Mobile advertising began to take off in a big way 2007 and is set to become a major revenue driver for mobile VAS globally. In the process, it promises to deliver a significant subsidy on content related fees for the end user. Globally, mobile advertising is getting traction and is growing with the addition of new mobile media properties, sales side publishers and buy side advertisers. The global advertising marketplace is expected to grow from $1 billion in 2007 to over $10 billion by 2010.
However, in India, the fledgling sector is facing some growth hiccups that need to be tackled in the early stages for the sector to register a health growth. Active Media has been working on mobile advertising within the mobile marketing domain for the past six months.
Raj Singh, Managing Director, Active Media, throws light on the mobile advertising domain in India and the challenges and opportunities it faces here. “As market leader in mobile marketing and advertising, ActiveMedia Technology is tackling the increasing challenges of standardisation and relationship agnostics in the mobile advertising world. We are confident of success with the launch of next generation mobile advertising technology products in 2008,” Singh affirmed.
“The technology that we will be launching in a month or two for our clients would address the challenges in the market place for mobile advertising. The future of mobile advertising indeed looks very promising with a global reach of over three billion consumers. In India, it is also set to take off in a big way as the mobile subscriber based heads towards 500 million by 2010. In fact, the mobile phone has already established itself as a huge and vibrant brand-to-consumer communication platform,” he said.
Singh explained, “Technology solutions are needed that give more control to publishers over their inventory, while at the same time also delivering more control to advertisers over their advertising spends. This offers the potential to create a win-win for publishers as well as advertisers. We are using various products for delivering and managing mobile advertising campaigns.”
Speaking on the challenges faced by mobile advertising in India, Singh said, “The future growth of the mobile advertising industry faces a number of business challenges due to issues of confined contracts, unrealistic expectations, and unfair comparisons to conventional mediums and conflicts in revenue sharing between stakeholders. Similarly, first generation restrictions and immature mobile advertising technologies have started to impede growth due to use of proprietary and non-standard approaches. The combination of these business and technology issues is increasingly starting to have an adverse impact on all players in the value chain.”
He further said, “Current mobile advertising technologies are positioned to carry out only traditional advertisement and campaign management. Mobile advertising solution providers typically bring in their technology along with existing direct relationships with advertisers or individual agencies for marketing coverage. Unfortunately, the solution provider or marketing agency usually brings on board a limited set of advertisers. This heavily limits the earning potential that publishers have from their mobile media properties. Also, over time since the same set of advertisers promote the same set of products, subscribers start recognising advertisers over time. This leads to a steep decline in subscriber participation and the fees that advertisers are willing to pay the publisher.”
This apart, according to Singh, advertisers were setting unrealistic expectations from the medium and offering unconvincing rates to advertising inventory owners. On the other hand, publishers were getting locked in with a handful of advertisers and agencies, thereby opening the possibility of them creating a cartel type situation. “Evidently, this has an adverse effect on unlocking the potential for the publisher,” he said.