Who Is Driving The Growth Bus?

The predictions of mobile marketing growth often lack a clear rationale from analysts. Even as soothsayers I have seen anticipate 10x spending increases over the next few years, many are grounded in the same vague promises of "shifting ad budgets" that fueled the silly Web ad projections of 1999.

It probably was healthy to hear Digitas Vice President and Media Director Jordan Bitterman say at OMMA East this week that mobile marketing is only at the edges of his radar for now. "It doesn't have the scale," he says. "Our marketers are looking for scale."

Quibble as we will with Bitterman, it is important for people within the hot category of mobile to remember that at the top of the media buying chain there is still a case to be made for this medium and for the predictions of fast growth.

And so it was good to see The Kelsey Group actually back up its argument for 112% CAGR mobile marketing growth through 2012 with cold, hard -- well, theory.

Kelsey analysts are pegging current spend at a measly $33.2 million, which includes ad-supported directory assistance, mobile Web, and applications. They see spending across these categories growing to $1.4 billion by 2012, which is more modest than many estimates I have seen.

Interestingly, they single out mobile search as a key driver, because both Google and Microsoft especially need to position themselves for growth here. For Microsoft, mobile represents an opportunity to get a toehold on handsets that it never really achieved online. For Google, mobile represents a much needed expanded inventory to handle some of the $1 billion to $2 billion in unmet demand for search inventory.

I think Kelsey is especially smart in pointing out that voice search (sponsored directory assistance) is going to be a category to watch. One ad-supported 411 vendor with whom I spoke during Ad Week tells me that 60% to 70% of his company's millions of calls a month are coming from mobile, where people can easily pop it into their phone books for speed dialing.

I would also add another player to mobile search that gets overlooked: AOL.

I asked traffic monitoring site Hitwise to provide me with some numbers on the mobile search site traffic they were seeing across the major brands.

In terms of overall market share of all Web traffic, this is how the majors ranked: 0.0047% 0.00060% 0.00049% 0.00029%

Yahoo clearly has the lead in overall share of mobile search, which I have seen confirmed by others. But Microsoft is not the only brand trying to grab an opportunity on mobile it lost online. The AOL Mobile site on the general Web has long been one of the best hubs for mobile services at a portal. In Hitwise's numbers at least, this strategy pays off with a higher percentage of traffic (not necessarily users) to its mobile search properties than Google.

Beyond search companies moving inventory to mobile, Kelsey believes that consumers, too, are headed for the mobile Web, from 37.9 million today to 91.7 million in 2012.

Among the many takeaways I brought from OMMA East's mobile panels this week were clear indication that the media industry and consumers are now driving mobile content usage, not the carriers. Off-deck content distribution is becoming most attractive to media companies as the networks sluggishly roll out their models and keep pocketing too much of the revenue. NBC Universal's George Kliavkoff said that mobile as a platform is attractive but badly "broken," because the carriers are exacting up to 70% of the revenues. Like Bitterman's comments, some of the most telling and important remarks about mobile this week came from people outside our world.

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