So, is 2014 finally the year of mobile?

Well, this ‘year of mobile’ has been coming for some time, but interviewees highlighted that they are starting to feel that mobile has finally emerged as a player on the overall advertising scene.

There are still huge discrepancies between time spent on mobile devices (a lot) and ad spending in the sector (relatively small).

According to some research, people spend more than 20% of their time on mobile devices, but ad spending is at 4%. That’s a multiple-billion dollar opportunity.

What is keeping mobile ad spend from growing?

Our research showed that a large issue for advertisers was mobile creative - specifically, the lack thereof.

The units are mostly small and prone to ‘fat thumb’ clicks in browsers, and most of the in-app ads were fairly plain ‘install ads’. Not great for brand building or telling a story.

Also, it is still somewhat difficult to get to scale without a ‘mobile cookie’ or persistent ID. That’s changing now, but without having statistical identification available at scale across many systems, only the large players like Google and Apple can effectively identify users across devices. That’s a challenge.

Who is most impacted by the growth in smartphones in the ad ecosystem?

For me, the retailers and product folks have it the worst. Soon enough, smartphones will reach 50% penetration. That means every other person will have the combined knowledge of the entire world right at their fingertips.

What that means for retailers is what Google is starting to call the ‘Zero Moment of Truth‘, an adaptation of an old P&G saying.

In other words, when a consumer is standing in front of a product with their smartphone, they can find out every single thing – good and bad – about that particular product that’s ever been written with the click of a button.

And, of course, the right price to pay. That’s an incredible dynamic. 

What’s the most shocking thing you learned while researching the report?

Around two in five (44%) of Fortune 100 companies don’t have a mobile-enabled website. That’s pretty scary, considering the ‘Zero Moment’ dynamic, but it’s also a huge opportunity. 

You asked interviewees what ‘mobile first’ really means. What did they say?

Everyone agreed that both marketers and publishers have to start with mobile, because that is where people are spending their time. You can’t ignore mobile, or just make an HTML5 site and call it a day.

If you are building a new website or launching a new product, you must do that with a mobile-first approach, and try to leverage the unique touchpoints the channel offers to consumers. That’s the obvious part.

I was pretty surprised to see how passionate people were about the idea of mobile first. Many think mobile is the biggest single opportunity out there for business. Suffice it to say, it is ignored at your peril.

What about the creative problem? How are marketers taking advantage of the unique data and form factors at play in mobile?

Native is certainly a big focus. The IAB has identified about six different categories of native advertising, many of which apply to mobile devices. OpenX has recently launched a new mobile exchange for accessing native mobile units programmatically.

Native units tend to utilise more of the mobile form factor, which is great. Marketers are still struggling to take advantage of all the great data that can be used (altitude, motion, facial recognition, biological data, activity, etc), but some really cool executions are starting to be deployed.

We are essentially ready for our Tom Cruise ‘Minority Report’ moment from 2002, with ads that can follow us around and talk to us personally based on our situation.

What are the biggest threats?

Although everyone I talked to loves their ‘triple play’ deal and Apple or Android phone, nobody wants telecoms or big technology companies to be the only ones with cross-device targeting capability.

All interviewees were interested in a more diverse ecosystem, more akin to display advertising, where the cookie (albeit controversial) has enabled real audience targeting at scale.

Marketers need to tell a sequential story as the consumer moves from device to device. That’s only possible when you can link users to all of their devices, and that’s hard to do now unless you are Verizon.

Any final thoughts?

I think video is the way we are going to see mobile eat into established marketing budgets. The ads play amazingly well on new larger-screen phones and HD tablets.

There are great creatives already established (the 10-, 55- and 30-second spot ad), and you can actually tell stories with video, which is what marketers want to do.

Videos are also the ultimate ‘native’ ad. Video is where the action is right now, but other native formats suited to mobile form factors will follow.

For further insights, download the New Mobile Display Ecosystem report.