Mobile will take 50% of budget in 2017, but held back by skills gap: study

Marketers will spend 50% of their budgets on mobile by 2017, but for the moment are hampered by their lack of understanding of the medium and difficulties in quantifying return on investment, according to Experian Marketing Services.

Only 4% of the 320 marketers involved in Experian’s mobile marketing study are regularly implementing mobile marketing activities, despite a widespread belief it will be one of the most important ways to communicate with customers in the future.

Head of research and consulting at Experian, Dave Audley, puts the slow uptake of mobile down to three key reasons: a skills gap in the industry, difficulty in demonstrating ROI and the tug of war for budgets between traditional and new channels.

“There’s some confusion and difficulty when it comes to budget allocation,” Audley says. “Marketers are finding its quite difficult to quantify return on investment by channel. Organisations are reluctant or not committing to investing in the [mobile] channel just yet until they fell confident that they can measure the return that they get.”

Mobile has also added another layer of the complexity to the tug of war for budget between traditional channels and new, Audley adds. “Rather than out with the old in and with the new, organisations are looking at retaining old channels; traditional offline channels are also becoming increasingly important.

“Finding the priority to put the focus that’s needed into making a successful mobile strategy come to life is quite a challenge.”

As a result, almost six in 10 are yet to test the waters with mobile, while 41% have created a strategy but haven’t started implementing it.

When asked to rate the importance of marketing channels, 53% of marketers said face-to-face communication was one of the top three most important channels. Email was rated by 50% of marketers as a top-three channel, and social media mentioned by 42% of marketers as a top three channel.

Early adopters of mobile report good results, the study found. The vast majority of respondents believed the various mobile techniques asked in the study to be effective, with mobile-optimised websites, m-commerce and MMS emerging as the most likely to be perceived as ‘highly effective’.

Email ranked down the list slightly, while custom apps were the most likely to be perceived as ineffective.

Search, display and video pre-roll were not asked as part of the study.

Perceived effectiveness of mobile techniques among marketers

experian

“In the next five years Experian predicts more than 50% of marketing budgets will be associated with mobile, particularly as traditional, above the line channels, such as TV and billboards become more interactive and entwined with mobile,” Audley predicts.

“Clever companies will integrate mobile with existing channels, without compromising other activity. Because mobile is cost effective, easy to implement and is nimble, it creates a dynamic platform where brands can create a two-way dialogue.”

 

Custom apps: truth in data

 I’ve been blogging about online distribution channels and the reverse value chain, and how important they are as a marketing tool. Custom applications are just another extension of that idea of using custom-made tools to improve your marketing – online and off. But, I think they are a seriously underutilised resource for any marketer today. They can provide priceless data on your clients, which can hugely influence the effectiveness of your online marketing communications.

Developers like us specialise in creating custom applications for our clients, where we can tailor the application for a specific client objective. But if you want to go down this road successfully and unlock the value of the information you can collect on your customers by using a custom app, you must have real passion and dedication to consumerism and social networking. 

Getting back to the idea of the reverse value chain, a marketer should be guiding the customer to the product, not the other way around. And this sort of information you can get by understanding the types of technologies your customers are using on a regular basis.

Of course, it all sounds simple enough, but unless you spend all day, every day researching all of the available applications in the market today, then it’s fair to say you’d probably be fairly lost in what is right for your objective (and you’ve probably got other things to worry about like getting ROI on your marketing communications).

It’s because of this abundance of information in the market that it’s fundamental that a marketer engages with a digital expert who actually understands the space and what is available as part of the distribution mix. The most important question you need to answer in the digital space is: where does the customer live online? What types of technologies do they like to use to communicate? And your digital partner should be able to guide you in the right direction to answer that question and look at how these technologies may change over time.

Once you’re guided in the right direction it’s almost like having a free customer service department online. You’re able to receive free data through different social technologies. It could be critical or empowering but whatever the case, it’s real, truthful data that hasn’t been manipulated by some mechanical process, and that’s almost priceless.

Imagine what you would spend on focus groups – which have their place – where people tend to mediate their responses and where their responses are again translated to you. Custom apps give you real time, unmediated information that is essentially free.

Naturally the end result of using a custom application is how to get your customer to touch your product by stepping into their environment online, it should never be product to customer.