Advertising, Promotion, or Commerce?

Wireless advertising, m-commerce: What’s the difference, anyway? I’ve been getting some mail from readers indicating some understandable confusion on the whole topic. So, before we delve into the topic of early adopters and what they are doing, I thought it would be helpful to look at how wireless advertising and m-commerce are related.

As we all know, the distinguishing characteristic of advertising is that a company pays to have its message displayed somewhere — hopefully by an audience that it feels will be receptive to its message. Promotions are a subset of advertising, designed to provide incentive to the consumer to take a particular action in line with the message. Commerce, on the other hand, is typically thought of as what happens after a successful marketing campaign. Once a consumer becomes aware of his or her need and the company’s solution to that need, he or she will go to the store, the catalog, or the Web site and purchase the product or service. Simple, right?

When you think about the Internet, for example, the distinction between advertising and commerce is usually a clear one. Banner ads, sponsorships, and email are all forms of advertising designed to encourage immediate or deferred commerce. The Web site itself is often commerce-enabled, allowing immediate results from the advertising. Banner ads that allow you to click through to an order form blur the distinction a bit — but still, it’s a pretty simple equation.

Now, let’s take a look at the wireless environment and see whether the distinction holds there.

Everyone agrees that in today’s environment, getting a mobile user to the Web site by any means other than a simple push of a button is not likely to happen. (Can’t you just see yourself laboriously typing in a URL from your tiny cell-phone buttons?) Most people also agree that today’s mobile devices are not about surfing but about assisting the user in accomplishing a specific activity that the user wants accomplished at that moment. This may well change when reliable voice-recognition systems are in place; but, so far, the name of the game is immediate visibility. So, if a company’s presence isn’t immediately obvious to the user, the game’s over.

On a cell phone, a company’s presence within the so-called “walled garden” of a major wireless carrier is dependent on that carrier’s selecting the companies for inclusion on the wireless-Web menu. And — no surprise — the company pays dearly for this placement. On the Internet, these payments are often called “slotting fees” or “premium-placement fees.” But whatever they’re called, in my book we’re still talking payment for presence — in other words, advertising.

Now here’s the confusing part. The entire wireless “Web site” of some companies may consist simply of the advertising message or promotion that is reached when a consumer clicks on the company name. There is nothing else there.

Let’s look at a fictitious example. Say a retailer runs a wireless banner that says, “Shop at your local cooljeans at 345 Broadway.” We’d call that advertising, right? Now let’s say that the banner offers you a coupon for a 20 percent discount on a pair of jeans at your local store. OK, that’s a promotion, right? Say the banner enables a call through to order the jeans via your phone at a 20 percent discount. We’d say that is m-commerce, right? Now say that the same coupon could be redeemed at the store or used to call through to order the jeans online. We’d call that… Hmm… what would we call that?

You get my point. With wireless, the difference between advertising and commerce is not always clear. To be sure, we’ve seen some of this blurring online with banner ads that allow you to link or even order directly from the ad, but given the inherent space limitations of mobile devices, we can expect to see even blurrier lines of distinction in the wireless world.

Ultimately, whether we call it advertising or m-commerce, those who will win at it will be those companies that figure out what consumers truly value when it comes to receiving information and making transactions on their mobile devices.

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