Commentary

Mobile Marketing Emerges With Couponing

According to the Executive Summary of the recent Mobile Marketing report from Borrell Associates, mobile media has emerged as the next big wave in advertising, mainly threatening the Web, but also peeling significant expenditures away from direct mail and yellow pages.

Mobile marketing is set to reach dominant penetration levels faster than any medium before it, thanks to an existing installed base of cell phones (80% of the population) rapidly being exchanged for smart phones (currently about 31% of the population and growing). By contrast, when the Internet was born as a commercial medium in the mid-1990s, only 8% of households had a modem-enabled computer.

After radio, the first electronic new medium, aired the first commercial in 1922, it took 30 years, then 28, then 15 for the next new medium to arrive, from TV advertising in the early 1950s to cable advertising in the late 1970s to the Internet in the mid-1990s.

The study sees fundamentals in place for mobile that will boost its trajectory over the next five years beyond what broadcast TV reached in the 1950s and the Internet reached in the late 1990s.

advertisement

advertisement

For these reasons, Borrell is developing a series of reports focused on mobile marketing advertising. The first sets the stage by quantifying the context within which mobile marketing will unfold, and tackles mobile couponing. a major key to the emergence of mobile marketing, according to the report.

Mobile Coupon Spending Local vs Total 2006-2014 (Million $ rounded)

Year

Total Spending

Local Spending

2006

$3.3mm

0

2007

7.2

0.1

2008

7.15

0.6

2009

86.4

3.3

2010

373.7

11.6

2011

1055.3

52.9

2012

22424

205.8

2013

4101.6

520.7

2014

6598.5

1090.0

Source: Borrell Associates, April 2010

Text-based coupons are the fastest-growing and most obvious mobile marketing application, and the easiest to implement, says the report. Redemption rates for mobile coupons are 10x that of mail or newspaper distributed coupons. The report summarizes the future by noting that a restaurant in Texas pays $37 to send out 500 text messages for a "buy-one/get-one-free burger" offer and gets 60 people to walk in the door, for incremental revenue of $1,000 per day.

Last year online marketing captured $44 billion in spending while mobile marketing reached $2.7 billion. The report expects total online marketing to grow at about 13% compounded annually, to $80 billion by 2014. Mobile will grow at 84% per year and hit $57 billion by 2014.

In addition the report expects foresee "local" online advertising growing at an unusually brisk pace, doubling every year for the next three. Local mobile advertising totaled $285 million in 2009; the report forecasts it to double this year to $586 million, then spike upward to $11.3 billion by 2014. 

$13.3 Billion Local Online Ad Spending Shares in 2009

Medium

Share of Total Spend, 2009

Pureplay

51%

Newspapers

23

Directories

11

Broadcast TV

10

Radio

2

Magazines

2

Other print

1

Source: Borrell Associates, April 2010

For additional information from Borrell Associates, please visit here.

 

 

 

2 comments about "Mobile Marketing Emerges With Couponing".
Check to receive email when comments are posted.
  1. Jennifer Balyint from UD On Campus, April 22, 2010 at 9:30 a.m.

    Glad to see the positive trends! University Directories has a sales force of 750 college interns who will be presenting print and mobile marketing options to nearly 50,000 local business owners nationwide this summer. We're offering a mobile coupon offer this year, and this post is encouraging.

    We've also found that our grassroots division, UD On Campus, is implementing mobile marketing in many on-campus campaigns. Domino's Pizza, for example, offers discounts to college students at South Dakota State once they text in.

    Allowing consumers to opt-in to brands that interest them is a great fit - permission marketing at its best!

    Jennifer
    www.udoncampus.com

  2. Paula Lynn from Who Else Unlimited, April 22, 2010 at 9:36 a.m.

    Can you imagine if all phones had the screen size of any ereader and then all women over 40 (major purse strings directly or indirectly) would be able to see it? ;)

Next story loading loading..