eMarketer reports on a survey by Harris Interactive that suggests that users don’t want mobile advertising, unless they’re paid (or otherwise incentivised) to receive it. In fact, the majority (90%) were “not at all interested” in the idea with just over 1/3 being agreeable to being paid in some way to get them.
Let’s leave aside the fact that the survey omitted mobile web based advertising in its options to deliver ads, which may have significantly skewed the results. I mean, if the user’s perception is that they were going to get interrupted with SMS alerts, I can understand some of the negativity. This type of advertising is very interruptive, after all.
It’s odd to leave out the format that seems to be growing faster than any other though.
However, I don’t believe that this is the right way of looking at advertising and indeed, as consumers, most of us don’t. The choice generally isn’t one between “no advertising” or “some advertising” as this survey suggests. But between “no advertising” and “free or subsidised content or services”. In other words, if you asked viewers of a commercial radio station if they’d prefer no advertising or paying a subscription to listen, the vast majority (not all) would opt for the advertising.
AdMob (my day job) has just served 1.5 billion ads (yay) and in fact, we’ve only ever had one complaint, which is too small to even be measurable in percentage terms. The lady wanted to know why advertisements were suddenly appearing on “her” mobile website. We explained that the ads were being served by our publishing partner so that they could continue to provide the service she enjoyed for free. She suddenly turned very supportive 
A further theory I’ve developed is that users are using mobile web ads to help discover and navigate to new content. This could be why the click through rates tend to be so high right now.
But I’ll finish with eMarketer’s conclusions about directly paying people to receive ads. Many have tried this model and all (that I can think of) have failed. If you’re tempted by this business model, you have been warned.
But mobile advertising can be used successfully to subsidise content, services and applications and I’d predict that this is going to be the next big phase in mobile. Note though that ad-subsidised is very different from ad-funded, because when you crunch the numbers, models entirely funded by advertising just don’t add up very often.
Right put Russell. The question on some surveys are very tricky.
Some years ago when working for a cosmetic firm we did an online survey asking Internet users if they would go from a site promotion-to-store to get a product sample and most of them answered no. They answered that they would prefer to receive it at home. Me too
Reality showed that women, and many men now, liked to try new product launches and would definetely go to a department store to get a free sample after having registered on our website.
Same trend in Spain: Coca-Cola is subsidizing the spanish football league “virtual” goals to mobile phones through movistar emocion free.
So, you support spam? Just kidding. But you’re right — it’s a dodgy question. Level of interest among US mobile phone users in receiving advertisments via mobile phone — 90% not at all interested.
Level of interest among US citizens in receiving advertisments via any medium whatsoever — 90% not at all interested.
The only exception I can think of is certain womens magazines where the ads for clothes and make-up are the real reason a lot of women by the publications.
The problem with mobile advertising is that Consumers can end up paying for it. If a mobile website has banner adds, pop-ups, nice jazzy pictures of the sponsors product then I have to pay for that extra data over my mobile connection. Combined with the extra time that it takes people to download the extra information it’s not surprising that people don’t like the idea of mobile advertising.
If I’m paid to receive the adds it would at least off set the extra costs that I’m paying to subsidise your business model.
Hi Russell and readers of MobHappy
Very good posting as per usual, Russell. And very good points in your blog about the concepts. I also liked the observation by James here, that if you asked Americans if they wanted ads in any media, 90% would say no…
I’d like to bring in some perspective. America is the industrialized world’s laggard mobile market with USA (second last) and Canada (dead last) among all indstrialized countries in cellphone usage. Identical trends in EVERYTHING from users abandoning landlines with a clear preference to cellphones, to starting to use SMS text messaging. To show Americans how far it can go, USA cellphone penetration rate per capita is about 75%. The European average is 105% and the world’s leading countries - Taiwan, Hong Kong, Italy and Israel - are at 130% and still growing. As per capita means penetration across the whole population, and while children do have phones (KDDI just released a new cameraphone model aimed at the under 9 year olds), certainly the toddlers don’t. So over 100% penetration rates mean people own multiple subscrptions and phones - one in five Europeans has two phones, in fact young adults now think its a sign of being cool and/or important if you have two phones.
Same with SMS text messaging. Americans have reached 42% SMS usage according to the CTIA. That is like European averages about five years ago. When calculated across the whole cellphone subscriber base, Americans send 0.5 text messages per day. The European average is about 1.5 text messages per day. But the leading countries like Philippines, Singapore and Korea see SMS use at the levels of between 10-15 SMS per subscriber per day. And before you say “but its poor teenagers” - think again, British business executives say SMS is their most important communications tool, totally indispensible to daily work. And British youth? One in ten British teens averages 100 SMS per day, talk about aching thumbs.
Now, American cellphone usage trails the industrialized world average, but shows IDENTICAL patterns. Expect Americans to become as addicted to cellphones as the Europeans and Asians.
So the survey of only an American user base, is also skewed very strongly against the norm of the industrialized world. If we ran the same survey in Japan - the world’s most advanced mobile advertising market - where 54% of Japanese cellphone users ALREADY consume ads, and 44% of Japanese consumers ALREADY actively click on advertising links on their cellphones - you would find a radically different result. Now with companies like Admob (Thanks Russell for sharing your numbers with us from time to time, they are such a wonderful source of validation here in Europe) we can see that this concept is totally valid beyond “just Japan”…
Thanks
Tomi Ahonen
4-time bestselling author on mobile and media
lecturing at Oxford University on mobile and media convergence
blog http://www.communities-dominate.blogs.com
Some interesting discussion on this topic here: http://www.linkedin.com/answers/technology/wireless/TCH_WIR/49120-1145339