Mobile Campaigns Transcend SMS

SMS (define) has always been the essential staple of mobile marketing, but phones are becoming content platforms in their own right. As consumers increase their comfort with the functions of their increasingly advanced handsets, stuff like mobile apps and searching, is the almighty text message about to be knocked off its throne, in favor of flashier marketing applications?

In a word, no. But that doesn’t mean the groundwork isn’t being laid for flashier mobile marketing applications.

It’s All About the Equipment

Over 90 percent of handsets in the U.S. market are capable of sending and receiving SMS communications. The addressable audience for WAP (define) is far lower: about 60 percent. Mobile TV and other forms of video on phones are even more limited.

“It really comes down to what handsets are capable of, and the lowest common denominator is text messaging,” said Laura Marriott, executive director of the Mobile Marketing Association and a ClickZ columnist. “I do not see that changing in 2007.”

Still, the picture for mobile data isn’t entirely bleak. While SMS has the greatest penetration with consumers and marketers alike, comScore reports 19 percent of U.S. Internet users now access the Internet on cell phones and other mobile devices. Additinally, 3 percent of U.S. mobile subscribers, nearly 8 million consumers, have used the Web to access video, according to Telephia.

While it’s a slow process, adoption of devices with a QUERTY keyboard like the Treo and Blackberry are steadily driving mobile data usage up.

“It’s an area of differentiation for the Palm Treo smart phone line,” said Scott Hancock, director of marketing communications at Palm. “The primary reason that mobile Web adoption has been slow is the WAP experience on 12-key and other smart phones is terrible. It’s difficult to interact with any site when doing it on a 12-key phone or any device that doesn’t have a touch screen.”

Carriers Loosen Up

One obstacle to an explosion of mobile advertising is the obstinacy of carriers, which have often been accused of unnecessarily restricting access to mobile content and services. The operators are keen on preserving their gateway status to subscribers’ mobile content experiences. “Each carrier is thinking a little differently to how they might allow [content and applications],” said Erica Chriss, VP of business development for LimeLife, which offers mobile content to an audience largely made up of women. For that reason, she said, “There’s limited reach and limited inventory [for advertisers.]”

Chriss continued, “At the same time, advertisers are really interested in this medium. It is a personal, one-to-one connection. There are advertisers who want to be experimental and forward thinking. They see value in the medium.”

Smelling the money, carriers have lately begun to open up. Several now offer prominent search interfaces, making it easier for subscribers to jump away from the carrier decks to external Web sites. And, of course, they’re serving ads against those results. Sprint recently unveiled plans to begin selling ads on-deck, and began serving ads in October. Most others have cut deals that serve up content and ads to subscribers. Reuters has such relationships with Verizon and Sprint Nextel to grow its mobile content and ad revenue.

Visual Appeal

A good instance of carrier/marketer symbiosis is mobile couponing company Cellfire, which delivers coupons via several mechanisms, including a WAP site, a downloadable app and through a distribution relationship with Verizon. The application allows Cellfire to show company logos and product images in its coupons to create a richer experience, which in turn brings in more retailer customers.

The big change underway is the move toward more engaging, graphical experiences. It doesn’t matter whether that’s a WAP site, downloadable app, or pre-installed on-deck experience. The important thing is taking mobile experiences beyond 160 characters.

“No companies that do couponing on a text basis have any national customers,” said Brent Dusing, CEO at Cellfire. “It doesn’t have the brand presentation or images that so many retailers [and brands] thrive on.”

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