Hello everyone and greetings from London, England, as usual. 

In this newsletter, I want to focus on the latest trends we are seeing affecting advertising in the mobile space.

Mobile grows in significance day by day, particularly in certain areas (communications, marketing, retail, etc.) — especially post-pandemic, where it seems everyone now knows how to buy things on a mobile and is used to scanning QR codes for further information about products and services. 

The “mobile” areas I want to focus on are around:

• The phenomenal rise of some particular mobile services such as MNOs and RCS (don’t worry, I will explain what these are if you don’t know already), plus the renewed rise of our old friend SMS for business/advertiser communications.
• The coming approach to the future of apps generally where a huge revenue opportunity lies ahead.

I will cover both today in this newsletter, trying to simplify a complex environment in straightforward language and no industry jargon.

It is really important to know what’s coming so we can provide insightful conversations with our advertisers and talk knowledgeably about the future and where they should be placing their bets — hopefully via ourselves — as they see us at the forefront of the advertising industry (the consultative sell).

By understanding the environment, we can also begin to see there are new revenue opportunities for us directly with some of the players in the mobile arena. 

With advertising spend predicted to grow by 2.6% over the next 12 months, according to the Magna 2022 annual forecast report, many brands are placing advertising tech at the top of this year’s list of desires. 

Worldwide mobile penetration is at a record peak. That means many advertisers are looking more and more to mobile marketing to engage customers and stimulate sales.

Are we offering mobile services to our advertisers? I fear that many publishers did (note: past tense) do so but it slipped off the priorities. Never has it been more relevant than now, I would argue, to get it back on your radar. 

Advertisers are becoming more focused on the tech and strategies that give the best ROI. In the post-pandemic era, where much upheaval and uncertainty still remain, it is encouraging nevertheless to also see an ever-rising consumer demand for better, richer, digital experiences and services.

What are we doing about that? 

Think too about your younger audiences. They have grown up with smartphones, social media apps, messaging, etc. They are your future audience. Mobile has to be the way to go whether it’s for our own marketing … or our advertisers.

Mobile industry developments to be aware of in 2023

MNOs 

Looking at the mobile marketplace and some of the players, the Mobile Network Operators (MNOs) have a unique role in coming times in capturing first-party data. This year is their chance to make a move in gaining a leading role in the digital ad eco-system. 

As advertisers look to work with trusted and capable partners who can help them boost the success of their multi-channel advertising campaigns, MNOs are well placed to assist them. Bear with me as there is a good reason we will want to know this. 

This will be an important year for MNOs and e-commerce brands as they seek to grow their audiences and revenues, set against recessionary times in the marketplace.

Driving ad-based revenue strategies will become a true focus for any forward-thinking MNOs. By capturing first-party data only available to them, they can personalise offerings to not only sell their own services but work with advertiser brands on a huge scale to aid the cookies phaseout once we reach 2024.

Advertising brands seeking to personalise customer messaging will win as the cost-of-living crisis begins to kick in. Inflation pushes up the living costs for customers, and therefore brands need to put in measures to demonstrate their relevance and to gain loyalty and trust. 

In an environment where up to 90% of customers find messages from advertisers annoying if they are not relevant to them, the personalisation of the advertiser messages is key.

Also, a focus on privacy means advertisers will have to use less intrusive data collection to personalise campaigns and ensure accuracy of audience targeting. MNOs will increasingly be seen as key partners for brands. Watch out for increased partnerships and deals here.

RCS

Add to this RCS, standing for Rich Communication Services, which is an international-standard protocol used in the telecomms industry to improve SMS/MMS messaging on Android phones. RCS works through the native messaging apps on any smartphone. 

RCS is set to soar in the coming months in Android phones as Samsung (the most popular smartphone vendor globally) confirms it will incorporate RCS into all its new phones by default. 

Integrating rich communication services to reach and engage with customers in no doubt highly creative, really visual, and interactive methods will be manna from heaven for advertisers when it comes to delivering creative, impactful, multi-channel ad campaigns.

Creativity will become ultimately limited only by your imagination.

And don’t forget SMS

SMS marketing is also set to rise this year, securing its comeback. 

Mobile industry data shows 67% of the global population subscribes to mobile services. Due to its simplicity and reach, text messaging is seeing an amazing resurgence, which can be easily integrated into an advertiser’s mobile marketing mix. 

If one realises that SMS has a 98% open rate (vs. 20% e-mail), plus 45% response rate (vs. 6% e-mail), it is almost guaranteed to be around as a service for a long time to come and only going to grow stronger (source: tasil.com).

Interesting fact: There are more text messages sent and received daily than there are people on the planet. Think about that for a moment. Incredible!

Where does AI fit in all this? 

Artificial Intelligence (AI) will no doubt supercharge advertising and consumer engagement in the future. The recent breakthrough in AI adoption is pushing through a sea change in content creation possibilities — both for the likes of e-commerce and MNOs. 

Using AI for the creative process such as design and copywriting advertisers will mean more agility in creating and adapting content whilst opening up resource to focus on more strategic thinking and projects.

Additionally, the use of AI for personalisation of things like product recommendations will help advertisers increase conversions through a more honed and more tailored customer experience.

Summary 

Consequently, I believe all of the above above can open doors of new advertising revenue streams for media companies with the (largely, cash rich) MNOs, as they seek to push their prominence in this sector — and as we demonstrate an understanding of this complex arena with the agencies and advertisers we work with.

You should be providing access to mobile services for our advertisers and steer them to new thinking, new (younger?) audiences, and new additions to their multi-channel ad campaigns, which, from a mobile perspective, provide targeting, accountability, and clear ROI.

Apps: the future 

Mobile apps are about to generate more revenue than ever before. 

Here’s a huge statistic to contemplate: Six trillion. That’s how many hours mobile customers are set to spend with mobile apps per year by 2028 globally (source: data.ai). 

Bizarrely perhaps, considering a reduction in app use last year. In fact, spending in-apps is going to take a big jump this year and beyond, influenced by a resurgence of entertainment apps. 

Data says in 2023, a handful number of apps (for now) will be the exclusive members of the US$3 billion “app club.” (Source: data. ai). 

HBO Max, iQIYI (a Chinese online video platform), Disney+, TikTok, Netflix, and YouTube will be US$3 billion consumer spend “club members” for video streaming and short video apps. It’s interesting to note that consumers are now turning to video content on their mobiles for their entertainment. 

Mobile shopping also had a new high (on Black Friday last year), accounting for nearly half of all sales of the top-100 online retailers in the United States. 

Shopify reported mobile spend accounted for 73% of global sales for smaller vendors and the so called direct-to-consumer (DTC) brands. 

In 2022, downloads on attraction or tour booking apps grew +180% over the previous year, and ticket service apps saw a near 300% growth in hours spent. This shows undoubtedly that customers are looking increasingly at “experiences” as we move through the current year. 

Lexi Sydow, head of insights at data.ai, said: “Mobile will remain at the heart of consumers’’ lives as demand for digital connection, self-expression, and deepening personalisation of apps will fuel sustained growth.”

More evidence is it not that mobile is the answer? Embrace it if you aven’t already. You will reap the benefits as we will your advertisers.

Footnote: Gambling on gambling companies? 

Maybe this is another potential new media revenue source? 

Online casinos and sports betting Web sites — that didn’t really exist in any serious form as recently as 15 to 20 years ago — today are responsible for generating billions of dollars in revenue each year. 

The whole gambling industry has grown quickly because online gambling is very accessible and quite easy to start. Additionally, it offers a much broader range of games and differing betting options than many physical casinos and the like.

This will continue to increase. In Europe alone, for example, the online gaming industry (including here the UK as the leading market) is expected to grow by 8% year on year and reach over US$42 billion value this year.

As these gambling companies, seemingly awash with money, try to further increase their power and reach, don’t you think your sales terms should be talking to them?

Further reading

• RCS. What is it?
• The role of a mobile network operator (MNO).
• The power of SMS marketing.
• SMS marketing is still very effective.
• 10 forecasts for mobile apps in 2023.

About this newsletter 

Today’s newsletter is written by Mark Challinor, based in London and lead for the INMA Advertising Initiative. Mark will share research, case studies, and thought leadership on the topic of global news media advertising. Sign up for the newsletter here.

This newsletter is a public face of the Advertising Initiative by INMA, outlined here.

E-mail Mark at Inma.mark@gmail.com with thoughts, suggestions, and questions or follow him on Twitter (@challinor).

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