Nicole Kallmeyer

Smartphones make waves with marketers

Two years ago, more people said they would choose their mobile phones than their wallets if they had to leave home for 24 hours with only one item, according to the results of an IDC survey of about 2,000 people commissioned by Nortel. And even more people would likely agree today as separation between phone and wallet diminishes.

As our attention is diverted from big, stationary screens to smaller and more portable ones, businesses and marketers are following suit. Producers are waking up to the marketing potential of this tiny platform as an increasing number of consumers use it to shop, research products and services, and share information.

“Now you’ve got an out-of-home advertising device right in your hand,” says David Jacobson, the director of emerging technologies for PricewaterhouseCoopers in Toronto.

While large brands such as Much Music and Air Canada are steering their budgets to this advertising avenue, it is also opening marketing doors for small businesses. It is easier and less expensive to advertise on smartphones than in traditional media outlets, Mr. Jacobson says. “It’s a wonderful opportunity for small businesses to extend their reach.”

There are plenty of online services, like dotMobi, that help convert existing websites into mobile form, or build mobile websites from scratch. A small business owner can opt for a 2D barcode on a business card or flyer for customers to scan with their smartphones to gain access to additional information. Text messaging campaigns are another option for small businesses that can build a database of phone numbers. And with more funds and expertise, there’s the in vogue smartphone application, or app.

Hippopost, a Kitchener, Ont.-based mobile marketing company, has launched an iPhone and Blackberry app that enables consumers to transform their own photos into postcards, and then choose an advertiser to sponsor the cost of sending it. The app attained 55,000 downloads within a week of its launch.

The service bridges offline and mobile by allowing consumers to interact with businesses on their phones and then on a printed item that may sit on a fridge or desk, says Donal Byrne, Hippopost’s co-founder and chief executive.

“It’s mobile marketing disguised as consumer correspondence,” he adds.

These strategies vary in cost from a few hundred to thousands of dollars, depending on how they are utilized, says Michael Keefe, director of social mobile and immersive media at Remedy Communications, who led the mobile and online campaigns for major Canadian and international companies.

The launch of the iPhone in 2007 changed everything, Mr. Keefe says. The merging of phone and web coupled with the introduction of high-speed 3G networks launched the potential for marketing methods that are reinventing the way producers and consumers interact.

Smartphones let businesses and brands connect with consumers at “the right place, at the right time,” says Carey Mende-Gibson, vice-president of Guelph-based Mobi Marketer. A shopper’s mobile phone could receive coupons or product information from the very store they are browsing at that moment; or while strolling the streets of a particular neighbourhood, a smartphone user could access an app or the phone’s built-in GPS to research recommended eateries in close proximity. “You’re talking to consumers while they’re interacting and while they have the need,” Mr. Mende-Gibson says.

Smartphone advertising is also more reliant on consumers’ permission and desires. In the mobile realm, consumers are to a large extent wresting control over how and when they receive commercial information.

“The consumer has become the self-sumer,” Mr. Jacobson says, using this term to describe tech-savvy buyers who are “very choosy” and forgo hard-sell advertising for more interactive, engaging information they can share with their social networks.

“Everyone’s an expert,” says Brent Farrell, who heads business leadership for TBWA, a prominent advertising agency in Toronto. “Every consumer has a very strong opinion of what their online experience should be.”

While mobile marketing is slated for growth, it is still in its infancy, particularly in Canada. Last year, TBWA offered a “mobile 101” tutorial to all its clients, and Mobi Marketer does about half of its work with companies outside Canada.

“Canada is probably a year to 18 months behind the U.S. and two full years behind Europe and Asia,” Mr. Mende-Gibson says, citing lack of competition between Canadian carriers and the country’s relatively small population as a reason for delayed development.

There is also what Mr. Keefe calls “the Canadian challenge”: a deficit of research and statistics on mobile trends and usage in Canada. “Brand managers, products managers [and senior executives] don’t have hard data on Canada to be able to justify investment,” he says.

However, industry insiders agree Canada will catch up as carriers and smartphone models proliferate, costs decline and usage reaches a critical mass.

According to a PricewaterhouseCoopers media outlook report, mobile advertising spending in Canada will rise to $376-million in 2012 from $79-million in 2007. That’s almost a 400% increase in five years. And although mobile has a small slice of the entire advertising pie, it is expanding rapidly as budgets decline in print, television and radio.

Mr. Keefe calls 2010 the beginning of mobile marketing’s “golden age,” wherein loads of creative ideas and experimentation will emerge to discover the most effective business models.

“In the next two to four years every brand is going to need to be here in some meaningful way,” he predicts. “Mobile as a channel for marketers and advertisers has become part of the family.”