Mobile devices target a more specific audience than that of the traditional web.  These days the majority of executives use smartphones and companies are still spending on mobility and productivity tools for small to medium-sized businesses.

According to a Nielsen report in 2009 more than half of the smartphones on the market today are used for business.  Apple recently announced selling 50 Million iPhones/iPods and Google has announced they are making 100,000 activations per month of new devices.  With only those two statistics combined you have a HUGE emerging market of business users to target.

While executives are using their phones for business, they are also using them for pleasure, installing games and applications.  Ignoring this advertising channel is eliminating an emerging revenue stream.

How do you advertise on mobile devices?

There are many different forms of advertising available on mobile devices:

Mobile Organic Search/PPC – Traditional SEO (Search Engine Optimization) or PPC (Pay-Per-Click) with custom landing pages developed to be smartphone friendly.  Users on mobile devices need landing pages that support their web browser and don’t have a lot of complex form fields to enter.

Social Media– Advertising on large social media sites, like Facebook, with a fully  developed ad platforms has not quite matured in this market yet.  Methods to access Facebook on mobile devices rely on custom applications that do not show ads on mobile devices, yet.  Also the demographics for the majority of Facebook users does not necessarily include your target audience, the business professional.  That said, Facebook does have tools that allows you to target personal information which may allow you to find exactly who you are looking to target.

YouTube – All smartphones have a YouTube player which overlays a banner style text ad over the video as it plays.  These ads are purchased by advertisers using the traditional YouTube advertising format.  Ads can be targeted towards videos and keywords relative to your services.

Ad Supported Freemium – Application developers who want to get their apps in as many hands as possible will typically have an ad supported version along with a premium paid application.  These freemium applications typically hook into the ad network, provided by the platform to display a small contextual banner style ad with clicks, taking the user to a mobile landing page.  Some freemium application functions that your potential customers might be using today are: Expense Management, Budget Management, Flight Tracker and Task Management.

In-App Advertising – This is a new form of advertising which typically starts with a simple banner like ad, instead of a click taking the user to a mobile webpage, more options are available.  A mobile smartphone knows more about a user than a typical web page.  Information like their current location, address book, calendar and call history can be accessed by custom applications to provide new advertising opportunities like never before.

Some ideas presented by Apple and Google include:

• Using location information to include Click to call banner ads.
• Application takeover where a small banner expands to display the ad.
• Full application functionality with game like user interaction.
• Map integration using location information to show local data/services or direction.
• Delivery of ads relative to the app content.

Mobile Application Ad Platforms:

Today, the three major phone vendors are each hedging their bets on their own ad platforms:

1. Google’s AdMob (AdSense for Mobile) – Just last week the FTC approved Google’s acquisition of AdMob the largest mobile advertising network which provides an open ad framework currently available for iPhone and Android Applications.  This framework currently only supports small banner style ads, but Google has announced major changes at the recent Google i/o conference indicating support for a wide variety of In-App Advertising options.

2. Apple’s iAd – Announced at the latest Apple keynote during which Steve Jobs, co-founder and CEO, stated he thinks search on phones is a dead end and that In-App Advertising is where ad requests will be generated on mobile devices.  Apple’s iAd supports small banner style ads along with full blown native iPhone only applications for in-app advertising.  The majority of applications on iPhones use AdMob today.

3. Blackberry Ad Network – Blackberry application advertising is segmented, as AdMob does not service this market. Blackberry recently announced it will create its own ad network, with SDK available in the second half of 2010.  No further details are available, but it’s assumed that this network will support in-app advertising.

Who should you target?

Your first strategy should be to extend your advertising to the traditional web outlets.  A traditional SEO and PPC ad strategy with custom and tested landing/squeeze pages for mobile devices are essential.  Also advertising on other web networks that receive significant traffic, like Facebook and YouTube, will also end up on mobile devices eventually.

In-app advertising is still in its infancy, which means there area to explore not yet saturated with advertisers.  When Google AdWords was first launched, the Costs-Per-Click (CPC) was much lower due to a lower demand for paid clicks.  As demand for in-app mobile advertising rises, so will the CPC of the ads.  Based on the smaller number of advertisers doing in-app advertising, you should be able to get a cheaper cost-per-acquisition ratio on mobile devices than on traditional ad networks.

With three different networks, each providing a different method of getting your ads onto mobile devices, it may be best to start with one.  Looking at the statistics of your website, this should give you some accurate numbers of the devices people are using that are interested in your business.  Here is a screenshot of Google Analytics showing a breakdown of visitors to a site based on mobile device:

A typical trend is that while visits by mobile devices are small in comparison to desktop devices, it’s a growing statistic typically lead by iPhone/iPod devices and followed closely by Android.

Apple constantly exceeds expectations with its products and technologies and iAd should be no different.  With a brand new ad network, early adopters will get first view by millions of iPhone/iPad/iPod users.

Blackberry’s roots are in corporate and business smartphone development with arguably the largest install base in corporate America.  Look for more information about their ad network, along with iAd early adopters, this ad network will get first crack at millions of dedicated blackberry users.

The network with the most potential is Google’s AdSense network.  Google already has established partnerships with large marketing firms and delivers tools like AdWords and Doubleclick to monitor and track your campaigns.  Google’s open nature and over 10 years of experience in the ad space should earmark them to be the largest ad network. This may eventually lead to inclusion blackberry devices with the continued success on iPhone and Android Devices.

Not ready to believe the demand for mobile advertising?

Here are recent statistics taken from the AdMob Mobile Metrics Report – (http://metrics.admob.com/wp-content/uploads/2010/05/AdMob-Mobile-Metrics-Apr-10.pdf)

*Note: These statistics are skewed in favor of iPhone and Android devices, as these are the only platforms AdMob currently serves.  The Blackberry install base is much larger than the number of ad requests, since the advertising market is segmented they are not accounted for.

Over 7.4 Million ad requests in the US in April 2010.

Android, iPhone and Blackberry are the clear leaders in ad requests.

Top Phone model ad requests in the United States is clearly the Apple iPhone.

Ad request traffic relative for Apr 2010 relative to Apr 2009.

Are you planning to do mobile advertising?

These advertising networks will establish themselves in the last two quarters of 2010.  Is your business planning to take advantage of these new advertising outlets?  Do you see value in focusing a percentage of your ad spend on mobile devices?  Do you have web statistics that support advertising on mobile devices?  I’d love to hear your individual success or failure story and offer help with your mobile advertising strategy.

Further Reading

If you are interested in checking these facts yourself, here are some articles and videos used to produce this blog post.

Google IO 2010 – http://code.google.com/events/io/2010/

Apple iPhone 4 OS Event – http://www.apple.com/quicktime/qtv/specialevent0410/

Nielsen mobile device statistics – http://bitbriefs.amplify.com/2009/09/20/smartphone-and-iphone-demographics-from-nielsen/