Mobile Advertising (Part 2: Differences Between Online and Mobile Advertising)

On the surface, mobile advertising looks quite similar to online advertising (channeled to desktop and laptop PCs). Both try to reach the same audience who may use different devices (from handheld devices or desktop) in different context (working, commuting, shopping, socializing or filling downtime) to accomplish specific tasks (from information search and content consumption to social interactions and commercial transactions) throughout the day. Both rely for the most part on the same set of digital technologies and infrastructures (e.g., WiFi, web browsers, digital media formats and service providers). So it is natural for advertisers and other industry players (e.g., advertising agencies and networks) to extend the knowledge and practices developed for the online advertising into mobile advertising. Just below that surface, however, there lie some technical constraints and capabilities as well as business value propositions that are unique to the mobile environment. Understanding the key differences between the online and mobile advertising environments is critical for successful adaptation of online knowledge and practices to mobile advertising. It may also provide an impetus for the development of practices and services unique to the mobile environment so as to better capitalize on the full potentials of mobile advertising.

App World on Mobile Devices

One key difference between the mobile and desktop advertising is the use of apps on mobile devices and consequently the availability in-app advertising (the placement of ads inside a mobile app in use) as an option. On the surface, the potential audience for in-app advertising can be huge. There are 224 million monthly active app users in the USA, compared to 221 million laptop and desktop PC users. During TV prime time (around 8 pm), the audience for mobile apps hits 58 million users, a figure that rivals the audience for TV networks (Gordon, 2013). Throughout the day, app users spend an average of 2 hours and 38 minutes on their smartphones or tablets, 80 percent of that time inside mobile apps and 20 percent on the mobile web (Khalaf, 2013). At a closer look, individual users typically spend most of their app time on about a dozen apps or so even if they may have installed several times as many apps. So there may not be as much room for mobile advertising as it first appears.

“For mobile devices, think apps, not ads”, declares an article in Harvard Business Review (Gupta, 2003). Accordingly, people do not like mobile ads. They tend to consider mobile as a more private venue and mobile ads as being more intrusive than desktop ads. Moreover, mobile devices have a relatively small screen that does not give room on the right margin for display ads; mobile ads therefore often pop up in unexpected places to the annoyance of mobile device users. Instead of focusing on mobile ads, the author of that article advises, marketers should create (branded) apps that add value to consumers’ life and enhance long-term engagement with their brands.

No Simple Way to Follow Mobile Users

A cookie, also known as web cookie or browser cookie, is a piece of data sent from a website and stored in the user’s web browser while the user is browsing a website. It enables the website to “remember” the user’s on-site activities (e.g., pages visited, time spent and buttons clicked). Cookie data help publishers to infer individual visitors’ interests (e.g., cruise vacations, performance cars and electric guitars) and preferences (e.g., United States edition of websites) but not browsing history or personal identity information (e.g., name and email address). When that user subsequently visits the website using the same connected device and hence the same web browser, the specific interest profiles from the stored cookie enable the site to serve relevant ads.

Cookies coming from websites whose addresses appear on the web browser’s address bar are referred to as first-party cookies. Those coming from advertisers, ad networks (intermediaries that aggregate ad space from many websites to offer advertisers greater market reach) and other technology providers, are known as a third-party cookies. By placing a cookie in the user’s web browser and updating it every time that user visits one of the websites in an ad network, that network can follow the user, build behavioral profile and serve relevant ads across many websites. This is known as behavioral targeting (more on this later). It is quite common in online advertising where users access content through web browsers.

Behavioral targeting is not as common in mobile advertising as it is in online advertising, for several reasons.

  • No cookies for apps. On mobile devices, users spend much more time on apps than on web browsers. Unfortunately for advertisers, mobile apps do not accept cookies. Ad networks cannot aggregate user behavior across apps by using third-party cookies the way they do across websites on desktop PCs. There are methods for indentifying individual app users for advertising purpose although none has yet been widely adopted. App developers can use an operating system (OS) identifier to identify individual users, e.g., Android ID on Android devices and UDID (Unique Device Identifier) on Apple iOS devices (iPad, iPhone and iPod Touch). Technically ad networks can track individual users across different apps and users have no control over that (like they could delete cookies on a desktop browser). Because of that, Apple has deprecated UDID in iOS5 and in its place recommends developers to create a unique user identifier for their individual apps. That means different apps would identify the same user differently. A solution is still needed that would balance between protecting users’ privacy and accommodating advertisers’ need to serve users across multiple apps.
  • Fewer cookies on mobile web browsers. Mobile web browsers can accept cookies. However, Apple sets the default state of its mobile Safari browser to accepting only first-party cookies (“From visited [websites]”) while blocking cookies from third parties and advertisers, thus effectively preventing ad networks from placing cookies to enable them to track users across websites. Users can change the privacy setting of their iPhones and iPads to “Never” or “Always” (accepting cookies) but very few users do or even know about this feature. Unlike Apple iOS, Android operating system does not restrict the use of third-party cookies. However, just keep in mind that Android smartphones account for less than half of Internet traffic, in term of visits, in major national markets (e.g., USA, China, Germany, France and the UK) except one (Japan). As for tablets, it is an iOS world. Android tablets account around 22 percent or less of the Internet traffic. (eMarketer May 6, 2013). Essentially, there are currently few places in the mobile world where advertisers can count on using cookies to target their mobile audience.

MobAd_MobileInternetTrafficByOS

 

  • No common identifiers between apps and browsers. On mobile devices, apps and websites are separate domains, which use separate identifiers. As a result, ad networks may see a single user as two separate individuals and therefore cannot follow an user when that user moves between an app and a web browser. Again, there are possible workaround solutions but they will have to be worked out between OS providers, advertising industry players and regulators to maintain a proper balance between business needs and consumer privacy.

Different Devices for Different Tasks

Consumers use different devices to perform different tasks. They may not see the ads appearing on these devices in the same light and are thus likely to respond to the ads differently.

  • Consumer uses of tablets are more like those of PCs (e.g., emailing, social networking and retail shopping, in that descending order) than those of smartphones (e.g., social networking, emailing and receiving news, weather and sports updates). They prefer smartphones and tables to PCs for being easiest to pick up but favor PCs as offering the preferred format. They also prefer mobile devices to PCs for entertainment.
  • Consumers feel more emotionally attached to their mobile devices, particularly their smartphones, having these with them practically around the clock. They use mobile devices as a personal assistant to better manage their life, e.g., finding quick answers to questions popping up throughout the day. They view mobile ads as personal invitations, with ads based on location as being “for me” (IBA UK, 201?).
  • Tablets are not instantly connected devices when in use like wired desktop PCs or truly “always-on” devices as smartphones. Users often download content (e.g., magazine articles) onto their tables for viewing later (e.g., in flights or on trains and buses) when there is no WiFi connection. Serving ads on the fly is impractical in such a case while preloading ads with the content makes such ads static, like print ads, rather than interactive, like digital ads should be. Using rich media ads is not an option either because their large file size would make preloading impractical.
  • On mobile devices, consumers use apps more widely than web browsers for certain tasks: “connect” (communication), “navigate” (seeking directions), “inform” (staying updated on news and knowledge), and “manage” (coordinating various aspects of life). It is the other way around for “entertain”, “search” and “shop” (Yahoo 2011).

Technical Differences

Compared to desktop and laptop PCs, mobile devices have much smaller screen, less processing power and some other technical limitations. Creative units designed for an online ad campaign are unlikely to work well on mobile devices without a great deal of adaptation.

  • Screen size. Mobile devices not only have a smaller screen than desktop or even laptop PCs but also come in a wide variety of screen resolutions, from 320×480 on older iPhone models to 2048×1536 on iPad 3 and later iPad models with retina display and many more in the between. Advertisers should therefore be ready to deliver creative units in several sizes to suit such screen-size variations. They may also want to consider designing the ads specifically for mobile devices, instead of squeezing online ads onto a smaller screen.
  • Mobile browser limitations. Mobile browsers typically do not support scripting or plug-ins. That means the range of rich-media content supported on mobile devices is limited. Apple, for example, bans Adobe Flash player plug-in on iOS devices. Flash is a very common rich-media format supporting interactions, animation and video display. It is widely used in online advertising.
  • Limited Bandwidth. Mobile web users are not typically on Wi-Fi like their online counterparts. Very few users can afford an unlimited data plan. Many phone carriers do not even offer, or have stopped offering, such a plan. Most users therefore have a data cap on their cellular devices or a speed cap after exceeding some data usage limit. They find it necessary to adjust their mobile content consumption (e.g., video watching, map-based search and web browsing) to such bandwidth limitations. It behooves advertisers to design their mobile ads with such limitations in mind.

It is not all about constraints and limitations, however. Mobile devices have certain technical capabilities that cannot be found on desktop and laptop PCs (e.g., access to a mobile device’s camera, GPS and accelerometer) thus offering advertisers opportunities to design engaging ads especially in the form of apps.