Boosting Spending on the Smallest Screen, But Not Too Much, Has Direct Impact

Marketers should spend more on mobile: Just ask the Mobile Marketing Association.

Marketers should spend more on mobile: Just ask the Mobile Marketing Association.

That claim is no surprise coming from the industry’s trade group, and might even provoke eye rolls. But there’s a key reason to believe the MMA, backed by its cross-device Smart Mobile Cross Marketing Effectiveness (SMoX) research, as the group’s CEO, Greg Stuart, sees it: His board is made up of nearly two-thirds marketers — including executives of Coca-Cola Co. and Unilever — who have closely supervised and participated in the work.

Unilever, whose Magnum ice cream brand is the focus of the latest SMoX study, is putting credence in the results and putting them to use, said Luis Di Como, Unilever senior VP-global media, who sits on the MMA board. “We have advertisers. We have mobile players. We have Facebook as well,” said Mr. Di Como. “We have a good industry representation.”

MMA research has been vetted independently by the Advertising Research Foundation, Mr. Stuart noted. And its studies have been conducted with large panels of between 500,000 and 1 million consumers under the supervision of well-regarded marketing analytics firm Marketing Evolution.
The eight published SMoX studies to date, conducted since 2014 with such marketers as Walmart, Coca-Cola, Mastercard and AT&T, concluded that all the marketers would have fared better — either selling more products or converting more customers — by increasing mobile media’s share of their media budgets to the 15%-to-20% range from 5% to 9%, Mr. Stuart said.

Somewhat ironically, the one mobile player in that group — AT&T — had the lowest mobile share of spending going into its study, he said.

“Mobile is priced at half its value,” Mr. Stuart said, based on the sales or conversion impact per dollar spent.

That’s not to say the gains will hold up if marketers pile their whole budgets into mobile. Marketing Evolution CEO Rex Briggs has pointed out in numerous interviews and presentations that optimal spending on mobile tends to top out at much lower levels than other media, because it doesn’t take as much frequency to make an impact as other media.

Saturation point
Mr. Stuart said a mobile video ad only needs to hit its target three times to reach “total saturation,” versus a frequency of 12 to 15 for cable TV.

While it’s not entirely clear why similar video advertising works and wears out faster in mobile than cable, it does raise questions about whether what counts as an impression is really equal between the media, and whether, for all the concern about digital viewability, concern should perhaps be greater about TV viewability.

Of course, comparing mobile and TV is also complicated by the relative complexity of mobile. Where TV spending comes largely on 15- and 30-second ads, mobile encompasses display, video, native and search with parameters that include place and time. Part of SMoX has been looking at optimizing budgets not just by total weight, but also by type of mobile creative and targeting variables.

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