There was a time when not everyone could afford a mobile phone, and it was difficult to image that a mobile phone could have a camera. Times have changed drastically, and today, mobile phones are next only to roti, kapda and makan. We have already crossed the 250-mn mark in the mobile subscriber base, and the base is expanding with every passing day.

The mobile phones of today have great features like WAP, Bluetooth, MP3, radio, video and sound recording, etc. They are no more a showpiece, rather, they have become a necessity.

Besides people in cities and metros, people in rural areas have started purchasing mobiles for various purposes; farmers, too, have mobile phones these days. Therefore, there is immense opportunity for companies to connect to their target consumer through various modes of mobile marketing.

M for Mobile Marketing
Simply put mobile marketing means marketing a product, service, or a brand on a mobile phone.

Though packed with a lot of features, the most important feature of a mobile phone is the SMS. SMS is also a very active mode of marketing for various special offers, ringtones, brands, and products. Nowadays, mobile phones are even equipped with video messaging service, often known as multimedia messaging service or MMS. With MMS, a mobile user can send text, picture, audio, video and a combination of these.

Besides marketing through SMS and MMS, the two other significant ways of mobile marketing are through Bluetooth and mobile Web.

India, China Rule
With a population of over a billion, and a 250-mn-plus mobile subscriber base, India provides immense opportunities for companies to venture into mobile content. Many startups and individual entrepreneurs are venturing into this field, and many entrepreneurs are even venturing into offering full-time mobile marketing solutions to companies across the world.

According to the third annual Apac Mobile Attitude and Usage Study by the Mobile Marketing Association, India and China are rated as the most attractive markets in terms of mobile marketing solutions. Around 50% of the Apac mobile users were found to be moderately interested in mobile marketing solutions and only 13% indicated least interest.

Web search giants such as Google have big plans to come out with mobile operating systems with specific features that help them connect the average mobile user to many Internet advertising platforms instantly. In 2007, Yahoo! also rolled out its search facilities for the BSNL users of Mobile Web marketing, and this trend is gaining momentum.

Websites such as mGinger and Sms2India are coming up fast on the Internet. These websites specifically pay users to receive SMSes on their mobile phones after taking their permission. Unfortunately, these websites are struggling to convince advertisers about the potential they hold to make substantial revenues. However, these websites can still make strategies that would enable them to make their business models successful and convincing.

Bluetooth marketing has become a new mobile marketing trend, gaining success in India. The mobile advertisement market is still in a nascent stage, and a lot needs to be done for it to reach its true potential. Though mobile marketing helps brands connect quickly to the targeted consumer base, a major problem on its way to success is the existing National DND (do-not-call) Registry, which gives the consumer the option of not receiving promotional SMSes or calls. Most people find promotional SMSes and calls irritating, and hence a large number of mobile subscribers opt for DND. Companies, therefore, will have to get innovative to tap the potential of mobile marketing.

Picking Up Steam?
Mobile advertising is going to be the next big thing in the Indian advertising industry. Though the mobile advertising market worldwide is pegged at $1 bn, this market is finding it hard to grow in India.

IDC believes that with more than 2 bn mobile phone users in the world, mobile advertising offers the best way to advertisers to reach a large audience on an individual basis.

At present, the mobile advertising market in India stands at Rs 25-30 crore, and is set to grow to Rs 100-120 crore by 2010. Advertisers are aware of the third screen or the mobile phones. For the last six months, the industry is adding more than 8 mn subscribers. Advertisers have started to realize that this medium, if tapped properly, could be a great means for them to substantially increase their reach. Internet advertising, on the other hand, contributes around 1.8% of the country's total advertising spend.

“Understanding user behavior, capturing the right customer at the right time and understanding the social-economic status of the user hold the key to the success of this kind of marketing” Rajiv Madhok, CEO, Oorja	“Advertisers would not find a better and bigger platform than the mobile medium to reach the masses” Vijay Shekhar Sharma, CEO, One97

Personalized advertisement is a key feature of mobile advertising-depending on the monthly bill of a mobile user, advertisers would send them the right content ads. Online mobile advertising also includes broadcast SMS, brand jingles as caller tunes, music, video and games download.

The mobile music industry is picking up steam in India. In the first three months of 2008, Indian consumers purchased more music on mobiles than from any other source. Vijay Sharma, CEO, One97 Communications, a leading VAS company, says, “Advertisers would not find a better and bigger platform than the mobile medium to reach to the masses. That too with very little cost.”

Today, the mobile phone has become very cheap and is capable of data transfer; it is compatible and easy to carry. GPRS rates will also see a decline in the near future, and the purchasing power of people has increased.

The Indian economy is booming, and cell phones have become more of a necessity than a fashion statement. Easy accessible services of the Internet and services like Word, PowerPoint, and Excel on cell phones are proving to be very useful. This is attracting more advertisers into the field of mobile advertising.

Business Models
In India, companies like mGinger, mGarlic, Sms2India, SMSGupShup, YouMint, 160by2, and Way2SMS have been trying their luck for quite sometime without much success. These companies provide SMS advertising service in which you get ads of only those products that you are interested in buying. You can also earn money by referring it to your friends and family. Though this model claims that the subscribers can earn a good amount of money, the catch is that it depends on the number of SMSes a user gets per day.

“It is because operators and advertisers have yet to understand the user,” says Rajiv Madhok, CEO, Oorja, another company in the mobile advertising space. He says the whole model has to be redesigned. Madhok believes that only monetary benefit, mere Rs 0.2 per SMS, is not going to bear any fruit. “Understanding user behavior, capturing the right customer at the right time and understanding the social-economic status of the user hold the key to the success of this kind of marketing,” he adds.

Way2SMS CEO VV Raju has a slightly different opinion on this. He says, “Advertisers are ready to invest in this new medium but they need to be educated regarding the model.” He also explains: “Look at the total subscription number of newspapers. It's around 30 crore, nearly the same as the number of mobile users in India. The newspaper advertisement market is around Rs 300 crore whereas the mobile advertisement market is only around Rs 25-30 crore.” So, a lot needs to be done for creating awareness about this experimental model among advertisers. “Now we are creating awareness among advertisers about this,” he adds.

Apart from the text-based advertising model, there is another model that companies are trying: voice-based advertisement. Voice-based advertising involves playing a short and crisp advertisement, telling about products and services, before the call is placed to the number that the subscriber to this service has dialed. Also, the subscriber would have the choice of listening to the ad or discarding it. In return, the subscriber is entitled to earn some money or some other benefit.

“It's a win-win situation for telecom service providers, advertisers, and subscribers,” says R Ayyappan, CEO, Airvoice Infocomm India, the company that is using this model. “As the subscription is at the user's will, as this model is non-intrusive,” he adds. But Raju of Way2SMS is apprehensive about this model as he says it is operator dependent. “You need to rope in operators to run advertisements of that particular operator, hence catering to the masses would be a difficult proposition,” he says.

Another model being tested by advertisers is Bluetooth advertising. The Bluetooth model is more suitable for shopping malls where buyers would get various promotional ads related to the merchandisers in that mall. One major ad placements for Bluetooth advertising is at the point of sale (PoS). For example, if you are at the Barista Coffee Shop paying the bill, you might get an advertisement saying there is a discount of 50% at the Reebok showroom near Barista, which, advertisers feel, might attract the prospective buyer.

“ARPUs are going down and unless operators come up with some value added services, maintaining bottom line would be a difficult affair for the operator,” says Raju of Way2SMS. “And mobile advertising could be one of them,” he suggests. Madhok says, “The size of mobile advertising is miniscule, but it has the potential to grow at 200% a year, giving operators a new of source revenue. With the average revenue per user (ARPU) falling constantly, it could be a saving grace for operators.”

Adds Rajiv Hiranandani of Mobile2Win: “Though Bluetooth existed for quite sometime, it was only used for transferring data for individual usage. Now, companies are setting up dongles (servers) that beam the data across a shopping complex or a mall enabling commercial use of the technology.”

Though the number of Bluetooth enabled devices has increased, what's really interesting is that this is a sort of “if...only” advertising model, ie, the entire viability of this model relies on whether consumers have kept Bluetooth switched on. Given the fact that most users aren't tech savvy to even understand the usage of Bluetooth, it's a huge challenge for advertisers. At the same time, opportunities are immense, so is the possibility of spam content and virus attacks.

Long Run Issues
Much has been written about permission-based advertising on the mobile by mGinger, 160by2, etc that have used the multi-level marketing model to garner subscribers. It's supposed to be a workaround for the do-not-call, that's going to come into effect. While the word is that signups are healthy, there have hardly been any payouts to users. There are doubts around the tracking mechanism-how could one tell whether a user has actually accessed an SMS? This needs to be addressed.

A senior executive from one of the operators about their take on these services, apparently said, that the only money an operator makes is a share of the sign-up money which ranges from Re 1 to Rs 3 when a user signs up for this kind of service. The operator's logic is simple: 'If you want to use our pipe and you're making money off advertisers, we need a cut of that advertising money'.

It is too early to say whether people would accept mobile advertising as any other means of advertising because mobiles are a very personal device on which many people may not be comfortable sharing their personal space. In FY '07, 59 bn text-based SMSes were exchanged and the number is expected to increase to 180 bn by 2010. Though it can prove to be a fine source of income, in the long run, it can seem to be irritating. Mobile advertisers should come out with new innovative ideas, which will be more comfortable with audiences. Reaching to 500 mn potential customers with comparatively less expense on their advertisement budget, advertisers would not hesitate to experiment on this third screen-the mobile.

Gyana Ranjan Swain
gyanas@cybermedia.co.in