisements. This means that people can see the ad and instantly fire off an sms with their ever-present mobile and get a response just as instantly. Examples might be to claim a coupon, find the nearest stockist, arrange a test-drive for a car and any number of other groovy marketing enhancements.
But at least 6 years after sms became mainstream, this feature is still far from common and what should surely be as automatic as putting a web address on an ad, still gets omitted.
One reason could be cost. While most people would think nothing of firing off an sms to get more info, the advertiser normally faces some cost from the service provider, along with a set up fee. And when the set up fee is amortised over the total response, the cost per response can be pretty hefty.
So it’s interesting that mobi.li have launched a totally free service for advertisers in the UK - the user pays the normal cost of the sms. So that means no set up or ongoing charges and really, removes any commercial rationale for not embracing sms interactivity. Their business model , if you’re curious, is to sign up customers and sell them other services in due course. A pretty common plan these days.
However, I suspect that one reason why agencies especially are reluctant to go down this route is that it introduces a frightening level of accountability. Currently, assessing advertising effectiveness is pretty woolly in most cases, involving measures like the number of people who could see an ad. If you start to prove how few people actually notice an advertisement and then engage with it via an interaction, it might begin to call into question the whole point of running a campaign in the first place.
Having personally experienced a meeting (a long time ago now) with a marketing director of a major brand where we both knew that his campaign had very few redemptions, there’s just no way of getting round the facts. Sure, you can fall back on mumbling about coverage, opportunities to see and other marketing-speak, but if no one felt inclined to respond to the offer and that’s 100% measurable, how can you persuade the guy to carry on using the channel?
However, in these days of increasing media accountability, with budgets migrating online and now to mobile, where payment by results is increasingly the norm, old media needs to fight back. If your poster, TV commercial or print ad isn’t engaging the consumer and isn’t generating a response, maybe it’s better to know that and identify what’s wrong with it, rather than pretending everything in the garden is rosy.
Pay per click (via a mobile) and pay per call is coming to old media as inevitably as England losing on penalties in Euro 2008. And that’s going to be another head-butt in the chest of an ad industry already dizzy with the pace of change and largely unable to understand that the world has drastically changed on them.
[tags] advertising, pay per click, pay per call, sms, interactivity, mob.li [/tags]
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Hi Russell, I just wanted to let you know that MoreAdInfo (http://www.moreadinfo.co.za) launched a similar service in South Africa last year and a number of estate agents in particular have been using the system quite successfully. So an advert for a property in the paper includes a code that the user sends to an SMS shortcode and they receive an email with details of that specific property. Obviously the idea could work for any kind of information rich product. (Disclaimer: My brother was a devloper on the MoreAdInfo system.)
Hello Russell,
Here are the main SMS marketing problems in a nutshell for agencies, brands and others
1. Cost.
- shortcode cost ($500-$1000/month)
- messaging costs (~10 cents per message)
- mobile marketing application licensing cost ($2,500 and up per month)
- creative services cost (how deep are your pockets!)
2. Time.
- 2 months to provision shortcode with carrriers (while you pay CSCA/Neustar
$500-$1000 per month for 2 months for an inactive short code-model needs
fixing)
- Select aggregator and get account sign-up OR
- Select Mobile Marketing partner with aggregation component
- Design creative services and mobile marketing campaign
3. Difficulty
- The process can be confusing for many brands, media and other marketers
and this requires education by the mobile marketing companies. This also
leads to longer sales cycles and increases cost of revenue. (See Costs)
- Some systems are not as flexible, rapid or difficult to change at different phases
of the campaign
4. Campaign Types
- Short-term or fixed term. Most campaigns are event-driven and shorter term.
- Set-up time can exceed campaign duration (See Time)
5. Lack of Creativity
- Many do the same type of campaigns. Voting, polling, quiz, trivia, etc.
- There are so many new and clever ways beyond this to allow marketers
and advertisers to gain traction.
- New mobile social applications are an example of creative ‘maven’ type
campaigns
6. Revenue Share
- Premium SMS. Carriers take nearly 50% of PSMS revenue.
- Mobile Marketing companies also take a slice (~25%)
- ~25% left over for the content companies who look to mobile channel
as new revenue stream
- Most advertisers see this as a marketing expense so rev share is lesser concern
Summary:
Only large brands and bigger companies can afford to run these SMS campaigns as the barriers are time, money, and ease of set-up and design. These barriers would have to be reduced in order to gain wider adoption. CSCA/Neustar need to fix their model (e.g. a client would have to pay for 3 months shortcode even if campaign length is 1 month).
Cheers,
Reno
Having done this, the process is measurable… But it is just too expensive. Thousands of dollars for the shortcode and per message… But I agree is a great method to reach (and get reached).
ceo
A fantastic point Russell and what great comments. You all hit the nail on the head. First, just to back Russell up, I actually get frustrated, even mad at times when I see or hear an ad for something I’m interested in and I can’t text it to “bookmark” it for later follow-up. I know I’m going to forget but I usually don’t want to call a phone number while I’m busy doing something else and I usually am not a computer to go to a domain name when viewing/hearing such ads. I really love billboards along highways with no contact info other than a web site…now when exactly am I to visit that site? Right now while I’m in the car? No, so now the advertiser/agency is counting on me to remember it…like that’s going to happen.
Fortunately, companies such as OTAir (I will selfishly withhold the names of the others, though you can easily find them) are launching now that the U.S. market is finally ripe to solve the numerous problems that Reno details. We’ve been through the startup costs, the carrier approvals, the long wait and the system development and now we at OTAir can “divy up” our short code across many advertisers using keywords. This means we can have a mobile campaign up and running within one business day and at a very low cost vs. the advertiser going it on their own. Not to mention, advertisers get the advantages of our constant and rapid new functionality development without having to pay for that giving them a flexible, but solid environment from which to run their campaign. So, now companies big and small have no excuse to pursue what Russell says they should be doing - for examples of what some are doing with keywords, visit http://www.otair.com/index.cfm?action=shortCodes.
Jim,
Are you guys doing mobile bookmarking aka QTags?
Reno
Reno -
Yes we are. As a matter of fact, we have our own trademarked term for it…TXTmark. Advertisers can very easily, inexpensively and quickly enhance and extend ALL of their marketing messages using a text call to action that empowers individuals to actively engage those products, companies, services, events and people that interest them by TXTmarking the ad. There’s much we can do and are continually rolling out, but I don’t want to use this post as a self-promo so please visit our site at http://www.OTAir.com if you would like to know more.
Thx - Jim
We tried to launch this type of service in the UK about 3 years ago. We offered:
* Free keyword set up.
* No monthly or ongoing costs.
* 3 day setup on new keywords and supporting campaigns.
* Automated response to first address line postcode with email of address details to advertiser’s marketing department (if they wanted this type of campaign).
* Automated ‘nearest store is’ response if required.
* Automated ‘item reserved’ response if required (for product launches)
* Automated email response if required.
* Option of 10p or 25p to customer (so no charge to the advertiser to send messages and a little revenue back) or higher-value pSMS keywords/shortcodes.
* Permanent support for the keyword so old ads would still be responded to (Our current record for an ongoing campaign is still providing support and service (and revenue for the promoter) 2 years after the promotion ended)
* Option for free-to-customer SMS sending.
* Worked seamlessly across all carriers (including 3 and Virgin)
* Full online, real-time reporting of campaign response.
* All customers remained the advertisers customers, we did not try and use or sell the collected details for our own purposes.
We had absolutely no response from anyone, and those advertising agencies we spoke to were not interested in the slightest. *No-one* wanted it.
We can still provide everything as above, but we don’t market it or promote the service anywhere anymore - it became a waste of our time and money trying to get people interested in something we saw as so blindingly obvious.
Although I guess now that more advertisers are starting to take notice of this sort of thing, we should start promoting our service a little more…
Tom Gordon and others,
In the US market, “Option of 10p or 25p to customer” won’t fly. With Google and everyone else offering standard rate, I don’t see a premium mobile advertising service succeeding at all. Premium content (ringtones, wallpapers, etc.), ok, but not customer paid advertising.
Of course, putting the cost on the advertiser makes it a hard sell when it’s not widely proven to provide an ROI.
But winds are definitely changing in the US.
Tom…I’m shocked that your offering didn’t take in the UK with all the texting that occurs there. It sounds great based on your desc.
Jonathan…you are absolutely right on many counts. Customer paid advertising will not fly. Premium content is viable, but not our focus and not applicable to all advertisers. Fortunately, the winds are changing rapidly…finally…in the US. Advertisers are willing to spend for OTAir type services. Though it is inexpensive, we find ways to reduce the cost burden for advertisers with message sponsorships or supplementing revenue by offering related services to the mobile user via text when requesting info on an item. For instance, texting a book ISBN to get price info and then buying that book through an online link with a referral kickback coming to us.
Advertising in the U.S. is increasingly in a state of turmoil…not advertiser and ad agency will admit that, but content snacking, time-shifting and place-shifting of content, fragmentation of media, the TiVo effect and more are having an impact that marketers are trying to figure out how deal with. While mobile, and specifically text, is not THE answer…it is a great solution and our list of partners and clients realizing that and hopping on board is rapidly growing as a result. If it’s going to fly anywhere, it’s gotta be the advertising capital of the world.
Russell,
Your posting took the words right out of my mouth. For a long time I have been wondering why I don’t see short codes on print ads in magazines and Newspapers. I think the first reason is getting the advertiser to understand the technology. Only the big companies use agencies for their ads, the bulk of the market is the small business putting an ad in their local newspaper.
The other issue is the cost, as Reno has pointed out. This is exactly the reason we are launching Mobivity. Any business should be able to do a short term mobile campaign without laying out thousands of dollars and waiting 6 weeks.
They should be able to grab a keyword, put it on an ad and be up and running instantly.
Tom,
A month ago we were tearing our hair out trying to find exactly this service.
We’re still intersted, please drop us a line.