Although Wanamaker realised that much of his advertising was wasted, he never reduced his ad campaign budgets, because he understood that when his advertising hit the mark, his profits soared.
While advertisers have traditionally spent as least as much as their competition to protect market share, they are well aware that brands have a saturation point. Once that point is reached, no amount of additional spending will bring in sales to justify the cost of the campaign.
The increase in the amount of advertising has also meant that it takes more adverts for a message to penetrate the market. In 1978, 78 – 80% of adults in the US could be reached with three 60-second spots. By 2002, it would take 117 prime time commercials to reach the same base.
Futurist Dr Jim Taylor says the average American is exposed to 3800 marketing messages a day. This is accentuated by media fragmentation, which has resulted in consumers receiving information from an increasing array or sources.
At the same time, Taylor notes that the way in which people receive and send information is changing. More people now receive information through interpersonal communication that traditional channels. In other words, social media is taking over from traditional media.
British Market Research Bureau International research, conducted on behalf of the UK regulator Ofcom, found that consumers want to be entertained by advertising, but are annoyed by the poor quality.
Mobile marketing has therefore emerged at a critical time in the world of advertising. The sheer volumes of messages in the market, the fragmentation of channels and people's move towards social media have created a wave of change in the market. And the big question is which mediums will ride the wave and which will will bow out?
Perhaps the best way to examine how mobile marketing may fair in an uncertain future is to examine its strengths against current marketing trends.
Personal: we've established with diverging channels and an increase in marketing messages, consumers are facing an onslaught of information. Consumers have therefore becomes super sensitive to messages that mean something to them while discarding the rest as irrelevant. Because mobile marketing goes directly to consumers' cellphones, it captures their attention. If customer profiling has been done correctly and the content is entertaining, consumers will absorb the message fully.
Giving something back: people want to be entertained when they look at an advert. What this really means is that they expect you to make it worth their while. Time is money, as the old saying goes, and wasting consumers time irritates them and decreases your brand's value in their eyes. But what if a message could give consumers more than just entertainment? Unlike other mediums, the multimedia nature of cellphones means that the mobile content in an MMS or on a mobi website can be downloaded and used as a ringtone or background on consumers' cellphones. What's more, MMS can be used to provide consumers with discounts, digital vouchers and other incentives.
It's viral: Passing on free benefits to consumers results in the spreading of the message. Consumers who receive a discount via MMS will pass it on to friends and family members, while news of mobi websites, which provide free content, spreads like wildfire amongst the youth resulting in thousands of downloads. If those downloads do not contain DRM (digital rights management), then the viral effect is amplified even further.
It's measurable: This is without a doubt the most important aspect for advertisers. Going back to Wanamaker's quote, increased visibility into the base is of immense value to any advertiser. With MMS, advertisers can see in real time when the MMS are delivered, who opens them, which numbers fail to receive the MMS and which recipients reject the message. Mobi websites identify consumers by their cellphone numbers giving stats on how many registered and non-registered users are visiting the mobi site, which pages are most popular, the demographics of registered users, content purchases and referrals from the site to other consumers.
In outlining three important principles for advertisers, Taylor says companies need to profile consumers properly, connect directly with them and be bold in reaching out to the base. Mobile marketing does all three, positioning it as an important channel for advertisers into the future.
