The advertising world is both feeding, and being fed a lot of hype about the current state and potential of mobile advertising. It’s no doubt that this form of marketing is unique in many ways, and offers opportunities not available via other forms of advertising. As an example, on mobile you can take advantage of information like a relatively precise knowledge of the location of the individual. Now, it is debatable whether such granular knowledge of a person’s location is a good, bad, or neutral thing, but the fact remains that this piece of information is something that simply has not been available to advertisers until recently. Additionally, advertising on mobile is almost guaranteed to be seen by the user due to both the nature of interaction with the device and additionally due to smaller screen sizes. Lastly, the time spent interacting with mobile devices is far greater than time spent with print media, so the percentage of advertising budgets spent on mobile should be proportionally higher, right?
In fact, time spent on mobile has been ahead of print for some time, and recent data from an eMarketer Study shows that while time spend on mobile is 11.7%, mobile is only getting 1.6% of the advertising budgets out there. So if the user attention is there, and the additional advertising options are there, where are the budgets? The story that mobile companies are telling to investors and potential clients is that this is a fantastic growth opportunity because the budgets on mobile will catch up to where they should be proportionally, and this is a multi-billion dollar increase in revenues for the mobile industry. However, there is a problem with this logic. It makes critical assumptions about advertisers and agencies, where they want to spend their advertising budgets, and why. It doesn’t take into account the fact that before the spending is there, some way to demonstrate value will be required. In short, if you can’t prove the return on the money spend on mobile, the budgets simply will not materialize. The big problem of mobile advertising and lack of budgets can be traced very simply back to issues with trust and transparency. Solve those problems, and you will be greatly rewarded with all the budgets you can handle.
In order to build the necessary trust and transparency with clients, there are some areas where mobile companies need to catch up and improve. However, before any product discussion can really happen, first the industry needs to decide who their boss is (hint: it’s the advertisers and agencies, they have the budgets) and settle on consistent terminology. Without these two things, the whole industry will struggle to gain ground due to fragmentation and the futile attempt to serve too many masters.
Believe it or not, the question of how to even define what constitutes a valid impression is still somewhat of an open one in the mobile space. Do you define an impression as receiving a request for a creative from a publisher site? Do you perform a test after the request has been answered with a creative to confirm that the creative was delivered? What about a test to confirm that the user actually viewed the creative? Not having these questions answered leads to fractured and company-dependent definitions and terms like page impression, ad impression, confirmed impression, etc. So let’s take the perspective of the advertiser or agency, who is supplying the budget, and consider which definition of impression maximizes the value obtained from their ad spend.
Okay, so now there’s a solid definition of impressions, what about clicks? This is a complicated issue as well since the click usually gets registered on the publisher site, gets redirected a couple of times and may get passed through a third-party verification service, and at some point hits the landing page where the user is ultimately supposed to end up. Additionally, the click fraud topic is alive and well here and could make up a series of articles all by itself. Additionally, since mobile devices have small screens and humans have fingers with a variety of diameters, the issue of accidental clicks is something that shouldn’t be ignored.
With that in mind, a click is only valid if the creative has been viewable by the user for more than 1 second. This is a criteria that some have proposed in order to cut down on accidental clicks, and it sounds like a very reasonable requirement. Additionally, Google has gone in a good direction for AdMob ads that requires confirmation by the user that they actually want to click on the creative. This should do a good job at almost completely eliminating accidental clicks. This is a great increase for value provided to advertisers and agencies since they can be sure that the only clicks that count are ones where the user explicitly indicated their intention to view the ad.
These definitions can get us started on having a real conversation about the effectiveness of advertising on mobile. The industry needs to settle on definitions like these in order to begin to provide the reporting and insight that advertisers and agencies want from campaigns. Without strict definitions of what constitutes an impression and what constitutes a click, any subsequent analytics or reporting data don’t really provide value to anyone. At that point it’s just a lot of noise in order to try to make various players in the value chain look like they’re doing a great job. To use the words of Marc Andreessen in an AllThingsD interview, it’s important to stop measuring and using bullshit metrics. The only way forward for an industry with so much potential is to adopt metrics that make sense for those who are injecting the cash into said industry, and that is the advertisers and agencies.