LiveRamp Events

Fixing the Mobile Advertising Spend Mismatch

February 23, 2017  |   LiveRamp

[Editor’s note: Laura Beaudin is a San Francisco-based partner at Bain & Company, where she leads the firm’s global marketing. She is also speaking at RampUp 2017. We invited her to share her thoughts on data and marketing trends. To learn more about RampUp, check out the agenda.]

People are increasingly attached to their phones. A Bain & Company survey found that people interact with their devices an average of 200 times per day – for communication, information, entertainment, and socializing. They’re also consulting their phones whenever they’re in the market to make a purchase.

Yet, while people consume 25% of their media on their phones, companies overall spend just 13% of their marketing budgets on mobile advertising, and much of that advertising isn’t suited to the medium—it’s often repurposed from ads produced for television, meaning it’s too long and too slow for mobile users’ short attention spans.

Why the disconnect?

The survey results offer two key explanations:

1. Companies often view mobile advertising through the prism of digital media, applying the same expectations, practices, and measurements they use in other forms of online advertising, but mobile is its own medium with entirely different rules of engagement.

2. Some companies are misled by their own metrics, and those they use to calculate mobile’s effectiveness are often incomplete. While 94% of smartphone owners use their devices to search for a store, that activity is captured by conventional metrics only when a consumer actually uses his or her phone to buy something.

No metric, however precise, can quite capture the qualitative aspect of mobile advertising, what marketers refer to as the “magic” of the medium. Brands can create an intimate connection with mobile in ways that aren’t possible even with other digital media, and they can reach consumers at the precise instant when they are ready to shop – and buy.  

Marketers like to call this narrow window a micro-moment.

In an effort to capture more of these occasions, companies are conducting focused, scalable experiments in mobile marketing – with strong results.

Red Lobster targeted  customers with mobile advertising when those consumers were near one of its restaurants during prime dinner hours. This helped the chain reach potential guests at those micro-moments when they were most likely to stop in for a meal. In test markets, mobile users who saw Red Lobster’s ad on their devices were 31% more likely than those who didn’t see an ad to visit a restaurant that day.

Angie’s Boomchickapop popcorn developed a mobile-first strategy to reach its target shoppers – young, active females – during the micro-moments when they were mostly likely to want to munch. In six cities, Boomchickapop connected with consumers on their phones during the prime time for popcorn consumption (weekends) when they were near a retail location. The company recorded a 23.4% lift in sales in the test markets and calculated a return-on-investment of $1.30 for every $1.00 spent on the digital campaigns.

Companies that are willing to look beyond their own conventional metrics, develop and test mobile-first campaigns, and embrace the magic of the medium have an opportunity to leap ahead of their competitors.  

Message to marketers: Now is the time to take the next step on your mobile advertising journey. Your customers are already there – and they’re waiting for you to make the most of your mobile moment.

Secure your spot today to hear Laura Beaudin speak about how the marketing and media industries will evolve as emerging technologies and continue to drive every aspect of brand marketing and the marketing stack. For more about her and the rest of the RampUp 2017 speakers, see our speakers page here.