Eric Mugnier, head of M&C Saatchi Mobile's North American business, reflects on the transitions he's had to make to ensure that he maintains focus on driving revenue from mobile spend, and the growth of mobile.
Mobile is the fastest growing, and most widely adopted media channel of all time. But it hasn't always been perceived that way by agency suits, brand experts, and mass-media marketers. Just as brands were getting into a groove with digital, cellphones went from talk and text to pinch, snap, flick, and zoom. If the Internet revolutionized communications and media, mobile is fulfilling that promise by putting these tools and features into the hands of billions.
Today, mobile is so much more than a device or technology that makes this experience possible. It is a concept, a growing framework of always-connected things. Mobile increasingly drives changes in user experience and interfaces across the digital realm. While the industry at large pays lip service to the opportunities that mobile brings to the game, the channel remains woefully neglected and underserved.
Before the rise of smartphones, mobile marketing and advertising was way out on the fringes. That also holds true for the men and women who embraced mobile early. These trailblazers didn't just cop out and check the box on mobile under their emerging or experimental budgets; they pushed toward mobility while most held back.
Here at ClickZ, we wonder where these Mobile Trailblazers are today. Was it worth the struggle? After going against the grain for so many years, are they finally beginning to see the world they always imagined? These are their stories about all things mobile.
When Eric Mugnier joined the founding team of Inside Mobile in 2006, the mobile landscape was complex, entrenched, and surrounded by walled gardens. As the head of M&C Saatchi Mobile's North American business (M&C Saatchi acquired Inside Mobile in 2010), Mugnier has called Los Angeles home since last year as he opens the agency's second U.S. office there. "We're a performance-based company, which sometimes might be a little bit controversial since we're part of a bigger group that is very creatively led," he tells ClickZ. "For us, a download is great but a user is much better so we focus on making sure that the dollars that we spend on behalf of our clients are actually generating revenue…We're not just taking the dollars to tick the mobile box, per se."
ClickZ: Can you reflect on the shifts or transitions you've had to make to ensure that you maintain focus on driving revenue from mobile spend?
Eric Mugnier: Over the last seven or eight years that I've spent in mobile, mobile media has really picked up. I would say three or four years ago, that was the turning point for us and for brands. That's when some of the brands that we worked with started to generate direct revenue from the mobile spend itself. Before that, there was innovation, there was, "It's cool to be in mobile, we need to do mobile." So we had those great mobile campaigns that were driving traffic, but didn't bring any revenue to be completely honest...Three years ago, that's when we started to see the shift. Brands started to spend X amount of dollars and generate more than that. So that's where the ROI (return on investment) for some of our clients started to become constant. When that shift happened they wanted to spend, obviously as long as you can reach the right consumers, as much as possible. For example, we have clients that are spending today more on mobile than they do online because it's a more profitable, customer-acquisition channel. Over the last three years, I've got two or three clients that have every year doubled their mobile budget. I'm not talking about a very small budget, an important budget, and they've been doubling them every year because it's so efficient. Having said that, I'm not saying that mobile will work for any brand in any situation. There's still a lot of work to do to make it work. But we have more and more user-experience-type of apps and products that are generating positive ROI for those brands.
ClickZ: What changed there to start driving that revenue? Are there certain channels that you're finding more effective or features that you're taking advantage of?
Mugnier: The mobile space is a very fragmented place. It's a very fragmented industry and it's very different from online buys or optimization or tracking. Everything is very different because it's very segmented. First of all, it's very specific so you need to have very specific skills or knowledge about the industry and fragmentation just for simple things like being able to measure on mobile, being able to optimize on mobile. And if you're coming from an online background and you believe that online and mobile are very similar because it's digital, it might work in some instances when it's mobile web or online only. But when it starts to be very different and very difficult is when there is an app store in the middle of the user journey, where you've got the app store that is a big black box that no one can actually gets into. So trying to track a user coming from a mobile banner, going to an app store, and then opening the app and doing things with their apps - to be able to track them along that journey becomes very difficult and fragmented. So I would say that the tactics, first of all, is to have something that is trackable, that you need to have the right tools to be able to do that, and understand that you don't plan and buy the same way that you do online. And also, the rates are very different from online today. The price, or the cost of the media, if you know specs of the industry, is still a lot cheaper than online. It becomes very efficient when you know how to buy and at what price to buy it, and you have the capability to track it and to optimize based on that spend.
ClickZ: What's grabbing your greatest interest and attention these days in mobile? Are you pleased with progress of things like measurement, tracking, and following your efforts down those funnels?
Mugnier: It has been a challenge and it still is a challenge. We're definitely in a much better place today than we were 12 months, or even six months ago. The improvement and the tracking tools that are available on the market now, it's not 100 percent accurate. If somebody is looking for something that close to what is available online, it is not yet like online. But we're getting closer and closer, which is the good news. That has been a challenge and definitely an issue. A lot of players in the mobile space now, they all see the forecasts of smartphone adoptions, and they want more users on their mobile consuming content and data...It's why Facebook is paying that much attention to mobile users, because (the majority) of their users are actually accessing Facebook via mobile. For instance, 30 percent of their revenue is coming from mobile...It's all very new, but they are very mobile specific now. The fact that everyone is seeing that trend going up and up makes a lot of players in the mobile space say, "I can't believe mobile is growing so fast, I need to be a part of it."
ClickZ: Are you confident that mobile will reach the accuracy that we're used to online, or will there always be a gap there?
Mugnier: It's significantly better than it was 12 months ago, like I said, and in 12 months time I'm sure it will again be 100 times better than it is now. I've got no doubt that at some point the platforms will converge. However, I don't think that's going to happen very quickly. My own estimation is we're probably between two and five years away from having a true convergence, but it's going to take time. Even companies like Google with their enhanced platform that is supposed to make it platform agnostic with online, mobile, and being able to optimize it, is not there yet. It needs a lot more work. So even a company like Google that has always focused on mobile - they were the first one to acquire the best mobile network at the time, AdMob - they're not capable now of having a platform that is truly able to converge the two platforms - online and mobile. That's going to come, that's for sure. At some stage, that's going to be a much more seamless or a much more cross-platform experience than it is now.
ClickZ: Where are you seeing momentum or putting higher time and investment on behalf of your clients?
Mugnier: There is a lot of noise around ad exchanges, DSPs (demand-side platforms), and mobile networks...Networks are still very strong. I'm not saying that they are done, but I think they are definitely in a very delicate position right now. Ad exchanges' inventory is growing so the ability or the necessity of going through an ad network becomes less and less important. It's still very important, I'm not saying that it's the end of the ad networks now. But if you look at who is delivering the most impressions today, if you look at the U.S. market, it's Facebook, Twitter, Pandora, or the large publishers like that...All the networks will have less and less direct inventory available, so everything is going directly through publishers or ad exchanges. The mobile DSP world and plugging directly into your real-time bidding platforms and accessing those ad exchanges in a real-time bidding basis, it's definitely something that generates a lot of buzz right now. The problem that we have, that I'm seeing right now with pure RTB (real-time bidding) is the scale. So we can be very efficient, but when we try to scale, we can't keep the same efficiency at scale. We've got a big issue right now in how to scale mobile DSP and ad exchange inventory. There's still a very small portion of that global mobile inventory that is available on an RTB basis through those ad exchanges, but Facebook is not, Twitter is not. A lot of the relationships like what you get through ad networks or directly with publishers are not available through RTB.
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Matt Kapko has been writing about mobile since 2006, before it became cool. Based in Long Beach, CA, he has covered mobile entertainment, digital media, marketing, and advertising for several business media outlets. A former editor and reporter for RCR Wireless News, paidContent, and iMedia Connection, Matt is a regular freelance reporter for ClickZ. You can follow Matt on Twitter at @MattKapko or drop him a line at firstname.lastname@example.org.
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