For the third and final blog, I found an article that explains the current use of mobile advertising, and its lagging success rate. The article describes how theoretically the idea of mobile ads sounds prosperous and effective, since it is a rare occasion that one is without their smartphone. However, the two forms of mobile ads are proving to be nothing more than a nuisance. These forms include the tiny banner display advertisement and the interrupting pop-up advertisement. The article shows the difference between mobile advertisement and more traditional ads by explaining, “it’s disruptive, and not in the positive way that business gurus breathlessly use the word”(businessweek.com). The negative connotation of disruptive that is attached to mobile ads describes how this form of advertisement is unwanted, compared to television ads when it is bearable to sit through, since the television program is highly desired.
This article caught my attention, because I have had encounters with these forms of ads. The increase in number of smartphones being used has led to a new medium for advertisers to get their message across. I think that the idea to utilize smartphones for promotion is innovative, yet the results have proven to be ineffective, which I believe is due to the lack of thought implemented from the advertising standpoint.
For some companies, such as Facebook, mobile ads have actually been positively received. This benefit is mainly due to the fact that smartphones are the means of access to Facebook for well over half of its users. The article states, “The company attributes its recent growth in mobile ads to what is known in the digital-ad world as “native advertising,” or advertising that’s integrated with a site’s regular content” (businessweek.com). Because the advertisements are woven within the site, it does not disturb the user as much as other advertisements. Although this may be the case for Facebook, other companies are still struggling to captivate the audience’s attention via smartphone ads. The picture below shows the revenue generated by mobile advertisements for various companies over the years.
From this graph, it is evident that companies such as Pandora, Twitter, and Facebook are generating the most revenue since access to these websites is dominantly through the use of smartphones. Contrastingly, other companies are lagging behind. Though the spending on mobile ads is projected to increase over the next few years from $6.4 billion to $23.6 billion by 2016 (businessweek.com), I do not see it having an effective outcome for companies, unless more thought is put into the strategy of displaying the mobile ads. In another article I read, it explains how the mobile advertising network companies are seeing a loss as well. “…Even in the middle of a gold rush the cost of providing a mobile ad exchange far exceeds the revenues that can be gained from it” (businessinsider.com). I find it interesting that despite the loss, the use of mobile advertising continues. Hopefully, companies will strategize in order to make their mobile ads effective enough to generate more revenue. I think that with research and further development these mobile ads may begin to be successful for the companies. However, I fear that most companies may be wasting time and money focusing on mobile advertising and may be better suited for more traditional forms of promotion.