Overcoming many restraints, including untested technologies, mobile marketing in the USA has emerged as a highly successful medium for advertisers. Its enhanced interactivity and speed of response give mobile marketing campaigns an edge over traditional media such as television and radio. New analysis from Frost & Sullivan reveals that revenue in the market totaled US$11.5 million in 2004 and projects to reach US$69.3 million in 2007.
Absences of coordination and mismanaged relationships have been long-standing bottlenecks, intensified by the lack of a central aggregator for mobile operators. The plurality of mobile operators and their individual rules and regulations slow down mobile marketing campaigns.
"Although marketers reserve short codes from the Cellular Telecommunications and Internet Association (CTIA), they still have to contact each mobile operator and short messaging service (SMS) aggregator for connectivity," explains Frost & Sullivan Industry Analyst Vikrant Gandhi.
Marketers also must ensure that each mobile operator participates in the campaign, where each one has a different set of rules and regulations about the suitability of content for subscribers.
In addition, as network speeds increase, there is mounting pressure for better coordination between mobile operators, application developers, and brands. This is essential if the entire value chain is to benefit.
The lack of flexibility among participants in the value chain also stalls decisions on suitable revenue shares in a campaign. Since revenue from mobile marketing campaigns expects to rise with more advertisers utilizing this medium, participants must resolve this issue.
"The mobile operators bill the campaign-related messages successfully delivered, retain a share, and pass the rest to connection aggregators. They, in turn, keep their share and forward the remaining to the next level of the value chain," observes Gandhi. "The revenue flow may actually vary as in some cases, the brand owners pay the mobile operators for banners and interstitials, while in other instances, the mobile operators pay revenue share to the brand owners for text messaging-based campaigns."
As companies outside the telecom and entertainment arena also adopt mobile channels as marketing mediums, there has been an increased flow of revenue. This upswing has led to the establishment of companies that specifically produce mobile marketing campaigns. With a large pool of mobile users, these campaigns have the potential to accelerate user adoption.
Besides mobile operators, specialized companies can assist in disseminating accurate information on interactive mobile marketing, as the popularity of text messaging is providing lucrative opportunities.
These trends toward a "one-stop shop" are likely to boost customer interactivity and maximize brand awareness."
Posted to the site on 26th January 2005
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