Advertising in a Wireless World

In the years ahead, Wi-Fi will become a universal standard, found everywhere in the electronics world. It will show up in consumer electronics devices, from videogame consoles to music players. Cell phones will have it, as will PDAs and digital cameras. Any PC bought in a year or so will instantly become the hub of a wireless network, simply by turning it on. The numbers will quickly reach true mass-market levels: an estimated 99 million people with Wi-Fi by 2006, according to Gartner.  In respect to wireless advertising, research from Frost & Sullivan believe that wireless marketing will not take off for another decade. Despite such a forecast, it is obvious that good wireless advertising will tie into a company’s offline advertising.

Retailers have the capability to reach their audience anywhere and anytime through wireless devices. Marketers increasingly will serve up audio or text ads and promotions to wireless devices, based on the user's preferences and location, to lead traffic to nearby stores or to induce a consumer to make a phone call or link to an advertiser's wireless site. It is expected that sponsorship opportunities for wireless content and service will abound.

Moreover, those who talk up wireless marketing's potential predict that it will be two to three times more effective than Internet banner ads. They say the success of wireless advertising hinges on an opt-in approach admitting customers to dictate when, where and what the types of ads they get. Rosalie Nelson, senior consultant in e-commerce and new media for Ovum Ltd., a London-based technology consultant firm, states "With wireless advertising, it's an immediate call to action. Consumers can respond on the spot, which makes ads very effective"(James, 2000).

Cell phones, pagers, and personal digital assistants (PDAs) can be interactive mobile device for wireless advertising, and, according to a study by Ovum, Ltd., wireless devices are expected to reach more than $16 billion worldwide and to comprise 20 % of Internet advertising expenditures (James, 2000). Wireless advertising looks like direct marketing. Greenberg (2000) states that wireless devices offer a cheaper method to get connected to the Internet.  So, what does this mean for advertising?

Immediacy

 

ue to 3G's always on, real-time access, the ability to get a message in front of a consumer, immediately, is a promising opportunity for advertisers to reach their target markets. How?

Nokia Concept PhoneConsider the ability to program your GPS-enabled smartphone to notify you when in the vicinity of restaurants, coffee shops, or retailers that are of interest to you. Since your smartphone has "always-on access," and since you've essentially "opted-in" to hear from these establishments, whenever you're in the vicinity, your smartphone alerts you with a specific tone, while an e-mail coupon, with attachment, is automatically sent to your inbox.

This "permission-based" form of preference selection will help legitimate marketers escape the inevitability of less reputable marketers spamming, due to this increased access, on both the side of the consumer, as well as the advertiser.

Take travel, for example. I am traveling and in a new city. Since mobile service providers know my actual locale (they know you're area code), they'll be able to detect that I'm traveling, and therefore, the messages and advertisements I receive while surfing local hotel options, could potentially be travel-related, sending me to restaurants, flagging cab companies, and coffee shops in the same area.

Sendo SmartphoneNow, not only is my hotel preference known, but it's also known to which cities I travel, therefore creating an opportunity for travel offers, specific to the areas I frequent. And since all of this is real-time, the true opportunity is the fact that advertisers will be able to hit target audiences with messages that are not only immediately meaningful to them, but immediately actionable, as well.

A weary traveler is in search of last-minute hotel reservations, using always-on Internet access with a smartphone. After keying in the zip code, the mobile service is quick to recall that Hilton is an indicated preference for this user, and pulls up the appropriate information. In addition, Hilton is a smartphone advertiser, which provides easy, personal access to a the nearest Hilton reservations desk, via video-conferencing.


Essentially, 3G allows advertisers the ability to talk to consumers who are ready to purchase, right there, right now.

Increased Revenue Potential

nline advertising is driven, in large part, by the number of eyes potentially viewing that ad. Therefore, advertisements that are location based could assumedly be in the position to command higher CPMs, since the users are more targeted, qualified and have given their "permission" to be contacted.

Ericsson Concept Phone

 

 

 

 

 

 

 

Competitive Advantage

3G enabled smartphones will give marketers who participate the competitive edge in industries where there may be little differentiation, other than convenience, to users. Consider gas stations, for instance.

A user needs gas, and stops at an intersection with three gas stations on the corners. The prices are all the same, and the consumer has no propensity toward any one of the three. Suddenly, your smartphone alerts you, as the gas station on your right sends you an offer with a free carwash or soda, if you fill up there. Your decision has been made.


Standardization