• by Michelle Manafy , March 11, 2014

More than half of the world’s population will own a mobile phone by the end of the year. That’s a total of 4.3 billion people. There will be 250.6 million in the U.S. alone -- 91% of adults. More than half of these are smartphones on which people consume a wide range of content. In fact, as many as a third of Internet users rely on the phone as their primary Internet access tool. Clearly, there is an opportunity to influence a vast number of consumers throughout their research and purchase decision cycle via mobile.

And the good news is that mobile ads actually do influence consumer behavior. After seeing a mobile ad, 80% of users report that they have downloaded an app, 67% visited an advertisers’ site, 52% visited a retailer and 37% called an advertiser. The opportunity in mobile advertising is big and getting bigger, fast: A wide range of research finds that mobile ad market revenue is on a steep growth trajectory, reaching $18 billion this year. To make the most of this opportunity, there is a need for continued understanding and innovation in mobile advertising -- from publishers, agencies and marketers -- to optimize consumer experiences and ad effectiveness.

“Mobile is getting a lot less clunky and more sophisticated, which is a good thing for users and the industry,” according to Time Inc.’s Director of Mobile Sales & Strategy, Sol Masch. However he finds that beyond great creative, establishing KPIs that match the way people use mobile is essential for ad success. “On mobile, most clients want engagement. The question is, what does engagement mean? Often, engagement is defined as getting a user to interact, so you have to create rich messaging that drives interaction.”

While he finds that “more and more advertisers are beginning to take advantage of mobile rich media executions that leverage the functionality of the phone GPS, accelerometer, or touchscreen to make ads much more fun and engaging than their desktop counterparts,” About.com CRO Brian Colbert cautions publishers and advertisers to keep in mind that there is a fine line between “engaging” and “intrusive.” Colbert points out that “the use-case for mobile often differs from desktop, and users are less inclined to tolerate ads that disrupt their user experience since they are often on the go and under greater time constraints.”

Given that the name of the game is mobile, it isn’t too surprising that opportunity -- and challenge -- for mobile advertising is reaching the customer “where they are,” according to Joe D. Weir, VP of digital at A.H. Belo. However, Weir emphasizes that this does not simply mean a physical location. He says you also have to keep in mind “where the customer is within the buying cycle… We need to understand how the consumer is using mobile so we can connect them with content that helps them make better decisions.” He has a point, given that smartphones are used for research at the beginning as well as in the “last mile” of a purchase decision and smartphone shoppers convert in stores (as opposed to tablet shoppers, who convert online).

When developing mobile advertising, it is also important to be very sensitive to the issue of time. Masch points out that often people use mobile during “found time,” such as a couple of minutes on the bus or waiting for an appointment. So to maximize ad impact, Masch says, “mobile demands quick hits that are just as powerful as longer times spent on other devices. The trick is in designing those experiences that last less than a minute, or even just a few seconds, to deliver impact and engagement.”

Colbert says it isn’t just a matter of time, but also of optimizing creative for mobile devices. “From an ad-creative standpoint, there is still a tendency for advertisers to cram too much information into too small a space on mobile. The hardest thing for advertisers to accept in mobile advertising is that less is more.” Colbert advises marketers to “be quirky, be relevant, be interesting -- but most importantly, be concise.”

While continued innovation, understanding consumer behaviors and developing accurate KPIs are all building a foundation for mobile advertising success, the complexity of the mobile environment remains one of the greatest challenges. “Devices and operating systems will keep on coming and we need to simplify it for the marketing and advertising community,” says Masch. “The more we can establish standards, the more it will help everyone. Within the structure of standards, we will be able to innovate even more.”