In 2018, the global mobile internet population stands at some 3.7 billion unique users, and users spend a reported 69% of their media time on mobile devices.

The statistics have never been clearer about why advertisers need to be present on mobile. But far too many advertisers still view mobile as an “add-on”, according to Chris Childs, Managing Director UK at TabMo, a creative mobile demand-side platform.

“I’d like to see mobile advertising become more thought-of, more bespoke, and less of an add-on,” he says. “At the moment, we’re still seeing a situation where most of programmatic marketing spend is going through cross-channel platforms, which don’t cater to each channel individually. A lot of the ad formats that are being run were designed for desktop – even though mobile has more usage now than desktop. In my eyes, that’s crazy.

“Mobile is such a different experience compared with desktop. The screen is different, the technology is vastly more powerful; and the data is more powerful, because it’s based on location.”

But brand marketers who have been in the industry for several decades are prone to viewing mobile marketing as something “slightly intrusive” that hasn’t yet found its feet, says Childs. And for those marketers, there is still a lack of information available about what’s possible on mobile.

I spoke to Childs about some of those possibilities, including how “Drive to Store” mobile advertising is allowing retailers to quantify their success on mobile for the first time; the pros and cons of augmented reality on mobile; and how the next generation of mobile devices could change the way we advertise.

The power of location-based marketing on mobile

“One of the most innovative recent trends that we’ve been seeing is the use of “Drive to Store” mobile campaigns,” says Childs. “Retailers and brands are using mobile advertising to physically drive footfall to their stores.

“A lot of suppliers in this space are launching variations on this product, but the way ours works is that an ad gets served to a user’s mobile phone. The advert tells the user that there’s an offer redeemable at a particular store or supermarket; if they tap the ad, it will open a map that directs them to their nearest store, based on their current location.

“We’ve recently started tracking footfall in real-time to determine how many people went to a store as a result of an ad, which allows us to calculate exactly how much a retailer would need to spend to drive footfall to their store.” According to TabMo’s research, the average cost of a “drive-to-store” customer is $6, with one offline visit made for every 20 clicks on an ad.

Is cost-per-offline-visit the future of mobile advertising?

Childs says that while brand marketers know that they need to be advertising on mobile, to many of them, it has seemed like the medium lacks impactful advertising solutions. “So, the fact that we now have the ability to drive users to store and measure it in real-time gives retailers, for the first time, a way to quantify their mobile spend.

“In the last two years, mobile has found its feet as a location solution. I can target somebody in a coffee shop because I know they’re using their mobile phone, and send them a message that says, ‘Leave that coffee shop and come and buy a pair of jeans in my shop across the road’. That’s incredibly powerful.

“However, [Drive to Store visits] shouldn’t be the only way mobile is measured. Because the fact is that even if I don’t go to that shop across the road, I still saw the ad.”

Vector graphic showing a hand holding a mobile phone with a location pin and a map on the screen.

For this reason, TabMo calls its own location solution “Branding to Store” rather than “Drive to Store”, in a bid to remind retailers of the added value they’re getting via impressions.

“Mobile is a great location solution, but it shouldn’t be the only way its value is assessed. And in fact, taking location aside, all we’re trying to do with advertising in the first place is reach people. And at the moment, mobile phones are probably the best place to reach people.”

Childs points to the fact that a desktop computer might be shared among multiple users, such as a family, whereas with mobile, you’re guaranteed to be reaching a single person. “We know the data is more accurate, and a better indicator to advertisers of intent to purchase. A phone will also follow a person all day, allowing advertisers to run sequential messaging based on the time of day. The possibilities are better – which is why mobile needs its own strategy that takes advantage of those possibilities.

“I’d like to see the use of the term ‘digital’ vanish when it comes to mobile, because the experience is so different.”

The problem with AR advertising

Augmented reality is a much-vaunted possibility for the future of advertising in general, and mobile in particular. When done effectively, AR on mobile can be engaging, interactive, fun and memorable. However, despite its potential – and a number of attractive case studies over the last few years – very few brands are running augmented reality ad campaigns.

“Augmented reality advertising has been possible for quite some time,” says Childs. “Back in 2014, Pepsi ran an AR campaign within bus shelters where people could hold their phone up to the bus stop window, and different things would happen.

“Four years on, we’re not seeing that many brands use this technology. I think it’s probably due to financial constraints – if you think of the amount of money a campaign like that will cost to produce, how many people are actually going to experience it? For Pepsi, the key wasn’t the number of people who walked past a bus shelter and saw it – I never saw it – but the number of people who talked about it. We’re still talking about it now!

“The problem is that once someone’s done it, it’s no longer new.”

Childs dubs this phenomenon the ‘Pokémon Go effect’, after the hugely popular AR mobile game that everyone predicted would spawn a legion of imitators, potentially giving rise to a new wave of augmented reality games. Yet in practice, very few materialised.

Pokémon Go: Zappar founder tells us what it really means for augmented reality

“One of the other big problems with AR is budget allocation. If you think about the core of a brand’s marketing budget, it goes on media – television, digital spend, search. Where does AR sit in terms of budget, and how much impact does it actually have for the amount of money it costs? What is the return on investment – and how do you measure the ROI for something like that?”

Some advertisers are instead branching out into more immersive experiences that confine themselves to the mobile screen. Childs describes a furniture retailer that has developed an immersive, interactive ad experience on mobile using 360-degree imagery.

“The ad allows you to pick four or five different items to go in your living room – a sofa, a coffee table, a carpet, shelving – and when you tap on the ad, it recreates the living room with those items in it. Then you can use your finger – or the gyro feature on your phone – to look around the living room.”

Childs anticipates that in the future, we’ll see more advertising that makes use of communication between different platforms. This could be a smartphone interacting with a billboard, or it could be mobile advertising that’s supported by sequential messaging on out-of-home screens or connected televisions.

“To get advertising right, we need to understand what message can be told best on what channel at what time. Different devices have the ability to talk to the user about slightly different variations of what they’re promoting. It hasn’t really taken off yet, but I think that’s an interesting place for advertising to go.”

Person using a mobile phone while watching TV

What the future holds for mobile advertising

Other than cost, what are the factors most likely to influence how mobile advertising develops in the future?

Childs believes that the advent of 5G, which is slated for 2019, will be a game-changer for mobile advertising due to the vast improvement in download speeds that it heralds.

“Right now, there are file size limitations when it comes to mobile advertising. You have to be very careful to only run adverts of a certain size – otherwise the ad might not even render, but the advertiser will still be paying for it. You have to make sure you’re not producing something which is vastly over-complicated with a huge file size that will never make it to the consumer.

“But we want mobile advertising to be memorable and engaging, and for that to be possible, it needs to allow the user to interact with it. Things like asking a user to shake their phone or watch an animation – these all require larger file sizes.

“5G will help to change all of that, allowing advertisers to be more creative and reach people more quickly, and giving them more freedom with design.”

Initiatives like the Coalition for Better Ads are also helping to change mobile advertising for the better. Many of the poor ad experiences that users have to endure on mobile are born of the fact that mobile advertising is viewed as an add-on to other channels, resulting in things like television ads and banners designed for desktop being displayed on mobile.

The Coalition is helping to eradicate many of the ad types that aren’t suited to mobile, along with unpopular ad formats like intrusive interstitials and autoplay videos with sound.

Childs also credits the GDPR for “re-confirming” the importance of contextual relevance in advertising. “With less third-party data available, how else can we ensure the ad is relevant? The overuse of data has, in some cases, led to a lack of focus on context. Hopefully, GDPR will help to increase the significance of contextual targeting and help to increase the value of publisher first-party data.”

GDPR: What future for first, second and third-party data

This trend has coincided with a rise in content quality and quantity, he says – providing even more material for advertisers to contextually target their ads. And on mobile, contextual targeting goes a long way towards making advertising feel less intrusive.

“We’re continuing to see more and more premium content available on mobile within which advertisers can reach their audiences. This should help to join the dots as we’re continually searching for that perfect mix – audience, creative, context, location.

“I think this will play a big part in the future of mobile advertising: a return to the significance of where an ad is being placed. An advert for a car brand is much more powerful placed in an article about car-buying than placed within a recipe.

“One of the hardest things in mobile is making an ad engaging but not intrusive. If an ad is carefully targeted, it should be more engaging, because it’s reaching the right person. And it comes across as less intrusive if it’s relevant to the content the user is consuming.”

How the next generation of mobile devices could change advertising

More interactivity and more contextual relevance will both be significant developments in the mobile ad space, but they won’t completely revolutionise the way that advertising is carried out on mobile. However, the next generation of mobile devices might.

“The device itself is the vehicle for the advertising, and therefore the most important factor in what facilitates a mobile ad,” says Childs. “We know that phone companies are working on the next generation of devices. Samsung is developing a line of phones with ‘bendy screens’, where the screen literally folds up. Another concept that I’ve seen is a phone that’s transparent – it looks like a piece of glass.

“Mobile phones with projectors built in are also just around the corner. What this means is that people will consume even more media on a mobile phone, because it suddenly becomes a way to watch films, for example.

“What does this mean for advertisers? It means there’s more space to advertise, more real-estate. The limitations of mobile have always been the size of the screen itself – if I’m advertising on a 55-inch TV, I can put all sorts of things within the creative. But if you ask me to run that same creative on a mobile phone, I’ll tell you that’s pointless, because you wouldn’t be able to see half of the features.

“If I’m designing an ad that’s supposed to be displayed once the phone is used as a projector, that changes the possibilities.”

A smartphone on its side, projecting a holographic image of a jellyfish

Mobile phones with in-built projectors could be a game-changer for mobile advertising. (Image by Karthikch98, available via CC BY-SA 4.0)

Childs also predicts that these developments will change the way that people interact with their phones, unlocking powerful opportunities for advertisers. “Right now, mobiles tend to be used for what we call ‘snacking’. With a TV, you’ll sit down and spend two hours in front of it; with a mobile phone, you’ll unlock it, and probably lock it again within three minutes. Our rule of thumb for advertisers is that they have up to three seconds to grab someone’s attention.

“But once people are using phones for things like watching films, that changes. Suddenly, it’s not a ‘snacking’ device – people are going to spend more time on it.

“If I can unfold my phone so that it becomes a tablet, am I going to sit in front of it for a longer period of time? The answer is probably yes. People watch catch-up TV on tablets and phones with larger screens. Tablets are often given to young children to distract them – in the hands of a toy advertiser, that’s very powerful.”

And, of course, there’s the benefit to being one of the first to deploy a brand-new type of advertising, just as Pepsi was with AR.

“The first advertiser to put an ad on a bendy screen and make use of that technology will derive huge PR benefits from it,” says Childs.

However, he stresses that it’s impossible to know exactly what the next generation of mobile devices will consist of. Companies are notoriously secretive about their future plans, and some concepts can take years to become commercially viable. (A case in point: Samsung first debuted its flexible phone in 2013, but the launch was only recently confirmed for this year).

With that in mind, how can advertisers and brands remain at the cutting edge of mobile advertising if they can’t be sure about what’s coming next?

“You need to have an organisation and an attitude that adapts very quickly,” Childs replies. “You need to have an imagination that allows you to move very quickly.

“Advertisers are already designing concepts and ideas to be displayed across a multitude of different channels – billboards, desktops, mobile phones, TVs, radio stations. So, in fact, the same principles apply to designing for a new generation of technology. The key is having a core headline or message that can be easily adapted to the screen or channel that you want to display it on.”