Mobile Marketing: Exploiting the New Wave of Innovation in Marketing

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1 Mobile Marketing: Exploiting the New Wave of Innovation in Marketing ABSTRACT: Mobile technology allows customers to communicate at any time of the day and in any location. While this creates innovative opportunities for marketers, it also brings rise to certain challenges. This research will explore how this new wave of innovation can be practically utilised by marketers. Penetration rates for mobile phones are explosive. Subscriptions in Ireland (June 2011) were almost 5.4 million, with penetration rates at 117.4% (ComReg, 2011). Worldwide, it is expected that by 2014 penetration rates will reach 90% (Stamford, 2010). Advances in mobile technology are quickly changing the marketing landscape worldwide; how well these advances are being adopted is debatable. This research will aid businesses when integrating mobile marketing into their overall communications strategy. The main objectives of this research are: 1. To explore the current use of mobile marketing by Irish businesses 2. To investigate consumer attitudes towards the use of mobile marketing 3. To establish a framework for the effective integration of mobile marketing into marketing strategy by SME s The research will explore how Irish businesses can best adopt this new wave of mobile marketing by working directly with the practitioners in testing a mobile marketing framework, and develop this framework for any usage situation.

2 Mobile Marketing: Exploiting the New Wave of Innovation in Marketing INTRODUCTION: Mobile marketing (MM) can be defined as a set of practices that enable organisations to communicate and engage with their audience in an interactive and relevant manner through any mobile device or network (Mobile Marketing Association (MMA), 2008). According to recent research by Berg Insight (cited in Mobile Advertising and Marketing, 2010) the global market for MM and advertising is expected to grow from 1.7 billion euro in 2009 to 13.5 billion euro in Current trends indicate that MM has been adopted by an increasing number of businesses and is becoming an important part of the marketing mix. A recent study by ABI Research (2010) reveals that MM has experienced steady growth since its beginning and has now moved from the pioneering phase to what might be called the early growth phase. Furthermore, around 20 per cent of major companies have used the mobile medium as a marketing tool in some form or another. Dynamic Logic (2008) found that mobile advertising can play a key role in increasing brand awareness, brand favourability and purchase intent in over 30 mobile research studies across the US and UK in a range of industries. Those who were exposed to mobile advertising campaigns showed a 23.9% increase in mobile ad awareness, a 5.4% increase in brand favourability and a 4.7% increase in purchase intent (Dynamic Logic, 2008). Technology and enhanced mobile networks have greatly changed the way in which marketers can communicate with consumers via mobile handsets. Breaking down barriers of geography and time, consumers can be reached directly via this medium and as a result companies are presented with a new and innovative means of engaging consumers. The challenge for marketers, however, is how to do this effectively. The continued advancement and integration of mobile phone technologies into individuals lives has provided marketers with an ideal medium for reaching and influencing consumers (Abramovich, 2008). Mobile phones have become much more than a means of conversing with others via voice communications, they have evolved to incorporate cameras, navigation tools, applications and portable PCs. In a survey of over 4,000 web users, Burst Media (2008) highlight that 52.6% of respondents have a low tolerance for over two advertising units per web page. Respondents said they will either pay less attention to advertisements or abandon web pages altogether if they appear too cluttered with advertisements. As a result, mobile advertising can provide a significant means of effectively reaching consumers in a manner that will grasp their attention as they are presented with advertisements on a small screen that is less cluttered (Dynamic Logic, 2008). This research will contribute to the discipline area through developing key insights into how MM is being used in Ireland by organisations both large and small and Irish consumers attitudes towards the use of this medium in marketing. As the use of these devices among Irish consumers proliferates and becomes ever more integrated within their lifestyles, it is important for Irish companies to develop a framework for effectively integrating MM into their strategy. A greater understanding of the medium and how it is utilised by consumers will facilitate the creation of such strategies. Advances in technology has meant that mobile devices are no longer a means of voice communication only but have a significant impact on the lives of consumers. They can now use mobile devices as their own portable PC, to

3 , watch videos, and use social networking sites. Mobile devices have stretched communications boundaries for both consumers and marketers alike. Where advertising clutter may be alleviated on mobile devices due to smaller screens, conversely, marketers must now be more innovative in creating those campaigns that reach consumers effectively via these small screens. The more relevant direct marketing is to consumers the more likely it is to be successful. The mobile channel is a perfect medium for this purpose as it allows for personalization of messages. It is not only about getting consumer attention but also maintaining it and this can prove difficult on the small screens of mobile devices. This presents marketers with the challenge of developing a framework that allows them to integrate MM effectively into strategy. As mobile devices become ever more integrated into consumer s lives and serve as an essential element of it, this must be taken into account by marketers in developing such a framework (Haghirian et al., 2005). For this reason permission based marketing is essential to respect consumer s privacy. Essentially they are then coming to the company and its messages rather than messages being pushed onto them (White, 2008). According to Varnali and Toker (2009), when engaging in MM it is important to pay special consideration to privacy laws and regulations as it is device and technology dependant which allows identification of individual users and poses threats to privacy and security of personal information. The MMA (2011) provides mobile advertising guidelines and recommendations on best practice use of the mobile media channels mobile web, messaging, applications and mobile video and TV. Consumers can openly let a company know that they are willing to participate in MM by giving permission to receive marketing messages; in turn this drastically improves the success of such messages (Standing et al., 2005). Given the wealth of information that can be obtained from customers, gaining the consent of consumers is essential and their privacy must be respected. Consumers want to retain control of these personal devices that have come to play an essential role in their lives and it has now become a case of ceding this control to consumers and gaining permission from the consumer to communicate with them (Cleff, 2007). Permission based MM can yield benefits for both the consumer and company. The more relevant direct marketing is to consumers the more likely it is to be successful. The mobile channel is a perfect medium for this purpose as it allows for personalisation of messages. The unique proposition of MM is that it allows marketers to reach customers where they are and to target their immediate and specific needs. Organisations of all types and sizes can create successful campaigns using mobile technology without breaking the bank (Dushinski, 2009). Mobile phone applications commonly used by marketers include SMS, multimedia messaging (MMS), games, music and digital photos. However, SMS is the most widely used tool by mobile marketers (Merisavo et al., 2007). In addition, it was found that the use of MM as an information tool may lead to closer consumer relationships, which in turn makes them less receptive to advertisements from competing firms. Dickinger et al. (2004) discuss the many applications of MM, such as mobile couponing, information services, mobile CRM, branding, entertainment, product launches and location based services. METHODOLOGY: Mixed method researchers choose not to rely only on one approach for collecting and analysing data; instead they use both quantitative and qualitative data so they can provide triangulation and the best understanding of a research problem (Creswell, 2003; Robson, 2002).

4 The sequence of the researchers research is divided into three phases; in depth interviews with Irish businesses, focus groups and online surveys with Irish consumers, and finally the development of a framework which will be pilot tested in three organisations. These methods are deemed to be the most appropriate in achieving triangulation of data so that the researcher can effectively answer the following research objectives: 1. To explore the current use of mobile marketing by Irish businesses 2. To investigate consumer attitudes towards the use of mobile marketing 3. To establish a framework for the effective integration of mobile marketing into marketing strategy by Small and Medium Enterprises (SMEs) In phase one an exploratory research design will be employed. The data collection method to be utilised is in-depth interviewing which will allow the researcher to get a closer understanding of why and how companies are using MM in Ireland. Data will be collected from eight in-depth interviews with Irish organisations who have engaged in at least one MM campaign. Interviews will be conducted with two industry experts, two national organisations and four SMEs. In-depth interviews are often appropriate for interviewing executives about their managerial activity who do not have a lot of time to offer researchers (Malhotra, 2007). In order to explore consumer attitudes towards MM, phase two will collect data through the use of focus groups. This allows the researcher to explore attitudes and acceptance of MM by stimulating a richer source of information through spontaneous discussions. Data will be collected by conducting three focus groups segmented by age. Each focus group will consist of between eight and 12 participants. McDaniel and Gates (2010) purport that focus groups are much more than merely question and answer interviews - the interaction associated with the group dynamics are what sets them apart. These group dynamics are what stimulate responses from one respondent to the next, thereby yielding more relevant information. Exploring an innovative marketing trend through the use of focus groups is wholly relevant to this research because the group pressure will help to challenge respondents and keep their thinking realistic (McDaniel and Gates, 2010). It is for these reasons, and the cost and time associated, that in depth interviews with consumers are deemed inappropriate at this stage. While focus groups allow a deeper analysis of consumer s attitudes towards the use of MM, the data holds some restrictions in terms of its sampling technique. To overcome this, validate the focus group responses and gain data using a larger sampling frame, online surveys will be completed by 300 Irish consumers. Generating quantitative data also allows the researcher to clarify any areas of inconsistency within the focus group data and to elicit specific information from respondents in relation to their acceptance of MM. Surveys will be distributed to a database of respondents via ; the online tool used also permits the researcher to pre-set a quota of respondents ensuring only desired participants complete the survey. Online surveys are not only a lower cost alternative to other data collection methods, they also facilitate a better response rate for some populations (Marra and Bogue, 2006). It is also appropriate to use this data collection tool as surveys can be completed on the respondents mobile phone. CONCLUSION: In order for SME s to keep up with the dynamic lifestyles their consumers live, research into this innovative marketing tool is necessary. Gaining an insight into how MM is currently used by both large and small organisations will allow an SME to decide if this marketing medium is the right choice for their brand and what impact it might have on their consumers.

5 The framework will then act as an guide to ensure successful implementation into their communication strategy, in a time where return on investment is imperative. BIBLIOGRAPHY: ABI Research (2010). Mobile Marketing and Advertising Revenue will Approach $ 1.5 Billion in 2016, Entertainment Close-up, 16. Dec General OneFile. Web. [accessed 10. Jan. 2011]. Abramovich, G., (2008). Manufacturers hold mobile marketing s future where else in their hands [online]. Available from: <URL: [accessed 20 January 2009]. Burst Media, (2008). The Perils of Ad Clutter [online]. Available from: <URL: [accessed 30 January 2009]. Cleff, E., B., (2007). Privacy Issues in Mobile Advertising. International Review of Law, Computers & Technology, Vol. 21, No. 3, pp Comreg [online] (cited 20 September 2011) Available from <URL: Creswell, J.W. (2003), Research Design- Qualitative, Quantitative and Mixed Methods Approaches, Second Edition, Sage Publications, California. Dickinger, A., Haghirian, P., Murphy, J. & Scharl, A., (2004). An Investigation and Conceptual Model of SMS Marketing. Proceedings of the 37th Hawaii International Conference on System Sciences, Hawaii: USA. Dushinski, K. (2009) The Mobile Marketing Handbook: A step by step guide to creating dynamic Mobile Marketing campaigns, Cyber age books, New Jersey. Dynamic Logic, (2008). Dynamic Logic Announces First Performance Averages for Mobile Branding Campaigns [online]. Available from: <URL: [accessed 16 February 2009]. Haghirian, P., Madlberger, M., & Tanuskova, A., (2005). Increasing Advertising Value of Mobile Marketing An Empirical Study of Antecedents [online]. Proceedings of the 38th Hawaii International Conference on System Sciences, January 3-6th, Hawaii: USA. Available from: <URL: x> [accessed 10 January 2009]. Malhotra, N.K. (2007), Marketing Research-An applied orientation, Fifth Edition, Prentice Hall International, New Jersey. Marra R.M and Bogue, B. (2006), A Critical Assessment of Online Survey Tools, Paper presented at the 2006 Women in Engineering Programs and Advocates Network Conference, USA. McDaniel, C.Jr. and Gates, R. (2010), Marketing Research with SPSS, Eighth Edition, John Wiley & Sons Pte Ltd, Asia.

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