Cell phone carriers such as Sprint Nextel
, Vodafone and Verizon
are taking their first steps toward full-fledged
mobile advertising. And with good reason.
According to market research firm ABI Research, advertisers are poised to
spend $1.95 billion by 2011 to deliver ads to North American phones. Also
according to ABI, those ads could yield better click-through rates than
banner ads (between 2 percent and 3 percent, compared to 0.2 percent).
The temptation of green fields notwithstanding, Gartner analyst Ken Dulaney
noted that carriers should be wary of creating consumer backlash. Compared to PC-based ads, said Dulaney, mobile phone users could be faced with 10 screens.
The founder of a consumer watchdog group also warned against ad fatigue.
“People are fed up with ad creep,” said Gary Ruskin, founder of Commercial
Alert. Integrating ads within cell phone menus will cause “a great consumer
backlash — it’s right in their face,” he told internetnews.com.
The point has not been lost on the carriers, which is why they are moving
cautiously. A spokeswoman for Sprint agreed that “advertising must not be intrusive or
disrupt the customer experience.”
She said it is “still very early” in Sprint’s advertising program, begun in
October, which displays banner ads on wireless Web sites visited by Sprint
In November, U.K. wireless carrier Vodafone announced that it is joining
forces with Yahoo
to display ads to cell-phone
customers who choose to opt into the program.
Also this fall, Yahoo and Google
intentions to provide mobile ads.
And today, a Verizon spokesman confirmed that the company announced plans to
enter the mobile advertising arena in 2007.
, the world’s largest cell phone maker, likes the fact
that carriers are getting involved in mobile advertising because they are
well-placed to understand usage patterns.
Moreover, Nokia spokesman Bill Plummer told internetnews.com,
advertising shouldn’t come as a shock to cell-phone users.
Subscribers have already been able to experience full Web browsing for some
time now, added Plummer.
Sprint said certain industries, such as automobile, financial services, food
and consumer goods, have adopted this advertising format earlier than
others. However, mobile ads will not really take off until mobile
advertising is accompanied by other features such as coupons and the ability
to pay by phone.
Senior editor Michael Hickins contributed to this story