Digital World Could Be Marketers' Dream

In 2008, mobility and social networking will be powerfully intertwined growth catalysts.

Not long ago, participating in media content and marketing meant thumbing through a newspaper, complete with black ink smudges, or basking in the static flow of boob tube's video and audio messages. Today's digital interactive platforms demand that we share, socialize, chat and buy on the go.

A staggering number of consumers already have bought into the change. Nielsen Media recently reported that 35% of tweens (ages 8 to 12) own a mobile phone, and one-fifth use it regularly to text message. And it's not just the youngest consumers. More than half of all U.S. social networkers rely on their mobile devices--most often cell phones--for emails, text messaging, trading videos, and browsing the Internet, according to Ipsos Insight.

What media executives still woefully underestimate is the potency of meshing the social technologies of Facebook and MySpace (and a bevy of social networking sites with names like Radar and Twitter) with the mobile computing capabilities younger consumers know.



Google gets it. CitiGroup analyst Mark Mahaney explains it is the driving force behind Google's spectrum bid for scoping out a wireless network of its own and blasting open the closed tendency of providers like Verizon. He estimates that Google will take half of the $2.3 billion in mobile-search revenues generated by 2010, which is conservative, according to some experts. Google Wednesday launched a unified iPhone application of its services.

A recent Forrester report identified the five primary types of mobile social technology: social networking, media sharing, microblogs, social mapping and tagging. These are the viral marketplaces where Generation Y socially hangs out, culturally shares, and executes their business. Despite the widespread buzz about mobile social-networking platforms, they remain the domain of younger generations, where they spend more time than they do on computers or televisions.

Three-quarters of consumers ages 8 to 18 are sending and receiving text messages, 41% are sending and receiving picture messages and 40% are downloading ringtones. They are five times more likely than their non-data and non-mobile social computing peers to publish a blog and upload photos to a public Web site, and 11 times more likely to add tags to Web pages. While mobile social computing is not limited to mobile social networking sites or to cell phones--that is, where this vibrant activity is taking place--and where content and service providers and advertisers need to become more comfortable.

The high level of prevailing "stickiness" is a marketers' dream, but it also could become new media's Achilles' heel. Misuse or abuse of the highly personalized information that often is "privately" shared could backfire, as has been suggested by the recent missteps made by Facebook's Beacon advertising program.

We still do not know the potentially adverse outcome of users feeling betrayed or violated when the Web services mine the data for marketing gold. To avoid disaster, companies need to understand their own value proposition (right down to the specific data, content and time of day), design for the particular users, tie it back to the Web and to existing networks, and develop a more intimate mobile network that can be configured, customized and controlled by cell phone users.

For instance, Forrester recommends a retailer such as American Eagle Outfitters, which can join a preexisting network catering to the targeted teenage girls. Opportunities for niche-building are endless. Retailers and providers of content and services who understand and respect the power of niche consumers can do very well, as witnessed with As a result, new forms of e-economics, e-marketing, even e-manufacturing take hold and deliver only as much virtual wealth and merchants of new media are smart enough to muster.

That tipping point is at hand regarding behavioral targeting, articularly as it relates and is enriched by mobile social networking. But serving up individual marketing in pitches to users based on their browsing or purchasing behavior already is a tricky business. Lehman Brothers analyst Anthony DiClemente says offering the right ad to the right person at the right time is "one of the true promises of Internet advertising....and a capability that most other forms of advertising cannot easily replicate."

Where better to catch young consumers than on their cell phones, where they already have mastered the art of simultaneously trading information, talking and transacting?

The ultimate payoff is not in milking the targeted connection, but properly pricing it or valuing it with the increasingly popular model of CPA, cost-per-action. eMarketer estimates the behavioral targeting market will grow to nearly $4 billion by 2011 from $350 million in 2006, or 61% average annual growth due to "improved targetability, increased penetration of behavioral across non-premium inventory, and enhanced relevancy," Lehman Brothers' DiClemente said. And it's not just tied to content and data. The global market for plain old vanilla ad-support mobile messaging is expected to swell to $12 billion by 2011 from $1.5 billion in 2006, eMarketer said.

The key will be to tie in marketing to consumer convenience. If a user can find out on a cell phone where the best price is for an appliance, be sent an electronic code for a discount at a favorite restaurant or for parking or a movie, the marketing extension to mobile social networking becomes a potent enabler.

Some of the privacy and consumer protection concerns are most likely to be abated on mobile social networking platforms. Some even flaunt their purchases, preferences and most intimate communications as evidence of their targeted belonging. Like so many things in media, the science of matching niche consumers to targeted ads and services will continue to be a double-edged sword. Practices and parameters will be set by users.

If you believe a new study by Nokia, one-quarter of the entertainment consumers in the next five years will be "circular" or created, edited and share -mostly on mobile phones--among closely aligned consumers rather than by traditional media companies. Such collaborative and creative content, communications and all-around connections can be monetized by companies and individuals who study and respect those new dynamics.

Mastered well enough by Madison Avenue and Hollywood, $1.7 billion in projected domestic behaviorally targeted online ad spending (growing at 65% annually) is but 5% of the total $31.4 billion in U.S. online ad spending. That's a modest beginning of a new, sustainable growth center that has the potential of far exceeding the revenues generated by any of the traditional media categories.

Twitter co-founder Biz Stone may have said it best, as quoted in The Guardian: "Our future holds in store the promise of increased connectivity to a powerful social Internet which truly extends to every little spot on our Planet Earth." And that digital mobile phone in most teenagers' hip pocket is a good place to start.

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