San Diego Internet Marketing Blog

Websites. Pay Per Click. SEO. Social Media.  What's the next step?  If you're reading this, you've probably already guessed that it is Mobile Marketing.

What exactly is mobile marketing?  One definition is that it is "a form of marketing that uses SMS or MMS to deliver a specific promotion to mobile phones or other mobile devices."  You're probably already familiar with SMS, which stands for Short Message Service.  SMS is the basic text communication service of your cell phone or mobile device.  MMS stands for Multimedia Messaging Service and is a more rich version of SMS since it allows your mobile device to send and receive images, audio,or video.

You've likely already been exposed to some form of mobile marketing, or perhaps you've voted for your favorite contestant on American Idol through your cell phone.  In either case, you may recall that a you were required to text a phrase, e.g. "join" or "vote", to a special telephone number that was significantly shorter than regular phone numbers.  This special telephone number is known as a Short Code, which is where you addressed your SMS or MMS message to.  The texted phrase is known as a keyword (similar to search engine marketing terminology).

What makes mobile marketing effective?  Simply, the reach of mobile marketing is significantly larger and more immediate than traditional internet marketing and search engine marketing.  For example, 95% of text messages are opened and read.  Further, emails are typically only read within 48 hours on average, while text messages are opened and read within 4 minutes.  Today there are approximately 276 million Americans using mobile phones.  Worldwide mobile reach is 4.8 billion, while worldwide internet reach is a "mere" 1.7 billion, with almost 5 times more mobile devices than there are computers.  The numbers speak for themselves, mobile marketing's reach is immense, which explains why 89% of major brands are currently planning or are already engaged in marketing via mobile phones.

As of August 2010, 38% of US mobile phone users were "very comfortable" with mobile advertising and feel that it "serves an important purpose" as opposed to 12%, who are "not comfortable at all" and feel that it is "intrusive" (source: InMobi and comScore, Inc.)  Undoubtedly, these statistics will shift over time as mobile marketing continues to penetrate the market and our society as a whole.  However, if you're looking to "take the next big step" in digital marketing, then start a mobile marketing campaign.

Four years ago, an exciting new form of internet marketing called social media started to take shape.  Ten years ago, search engine optimization was in its infancy.  Keep in mind - mobile marketing today is where SEO and social media were in these respective timeframes.

Location based applications are hot right now.  Foursquare, Gowalla, Facebook Places - the list of services is growing and users are catching on.  Not familiar with these types of applications?  Put simply, these applications are a way for you to "check in" to a specific venue or location (e.g. a restaurant, park, retail store) through a mobile device (e.g. iPhone, Android phone) and share that location with your friends and followers.

What's the value, you may ask?  By sharing their locations, users can see where their friends are and schedule a spontaneous meetup if they are within close proximity to one another.  Most of these services also feature a "mayor" (in Foursquare speak) - this is the user who has checked into a particular venue the most.

So why would anyone be a "mayor"? Well there is an element of having bragging rights, but probably more importantly, businesses are starting to reward their "mayors" special perks, such as a gift certificate or special discount.  Businesses are essentially rewarding customer loyalty and these customers are competing for these special rewards by frequently visiting their favorite stores.

What's in it for businesses? Location based marketing.  With these types of applications, you can market to consumers if they are in close proximity to your business.  In Foursquare, for example, a "Special Nearby" banner shows up if you have a special offer available and a consumer is nearby to your business.  Through this technique, you can attract new customers because they are just around the corner and may be interested in your special offer.

Businesses can also foster customer loyalty and repeat visits.  One of the most popular examples is the "free chips and salsa" that you can get at your local Chili's restaurant, simply by checking into Foursquare and showing your check in screen to your server.  Just recently, McDonald's head of social media, Rick Wion, mentioned that there was a "33% increase in checkins" from a Spring pilot program using Foursquare.  With this campaign, McDonald's randomly awarded $5 and $10 gift cards to those who check into Fousquare.  How much did this cost the large corporation? $1,000 for the gift cards - probably one of the most inexpensive marketing campaigns run by the fast food giant.

What's the downside?  Well, according to a Forrester Research report, only 4% of US online adults have ever used location based applications - definitely nothing to get too excited about - yet.  Even certain business staff who are supposed to be aware of these campaigns are not familiar with their existence (the local Chili's management wasn't aware of the free chips and salsa deal, or even Foursquare, when I showed the check in screen to them).  But like social media marketing and marketing in general, experimentation is key.  While the numbers don't indicate a significant reach for any campaign, the McDonald's campaign suggests that good results can occur with an extremely low investment.

Will it work for your business?  Like any other marketing initiative, experiment and see.

According to an article from Mashable, big brands such as AT&T, Expedia, Amazon, JC Penney, and ADT each spent several million on Google AdWords during the month of June 2010, with AT&T leading the pack at $8.08 million.

This is interesting since we all generally assume that these brands don't necessarily need to drop such a large investment into online ads with their huge brand recognition and large visibility in offline channels (e.g. TV, print, etc.), but the reality is that  marketing on search engines has such a broad reach, which translates into a huge ROI for the corporations involved.

If paid search is needed by large, well known brands, then the need for online ads is even more critical for smaller, local and less well known brands.  As mobile marketing continues to grow, paid ads will become even more targeted as ads can now show up depending on your local proximity to a particular restaurant, store or any other business.