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HopStop CEO: Location-targeted mobile ads 20 times more effective than online

Hertz breaks multichannel LBS campaign across HopS

Hertz ramped up its mobile initiatives via a partnership with HopStop

NEW YORK – HopStop’s top executive said that location-targeted mobile ads are 20 times more effective than online ads during a panel discussion at Borrell Associates Inc.’s Local Online Advertising Conference.

The panel was moderated by Mickey Alam Khan, editor in chief of Mobile Marketer, New York. It focused on best-practice tips and trends related to local mobile advertising.

“We’re seeing click-through rates on the mobile Web and on our apps that exceed our online ads by 20 times,” said Joe Meyer, president/CEO of HopStop, New York. “Mobile ads can engage user when they are out and about, when they are relevant.

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“We have a lot of food and beverage ads like McDonald’s and Starbucks, and if they deploy the right mobile ad at the right time, it is actionable,” he said. “Whoever advertises on that app or mobile site has great share of voice, and if the ad is location-aware, it is going to do well.

“The way we attack local is we go after national and regional advertisers with a local presence.”

Joy Liuzzo

Joy Liuzzo is senior director at InsightExpress

Typically, brands advertising on HopStop’s mobile properties issue a call-to-action for a specific store that is nearby.

Since HopStop is a navigation service, it directs consumers to a specific location, not just McDonald’s, but the McDonald’s at 33rd St. and Park Ave., for example.

Often HopStop advertisers distribute a coupon offer or discount of some sort to drive foot traffic. For redemption, consumers either show the coupon on their phone or enter a UPC code.

HopStop lets advertisers hyper-target

Where are you?

Many also run mobile ads that lead to a download page for the advertiser’s application.

“The majority of advertisers want to market to the platform itself—they don’t care if they get there through the mobile Web or an app,” Mr. Meyer said. “If they want to target iPhone users, we offer them both in-app inventory and target iPhone users accessing the mobile site on their handset.

“What we do for local and regional advertisers at HopStop, we can draw a one, two or three block radius around a store, and we will ping consumers with an ad when they enter it, because it is georelevant and we are location-aware,” he said. “We’re seeing geo and behavioral targeting starting to converge—we know where have you been in the past, so we know what you’re likely to engage with, and we know you are in a specific geographical radius.

“That is very powerful—for local advertising, you can’t just send a broad-based message, you have to get them in store, and location-targeting is very important.”

Mobile insight
A third of mobile owners have a smartphone, including 48 percent of consumers ages 25-34, according to research firm Insight Express.

However, there are some pleasantly confused consumers: 25 percent of smartphone owners call their phone a “regular phone.”

These consumers do not act like the typical smartphone user, but they do not act like the typical feature phone user either.

“Smartphones are the new phone—the experience of the device is much richer, and they are going to be using it more,” said Joy Liuzzo, Washington-based senior director at InsightExpress. “We are not dealing with a homogenous group of smartphone users anymore.”

Users cannot live by apps alone, per Ms. Liuzzo.

Consumers engage in social networking, search/portal, photo/video, news/sports/weather, commerce and mobile content via both the mobile Web and applications.

“The truth, folks, is that you need to do both, because consumers go back and forth between the mobile Web and apps,” Ms. Liuzzo said.

Mobile does not necessarily mean mobile, as many use mobile phones at home.

When asked “Where have you used your mobile phone?” 82 percent of respondents to an InsightExpress survey said in a store, 55 percent said in a doctor’s office or hospital, 36 percent said at a sporting event, 17 percent said during a movie at the theater, 14 percent said while flying on a plane and 7 percent during church service.

There is also the “I want this please” phenomenon: 17 percent of mobile users have shown a clerk in a store a picture of a product on their mobile phone. It is more common among males than females.

Shopping on mobile is multichannel—56 percent of smartphone owners have visited a retail store Web site on their phone

When asked “Would you rather visit a Web site on your mobile phone or download an application to shop/browse a retailer?” 48 percent of smartphone owners said a mobile Web site, 38 percent said mobile application and 13 percent said neither.

“You have to have both because certain consumer segments will prefer one or the other,” Ms. Liuzzo said. “Mobile comes in handy for pre-shopping, creating store shopping lists, getting alerts about sales and looking for gift suggestions or ideas.

“While in the store, mobile helps consumers connect and get the best deal,” she said.

Shoppers can use their mobile devices to take pictures of products in the store, get someone’s opinion by sending a photo, find a product at another store, look for a better price on a product, find reviews of a product when they are in a store and use their mobile phone to scan a bar code in a store.

Since the introduction of the iPhone, mobile norms for campaign effectives across various metrics have consistently outperformed corresponding online norms, per InsightExpress.

Brand metric deltas where mobile outperforms online include unaided awareness, aided awareness, ad awareness, message association, brand favorability and purchase intent.

“We’ve been measuring campaigns in the mobile space for three and a half years—is mobile working? The bottom line is yes,” Ms. Liuzzo said. “Compared to the online space, mobile is between three and four times as effective as online.

“There is often less rich advertising and smaller space, so initially people were saying mobile’s not going to work, you’re full of hooey, but mobile is consistently working, and the novelty is not wearing off,” she said. “High mobile ad awareness has a lot to do with rich-media ad units and social media integration.

“Two words, relevancy and respect, and that is what it comes down to—keep those two buzz words top of mind.”

Final Take
Clark Gilbert, president/CEO of Deseret Media

 
Related content: Advertising, HopStop, Joe Meyer, LBS, location targeting, mobile ads, Borrell Associates Inc., Local Online Advertising Conference, mobile marketing, mobile

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Comments on "HopStop CEO: Location-targeted mobile ads 20 times more effective than online"

  1. ami martin says:

    March 4, 2011 at 1:17pm

    This was a great write up. I found the data on smartphone user device awareness especially interesting. The agency I work for, White Horse, is conducting reseach on why people aren't biting on location-based services. Join us for the first look at the research findings and lively conversation about how marketers can adapt their mobile strategies accordingly: http://tinyurl.com/4r832bt
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