Mobile advertising supply continues to exceed demand: Digiday Mobile panelists
September 22, 2011
NEW YORK – Much of the discussion at Digiday Mobile focused on problems that publishers face in the mobile space such as choosing a model for the pros and cons of paid and ad-supported mobile content-monetization models impose on publishers.
An executive from The Boston Globe went as far to say that monetizing the company’s mobile efforts is one of its biggest problems.
“We’ve struggled to monetize content,” said Jeff Moriarty, vice president of digital products at The Boston Globe, Boston. “We broke our audience into two groups, and we realized that we were not serving either.”
Mr. Moriarty said that The Boston Globe now has two mobile properties. Boston.com is ad-supported, and Bostonglobe.com is an ad-free environment that users can access for a fee.
“We expect a lot of people to use both,” Mr. Moriarty said.
Brendan Monaghan, vice president of business development at The Slate Group echoed Mr. Moriarty's thoughts on monetization.
"Mobile is still so early in development and at Slate we are still trying to figure out a way to capture readers on mobile," Mr. Monaghan said. "We are not quite there yet with monetization."
At an impasse
Some publishers are seeing as much as 15 percent of their traffic from mobile devices.
However, the advertising environment remains challenged on mobile with supply exceeding demand.
Despite increased adoption in mobile advertising, publisher fill rates are in decline.
Brands are not quite convinced that mobile advertising works.
During the “Buyers Speak Out” panel, representatives from marketing and agency firms said that although mobile is growing, technology is not up to par for brands to make it a significant part of their marketing mix yet.
“One of the main things that hold people back from mobile is the user experience,” said Christopher Miller, executive vice president and group managing director for digital at DraftFCB, New York.
Additionally, the other executives mirrored Mr. Miller’s statements.
“We’re not seeing a reason for money to follow mobile yet,” said Jordan Bitterman, senior vice president at Digitas, Boston.
Brands are willing to test the mobile advertising space, but are not quite ready for 360-degree mobile strategies. Mobile advertising should not be used as a stand-alone marketing vehicle. Instead a mobile ad campaign should complement and strengthen other marketing efforts.
Successful mobile marketing means a 360-degree strategy and so the industry is at an impasse.
Campaigns need to include multiple mobile aspects such as optimized Web sites, banner ads and apps in conjunction with each other.
“Mobile is the glue that connects marketing experiences together, but as brands and agencies, we have to think about if we are ready to accept mobile,” said San Francisco-based JiYoung Kim, senior vice president of strategy and new solutions at Ansible.
DraftFCB's Mr. Miller was optimistic and said he expects mobile spending with DraftFCB’s clients to increase ten to 15 percent in the next year.
The executive also expects to see an increase in measurable data that brands can use as solid proof that mobile is effective.
Paid content to the rescue?
Shannon King, vice president and general manager of Real Simple Digital, New York, said that to solve the problem of monetization, publishers should go with the paid model.
“The paid model is the way to go” Ms. King said. “It is real simple.”
Jeff Price, president and publisher at AOL’s Sporting News, New York, also spoke on the panel and sees now as the time to push into mobile.
“More brands are starting to understand the actual ways we use mobile,” Mr. Price said. “Overall, there is going to be a premium opportunity in mobile for the next 12 months.”
According to Michael Schloff, director of product management at PubMatic, the first step with mobile has already been taken.
"The desire is there to reach consumers on mobile, but the technology behind it is maturing," Mr. Schloff said.
"It will be a race to the top as the technology gets better," he said.
Jeff Litvack, general manager of global product development at the Associated Press also spoke on this panel.
AP’s approach to tablet space and mobile overall is very different from competitors. Mr. Litvack said that AP is not a consumer brand.
“We started in mobile for the big opportunities as a whole,” Mr. Litvack said. “AP mobile continues to grow and has 9 million registered users.”
On Monday AP announced Toys R Us as one of several national retail brands that is testing its new program that makes traditional weekly printed circulars available on mobile news sites.
The mobile circulars are enhanced with location-specific offers, the ability to create a shopping list and other functionality. Instead of launching a separate circular app, the AP decided to do an app-within-an-app in order to leverage newspapers’ existing mobile audiences (see story).
ICircular is not just an opportunity for publishers. It is an opportunity for publishers and advertisers to collaborate.
“We see a big opportunity tying together the Web with mobile for a revenue experience,” Mr. Litvack said.
Jeff Moriarty, vice president of digital products at The Boston Globe, Boston
Related content: Advertising, Jeff Moriarty, The Boston Globe, Christopher Miller, DraftFCB, Jordan Bitterman, Digitas, JiYoung Kim, Ansible, Shannon King, Real Simple, Jeff Price, Sporting News, Jeff Litvak, Associated Press, mobile advertising
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