Wednesday, September 22, 2010

Mobile Advertising – What about placement?

In traditional media, advertisement placement is everything – whether time slot in a TV show, where in a magazine/newspaper or the type and circulation/viewership of the media itself. And like no other variable, placement drives pricing. So what about mobile ad placement? Does it even exist?

Most mobile ads today are delivered based on the keywords the ad requests contain. These keywords have some (nearly) static parameters like phone type and IP address (country/region/operator) and variable parameters associated with the application or mobile media where the ad will be shown. Location stands out in a category of itself as it does provide information about exactly where the viewer is when the ad is shown, the place of the placement so to speak. As for placement on the phone screen the main distinction is banner ads versus ads placed within a mobile application or web page. As mobile web pages are smaller versions of web pages the placement is more limited but can be at the top or further down the page and even in follow up ‘click through’ pages. While this leaves plenty of placement options within applications and web pages, the placement opportunities at the highest level of the mobile web user interface, the front page so to speak, is relatively limited.

As long as we have static matrix like user interfaces to our apps and web on the phone, ad placement at the highest level will continue to be limited. But when we move to more open-ended navigational user interfaces, like mJetz, targeted ad placements amongst app and web icons suddenly become possible. These ads can be closely associated with where the ad is placed. If it is next to movie app it will be different than if it is next to shopping or news app and ads can also be placed dynamically next to where they make sense or where they have high visibility. In fact, mJetz is able to combine both static, variable, personal and placement data in its keywords and thus place highly relevant and high value ads throughout the mobile web user experience, both at the top level and within apps and sites. In this world mobile ad placement can provide the user with relevant ads at the right place and the advertiser has access to keywords so that they can create and serve these ads. These ads will become more valuable to bothe the user and the advertiser – a true win-win!

Saturday, September 18, 2010

Mobile Advertising - Nuisance or Value?

In the mobile application business, advertising is discussed as a way to make money for publishers of mobile content and applications. In many ways it is treated the same way as advertising on television, in newspapers or magazines – a nuisance there for the sole purpose of paying for the content and ‘fund’ the business. But is this really the case?

It is clear that much of today’s mobile ads qualify as nuisance, especially the lower end ads served by ad networks. Ring-tone and wallpaper download sites and generic messages about education, dating or religion feel a bit passé. But mobile ads can be something very different – information closely related to the application itself, when and where the user is and even information about the user. Such ads have the potential to be more relevant to what the user is interested in and thus provide real value.

This is of course called contextual ads and versions of these have been around for some time. Location context is what set this in motion followed by relevance to the application ads are placed in. If the user is willing to share personal information, contextual can be expanded to age, sex and interests. If the results are very relevant ads, chances are, users will share their personal information as long as it is not used for other purposes. At mJetz, to our surprise 70% of registrants voluntarily provide this optional information. But in order for contextual to work, there are two conditions that have to be met in order to improve the value of mobile ads?

  • Mobile apps have to deliver better contextual keywords that are focused on getting ads with as much relevance and value as possible, not just click-troughs.
  • Mobile ad networks have to improve so that they only serve ads directly related to the contextual keywords associated with the mobile app. No match – no ad!

Right now we are in a transition period where ad networks serving the premium phone app market are better at this than the mass market networks. Despite this, there are plenty of nuisance ads slipping though. Until both conditions are improved further, we nearly need a filter function that screens out nuisance ads from the mobile user experience. It is better to have no ads, than ads that are a nuisance and reduce the total user experience. When only relevant and valuable ads are shown, the user experience will improve – as will click though rates.

Tuesday, September 14, 2010

How many Mobile apps do you have on your phone?

The ME Mobile Entertainment guide reported last week that the average SmartPhone user has 27 App installed on their phone - (see article). This is based on Nielsen’s latest Apps playbook report on an August survey of 4,000 US mobile subscribers. The good news is that this number is up from 22 the year before – an increase of 25%. The bad news is that during the same time, the number of available applications have skyrocketed. Depending on phone type, there are over 200,000 iPhone apps and over 40,000 Android apps advertised. It seems like out of this overwhelming supply, only a miniscule number actually end up on actual phones. Even if you take the number of Smart Phones (50 million) into account – the total number of installed apps remains relatively low with the average app only installed on 26,000 phones – [26 apps/phone * 50 million phones / 50,000 average available apps]. Since big apps like Facebook, Weather Channel, Google Maps and Pandor have huge penetration, the actual average app seems to be installed on 10,000 phones or less. The notion of ‘the long tail’ was popular some years back – this is really a long long tail! What is going on?

It seems like the average user downloads a relatively limited set of apps on their phones and only gradually add more, in this case on average five more/year. The current average of 27 easily encompasses the 18 categories (games, weather, maps/search, social networking etc.) described in the study + a couple of more. This represents one dominant app in each category and a couple of new interesting ones as they come along. It also no doubt represents special unique interests, niche apps that appeal to a specific individual. Using these 27 apps on a regular basis involves quite a bit of time and there is most likely natural limit to how many apps people will ever have on their phones. But our guess is also that today’s phone user interfaces have a lot to do with how many apps people have and use. Why is that?

27 icons fill between two and three pages on today’s smart-phone matrix User Interfaces. Adding more apps means more pages and sooner or later the flipping of pages to find the app you are looking for is simply a bad User Experience. Most UIs are also disorganized with icons placed in random order and while it is possible to change placements, this is not necessarily intuitive, again a bad User Experience. Between these inherent limitations of the UIs and the fact that 20-30 apps cover the 18 categories users are looking for, it is unlikely that we will see a dramatic increase, like a doubling, of the number of Apps the average users have. In order to move this number up substantially, we need a much better User Experience in the form of a new User Interface!

Wednesday, September 8, 2010

Mobile Simple Syndication - Mobile Friendly RSS

In an earlier blog we discussed the advantages of RSS feeds as a way to convey a lot of information, like news headlines, to a mobile phone. They work well when we want to quickly glance at news, sports or blog headlines and read a short summary or see a picture. But there the mobile friendliness often ends. When we click for the full story we are taken to a full website. If we are talking about a blog, that is fine as we get the text we are looking for. But news or other media sites often take us to full websites filled with tabs, columns, ads and combinations of flash and java-script. Even browsers on today’s high end smart phones have problems finding the relevant story among these full web pages of information. There is a problem with RSS usability depth on mobile phones.

This is understandable as RSS feeds were developed to deliver Real Simple Syndication feeds from regular web sites that take us to these sites when we click on the feed. Will this mobile usability depth problem be solved when all phones can handle regular web pages? Most likely not as web browsers and web pages keep improving as fast or faster than mobile phone browsers. Unless we believe that PC and Internet innovation will come to a sudden stop so that the mobile phone world can catch up, mobile phones will be a couple of steps behind the innovation curve. Does this mean that RSS feeds will always have limited usability depth on mobile phones? Not necessarily.

If we develop a standard for Mobile Simple Syndication - MSS where we are taken to a mobile friendly sites instead of a full web site the problem is solved. If implemented, MSS will revolutionize how we deliver mobile web information to the phone and make it usable on all phones!

Wednesday, September 1, 2010

Do some phones make you "click happy"?

Mobile Ad firm Chitika published some research last week under the controversial headline ‘Android Users 80% More Valuable Than iPhone Users’. While the headline was obviously designed to grab attention, the underlying research showed that click-through rates on mobile ads on Android was twice the rate of iPhone. Following the publication, several blogs discussed these results arguing for or against such a conclusion. One comment was that Android users are newer and therefore “click-happy”. Others said that the results were a fluke and would even out over time. The article clearly states that as Android market share grows these numbers may change noting that it will be interesting to see how or by how much.

The Chitika analysis describes something that is well known in the print and TV advertising industries, different target groups are more or less receptive to specific ads and to ads in general. By showing that this is also true with mobile ads they start a discussion about effectiveness of mobile ads in general, in this case based on phone OS, which will hopefully lead to a discussion about effective ways of presenting mobile ads on mobile phones in particular. There are a couple of areas that are bound to have huge impact on the effectiveness, as measured in click-through rates, of mobile phone ads; relevancy and placement. Let us start with relevancy!

Contextual advertising is one of the buzz-words of mobile advertising and it is assumed, correctly, that the more relevant and ad is based on the context in which it is being displayed, the more interesting it will be to the user resulting in higher click rates. One of the great drivers for this is of course location information that today is available on nearly all high end smart phones. But equally important is information about the user gained from user registration information or usage patterns showing history and trends of interests.

All this contextual information comes together as keywords contained in the ad query sent from the phone or application to the ad network. It is up to the ad network to deliver an ad that is highly relevant to the user at the time it is displayed. If this relevancy is very high, we can expect click through rates to reflect this. High relevancy leads to high "click happiness". The same can be expected from great placement, but more about this in a later blog.