Saturday, July 21, 2001

Mobile Spam: European Mobile User Protection Efforts

GartnerG2, the new business growth research service of Gartner Inc., predicts that within the next 8-12 months, European mobile phone users will experience a surge in 'spamming' and indiscriminate advertising from some companies rushing to exploit the new mobile marketing channel. By studying focus groups of mobile users in Europe, GartnerG2 has found that this could deflate the market for mobile advertising before it has even begun. Consumers will harden against it, and consumer groups will begin an active campaign to protect mobile users. GartnerG2 recommends advertisers should start mobile advertising with limited objectives whilst privacy legislation and codes of conduct are being established. The mobile network operators and advertising industry groups must work together to define best practice for mobile advertising.

"This new medium of advertising sounds exciting, but companies must look at this from a customer's point of view or they risk seriously damaging their brand and customer relations," says Catherine Nichols, analyst for GartnerG2.

GartnerG2's research has developed five golden rules for companies that want to advertise directly to mobiles without alienating customers.

The Five Golden Rules for Mobile Advertising

1) Optional: The user must have the option to turn off the advertising at any time. This has to be mandatory for business mobiles as users do not want to be alerted by advertising in the middle of a meeting.

2) Personalised: Effective advertising has to be relevant. An opt-in culture is necessary to provide valuable personal information for network operators and advertisers to target specific audiences, and for consumers to influence the nature of advertising that they expect to receive.

3) Discreet: Users want advertising to be unobtrusive. Text and images are seen as acceptable, while voice advertising is not. Ideally, users would prefer their advertising to arrive silently, unless the user has opted-in, such as for location-specific advertising.

4) Moderate: Don't bombard users with too many messages. The average mobile user would find receiving 3 - 5 adverts per day tolerable. Price-sensitive users will be prepared to receive larger volumes of adverts in exchange for a tangible benefit, such as reduced charges for airtime and SMS messages.

5) Free to the Recipient: Any perception that advertising is costing the user money or resources, such as airtime, phone memory or battery charge, will greatly reduce receptivity to marketing messages. A free offer to accompany an advert, such as loyalty points, will make mobile advertising more tolerable.

Will mobile advertising catch on at all?
Mobile advertising will succeed if marketers can adapt proven advertising tactics to reach this new audience. Precedents already exist in traditional media, for instance:

- Accepting advertising as a trade-off for a cheaper service is a well-established model in commercial television.

- Viral marketing via e-mail has proved that hostility to spam can be overcome if the content is entertaining, and that adverts can be forwarded on to friends ad infinitum.

- Advertisers can also piggy-back on a free SMS message as an effective way of reaching an audience with a specific interest. For example, an advert for a betting service can be added to the end of a sports result alert.

- Traditional marketing techniques such as humour can be carefully extended to mobile phones to increase user tolerance of advertising.

"Subtlety and humour, used correctly, can make mobile advertising a valuable channel. The big danger is to kill this nascent market with an ill-thought-out, scattergun approach at the outset," says Nichols. "Customer preferences will always vary between pre-pay and subscription users, age groups, and business and personal users. However, the five rules are the common denominator that bring all these groups together."

How will technology impact mobile advertising?
Upcoming mobile network developments, such as GPRS and 3G, will increase the effectiveness and accessibility of mobile advertising by being faster and 'always on'. Improved handsets will allow the distribution of richer content, and make automated, location-specific advertising technically feasible. Mobile technology for advertising today is limited to SMS messages. Text and image adverts are beginning to appear on WAP sites, either as interstitials while a page is loading, or integrated into the pages. Such adverts have an advantage because interested users can click through to WAP sites hosted by the advertiser. However, users are already struggling with sluggish mobile browsers. Mobile advertising is best implemented as part of a multi-channel strategy that allows consumers to set their preferences via other channels, such as the PC Internet.