American (and Global) Businesses, and Marketing Companies, of all sizes, are working on mobile advertising and e-commerce platforms fast and furiously these days!  Experimentation is everywhere!  Corporations, small businesses and even non-profits are getting into the game, testing ideas, and determining what is viable and what is not for each of their specific needs.

I predict that adoption will resemble the way the Internet advertising, conversion, and payment opportunities were adopted…early adopters were first to jump on board, growth continued, slowly at first, as the early adopters became the evangelists of online opportunities like Amazon, PayPal, and Google, then a flood of adopters continued the growth, surpassing the adoption numbers for “old technology devices” such as the television set.

It’s great to use the assigned articles from this week’s study in our Mobile Advertising and Design course at Full Sail Online to see how far we have come in the last two years in terms of the Mobile Platform.   Two of the assigned articles are from 2008 and predict the growth in mobile, one is from 2010.  I have used all three to show the growth since 2008 and compare them to articles being written today.  Overall, in my opinion, the surge in mobile marketing and payments has been forced because of the economic downturn that began in late 2007 and continues today.

It is true that many consumers are being forced to make tough financial choices that include going mobile with a Smartphone and cutting back or cutting out HSIA and television services entirely.  If you can walk around with a Smartphone that can handle email, access the web and provide coupons and proof of payment receipts that do not require printing – it’s a good financial decision in very hard times like these.

Mobile Advertising and Marketing:

In the 2010 article, “Mobile Commerce Evolving From early Innovation to Mainstream Adoption”, during his presentation at the CTIA Convention, Jim Van Dyke, Founder/President of Javelin Strategy & Research stated that he believed

“mobile commerce was evolving from early innovation to mainstream adoption”

I would say that is almost an understatement given the current mobile platform activities by companies around the world – big and small.

In that article Mr. Van Dyke further stated:

“Last year consumers received 10 percent more mobile marketing messages from the telco industry compared to the previous year.”

This was significant in 2008 because the telcos were just getting their feet wet with the idea of using mobile as an advertising platform.  In 2008, advertising via Mobile was predominantly text ads.  This was caused mostly by the data transmission speeds and variations in cost related to receiving the messages.  It was mostly done by telcos because they had the required “permission” and ability to make their messages free to receive.  It was still an early experiment to gauge response.

Today, the telcos see they have lost their advantageous “bottleneck” that might have used to force businesses to contract with them as an advertising platform. As a result, their unique propoition is now in offering ways to “help” the business get more from their mobile relationship.  A recent example of this is the Coca Cola/Rogers Wireless offer:

Coca Cola uses Mobile Device as a Loyalty Card with free air-time for purchases

However, other Telcos see an opportunity in the emerging market of Mobile Payments and Near Field Communications, where AT&T and Verizon have stated intentions to take the place of debit cards and credit cards.

In the 2008 article “Going Direct with Mobile Marketing”, and the white paper attached, a great case study of a faux mobile marketing plan:

Based on known consumer buying preferences, prevailing weather conditions and the specific beverage you wish to promote, you send a personalized message to the mobile phone of each appropriately targeted customer. The campaign proves to have an exceptional conversion rate, and you know exactly which customers responded to the promotion.

As a marketer, you might think, “Nice idea—in your dreams!” It might surprise you to learn that virtually every piece of technology needed to make this fictional promotion exists today. Furthermore, the entire mobile commerce ecosystem, including consumers, advertisers, phone service carriers, merchants and data managers, is wrestling right now over the business models that will enable this level of target marketing.

Almost two years later, not much has changed in this regard – the ecosystem still struggles to glue itself together in order to achieve this utopian idea of mobile advertising and conversion.

Still, a positive gain is that businesses are discovering ways do this on their own without invoking the telcos. Early on it was the idea of creating a mobile website, built specifically for any platform.  The revolution of .mobi came and showed a rudimentary way of creating a text based mobile platform using very basic information from a company’s internet website.  When mobile transmission speeds increased, and particularly at 3G levels (nearer to DSL speeds), businesses could choose to add a mobile website that offered more display features and web enabled services.

Another force creating positive outcome in the mobile market has to do with the popularity and soaring growth of Social Media.  As they have learned (and continue to learn) over the last two years, in order to socially market and convert a customer, you must develop a relationship.  This sparked the idea that sellers could engage and develop a relationship – not just online using computers – but also via a mobile platform where they encouraged interested prospective customers to provide them with their mobile device information as yet another way to communicate.

Fundraising:  American Red Cross is Keynote at Non-Profits Mobile Day

Due to the popularity of Facebook and other social networks (You Tube) that are designed for mobile use, consumers are becoming more comfortable having Brands they trust, and want to do business with, contact them on their mobile device.  It allows the Brand to do a work-around of the telco simply by asking the right questions that allow them to deliver their messages in the proper format to consumers who opt-in for them.  Thus, they are building their own mobile marketing lists, rather than using the telco services at an additional cost.

Mobile Coupons/Targeting:  Apparel Retailer “Journeys” awards coupons using a Locations Based Game called “SCVNGR”

Text Messages:  For every text you agree to receive from SendSavings, a charity of your choice gets a nickel!

Facebook:   DIY:  How-to” for Mobile Advertising on Facebook

“We Do It for You” vendor for Mobile Advertising on Facebook

AdMob announces their Mobile Ad platform for Facebook in 2007: (is there any surprise they were recently purchased by Google in 2010)

Video:   You Tube Launches New Mobile Ads

Google:  Launches Banner Ads on You Tube

Mobile Finance:

Mr. VanDyke went on to say,

“There are a number of technology changes that make up a revolution, and mobile money will be a revolution, but it will be death by a thousand cuts,” said Jim Van Dyke, founder/president of Javelin Strategy & Research.

That is exactly what it became, and what it remains today.  Mobile Money was nothing new in 2008, back then the “bleeding edge” players were businesses like PayPal who provided opportunities to send money P2P (Person to Person) using their mobile phone to text a dollar amount (20) to a short code (72762).  Next, they ramped that up with donations to non-profits.

Not too long after, PayPal introduced direct payments to select Merchants using short codes which, when received by a mobile carrier, would transmit embedded dollar amounts and product codes for what the customer was purchasing, and return a receipt for that purchase to the customer. This idea is described in the article “Going Direct with Mobile Marketing”, and the white paper attached.

At this point, the banking industry was still in slow motion, and in no hurry to adopt.  Most banks were just getting around to properly securing their online account platforms and offering online Bill Pay on the web, and felt mobile platforms were too insecure to use for banking except for “web enabled” devices that could be controlled and secured from their Internet banking portals.  In addition, the U.S. Economic meltdown was in full swing, and they had much more pressing matters at hand.

Today, in July 2010, the big banks are starting to jump into mobile banking in a frenzy (one has to assume the bailout helped them refocus on creating new ways to develop profits).

The latest and greatest are mobile deposits:  simply take a photo of the check you wish to deposit, and use the mobile interface to enter the “deposit ticket” info for your account.  Done!  You never had to drive to the bank.

Money is moving faster at the speed of mobile now, and it’s again PayPal, followed by big banks leading the way.

Mobile Finances by USAA – Banking, Insurance and More

Mobile Check Deposits Using your Cell Phone Camera

Tap and Pay:  First Federal Savings Bank enables Contactless Mobile Payments

Mobile Payment Start-Up:  Boku get VC funding

Potential Negatives:

Of course, with the good, always comes some ‘bad’.  Some negative changes I see in the (not so distant) future include:

Taxation: Proposed bill could make mobile commerce subject to state sales tax:   http://www.mobilecommercedaily.com/main-street-fairness-act-would-make-mobile-commerce-subject-to-state-sales-tax/

Security Issues:

NFC Article on Security in re: Tap and Pay mobile payments

To Quote NFC verbatim:

“Because the transmission range is so short, NFC-enabled transactions are inherently secure. Also, physical proximity of the device to the reader gives users the reassurance of being in control of the process.”

Despite their comparisons to Wi-Fi and Bluetooth, I remember those same “assurances” for both.  My personal opinion is that, anywhere a technological “conversation” exists in-the-air, there is potential for someone to figure out how to hack it.  RFID tag are the current example.  I hope, and am pretty sure, that someone is already working on securing this newest technology.

Citi iPhone App Security Flaw – What does it mean for Mobile Banking?

Dangers of delay in Entering Mobile Market:

An article dated July 26, 2010 shows the danger posed by Marketers who are not yet ready to dive into Mobile citing that Amazon’s 1 Billion in Mobile Commerce may end up making Amazon synonymous with Mobile Commerce, shutting out many others who are not paying attention.

In Conclusion:

Two very important summaries were made in two of these articles written in 2008, which I think need to be restated as they continue to be true today in 2010:

In the 2008 article “Going Direct with Mobile Marketing”, and the white paper attached:

“…most important to the topic of mobile marketing, mobile devices are not passive devices like credit and debit cards. Mobile devices provide two-way communications. Not only do they transmit account information at the point of sale during a transaction, but these devices can also receive information. This information can be personal account information and it can also be personalized advertising”

In Jack Myers’ just-updated Media Business Report:

“it’s about two key differentiators in mobile: ubiquity and richness.

Take text messaging. It’s hot in mobile. Text messaging has reach and ubiquity but limited richness as a medium. In fact, there is not much you can do with 160 characters.

On the other hand, banner ads on WAP sites are a little richer in content and interactivity but are not ubiquitous because few people have data plans that can access WAP pages. It is somewhere between 10% and 15% of all cell phone users”

“Voice is ubiquitous (100 % of the 5 billion phones in the world allow it — 3.5 billion cell phones plus 1.5 billion landlines), and it’s rich because of the very intimacy with which it communicates to the listener.

You really can’t ignore someone speaking into your ear. This is a great combination for advertisers who want to tell a rich, compelling story to a massive audience.

Mobile marketers have been obsessed with text messaging and banner ads on WAP sites, but living with the downsides of each. With voice advertising, they don’t have to. Ubiquity and rich media aren’t mutually exclusive. They’re what is driving the move of millions of marketing dollars into the mobile space.”