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EcommerceBytes-NewsFlash, Number 2898 - September 24, 2012 - ISSN 1539-5065    5 of 6

Smartphones Demand Your Ad Budget

By David A. Utter
September 24, 2012

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Marketers underspend on mobile efforts at their peril. The tiny sliver of budgets devoted to the smartphones carried by 37 percent of the American population needs to grow, according to a summer study by cross-media research firm Marketing Evolution.

Their research suggests a sweet spot of 7% of marketing spend for the mobile audience, with a focus on growing this to 9% for products they see as having more involvement. Cars and financial products would fall into this category.

For "faster moving" products like entertainment tickets or consumer packaged goods, a 5% spend should be sufficient. Marketing Revolution considers this category low involvement.

Even more pockets in the US should be filled with smartphones by the time 2016 arrives. The study sees the 37 percent figure rising to 59%, with more marketers seeing that growth and a correlating shift in mobile media consumption, i.e., one's competitors probably aren't going to ignore this shift as they focus marketing efforts to capitalize.

Marketing Evolutions doesn't see this shift as reason for excessive spending on the mobile side of marketing. Their assessment of investing considers reaching a point where return on investment is optimal and marketers don't fall into a trap of diminishing returns. Thus, the 7% recommendation.

Retailers have been stepping cautiously into mobile marketing's waters. A Shop.org/Forrester Research report on the State of Retailing Online found 50% of retailers surveyed spent less than $100,000 on smartphone initiatives. Planning and budget limitations appear to be limiting factors for retailers moving toward the mobile world.

The essential suggestion for ecommerce today is they probably aren't spending enough to capitalize on the proliferation of smartphones and the corresponding increase in media consumption on those devices. It's up to ecommerce entrepreneurs to assess their brands and determine how to take best advantage of the increasing reliance on smartphones by what is probably a good portion of their target audience.

You may view the full report at Marketing Evolution.

About the Author
David A. Utter is a freelance writer based in Lexington, KY. Find him on LinkedIn.

About the author:

David A. Utter is a freelance writer based in Lexington, KY. He has covered technology topics from search to security to online business and has been quoted in places like ZDNet and BusinessWeek. He considers his appearance on NPR's "All Things Considered" with long-time host Robert Siegel a delightful highlight. Send your tips to media@davidautter.com and find him on Twitter @davidautter and on LinkedIn.

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