ONLINE retailers were, for all the obvious reasons, the pioneers of Web advertising. When it comes to advertising on the mobile Web, though, they are treading carefully.
On the one hand, executives and analysts said, online retailers are right to be cautious. After all, few consumers are buying items through their mobile devices. But at least some online retailers say they have found enticing success from early marketing efforts, as long as those initiatives are aimed at simply keeping themselves on the radar of customers as opposed to trying to prompt an immediate purchase or a visit to the company’s Web site.
Take Moosejaw Mountaineering, for example, an outdoor goods retailer based in Madison Heights, Mich. Earlier this year, Moosejaw began sending out text messages to more than 1,000 of its customers who had signed up to receive them. The campaign caught on quickly, with recipients often sending messages back to the retailer and receiving loyalty program points as a reward.
A recent message sent to customers, for instance, conveyed the news that someone had told Robert Wolfe, one of Moosejaw’s founders, that he looked like Ben Stiller. It then asked customers whether that was a good thing and promised points in the company’s rewards program for those who answered “correctly” (meaning yes). Sixty-six percent of the customers who received the message voted.
Mr. Wolfe said he tested a text messaging campaign two years ago with his customers (largely college students and recent graduates), but messages were too costly to send and receive, so he abandoned the idea. Now, with cellphone service carriers offering unlimited texting plans, he thinks the time is right to try again.
“With our customer base, we have to be first to market with this type of stuff,” he said.
The content of the messages was, Mr. Wolfe said, in keeping with the company’s mission to “have as much fun as possible with our customers.” The next contest will ask customers which Kelly they prefer, the one from “Beverly Hills 90210” or the one from “Saved by the Bell.”
“We try to be as dumb as you can possibly be,” he said.
Mr. Wolfe said the campaign is helping sales, although he declined to say how much. In future versions of the texting campaign, he said, the company would take a page from past marketing initiatives and include coupon codes for those who reply. The logic of that approach, he said, may be lost on more mainstream e-commerce executives.
“We sent out a mailer once that said text us back for a coupon code to get a free Moosejaw T-shirt with any order,” Mr. Wolfe said. “A real Internet business person would say it’s a mistake to do that, because the customer has to receive the e-mail, get on the phone and text us, then wait for the reply to get the code, then go back to the computer to put in their order.
“We could’ve just sent out a coupon code in an e-mail,” Mr. Wolfe continued. “But texting is cool enough that we were willing to risk some friction, knowing the upside was that people would talk about it in their dorm rooms.”
Mr. Wolfe said he would consider buying graphical advertisements for mobile Internet devices, but with the exception of iPhones, he said, screens are not sufficient to render ads effectively.
Of the roughly 230 million Americans with cellphones, about half have used them to send or receive text messages, while only about 32 million use them to browse the Web, according to Greg Sterling, an analyst with the Internet consultancy Sterling Market Intelligence.
“Thirty two million is still a significant number,” he said, “but text is where most of the volume is.”
While e-commerce companies take their time exploring mobile advertising, some of the biggest offline marketers, like Visa, American Express and Coca-Cola, have been more aggressive. That is partly because online merchants typically pursue different goals with their marketing dollars than, say, consumer goods manufacturers, who chiefly want people to remember their brands when they shop at the supermarket. Online merchants, by contrast, try to generate purchases or Web site visits with their ads.
The fact that big brand marketers are actually ahead of e-commerce companies in this respect is a big switch, said Thomas Burgess, chief executive of Third Screen Media, a mobile advertising technology company that is a subsidiary of AOL’s Advertising.com.
“It’s been the opposite of the early days of the Internet,” he said. “Only now, when we’re two and a half years into the real buying, are we seeing e-commerce companies come and say, “This can drive traffic to our sites.’ ”
Online retailers with less technologically aware customers than those of , say, Moosejaw have ignored even text messaging as a marketing tool. William Strauss, chief executive of Provide Commerce, the parent company of, among others, the online flower seller ProFlowers, said he might consider a texting campaign like that used by Moosejaw if customers opted to receive the messages.
“But I’d rather advertise in a more traditional place, where people drive by billboards or see it on the Internet,” Mr. Strauss said. “On a mobile phone, it’s on my ear, not in front of my eyes.”
Mr. Strauss said the iPhone could change that because of how well the device’s screen displays Internet pages. “All bets are off in terms of what behaviors the iPhone might create,” he said. “It’s something we’ll watch very closely.”
Whether it is from e-commerce companies or traditional marketers, consumers should expect more ads on their cellphones in the coming year, industry executives said.
Membership in the Mobile Marketing Association, an industry trade group, has nearly doubled in the past year, to about 500 companies. And businesses like Third Screen and others have helped build the business infrastructure necessary to help marketers, publishers and cellphone carriers negotiate and mount advertising campaigns.
“This is going to ramp up much faster than the Internet did,” said Mr. Sterling, of Sterling Market Intelligence. “It took 10 years and the proliferation of broadband for marketers to do things online that were predicted early on. This will take half the time or less.”
Link to The New York Times Article
Link to Marketing Charts Article
