How To Monetize Mobile? Stop Thinking Of It As ‘Mobile’

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by Steve Smith , Thursday, Aug. 23, 2012 For Mobile Insider

It was about time we got around to media monetization on Day 3 of the Mobile Insider Summit. The superb presentations this week from Wells Fargo, Lowe’s, NHL and Kia all begged the question — whither paid media? It was clear from what each of these brands showed us this week that they really value the ways in which mobile gives direct access to customers. But we heard much less until yesterday about mobile advertising and the role of paid media to move users and underwrite the mobile content economy.

Yesterday, publishers Hearst, Weather Channel and ESPN were here and acknowledged that the ecosystem has a problem. Hearst Digital VP Grant Whitmore said that eCPMs on mobile platforms right now are commanding about 20% of the desktop. “So that is somewhat scary for those of us running our businesses on an ad-based revenue model who are watching our most rapid audience growth occurring within this newest channel.”

Fast-growing indeed. Mobile page views grew for Hearst’s key brands 280% between June 2011 and June 2012. About 27% of the audience is now accessing by device, and on the Cosmopolitan brand, that is as high as 35%.

The answer is not banner advertising. As Whitmore,’s Eric Hadley and ESPN’s Lisa Valentino all suggested, the answer is more creative than we have generally seen on mobile. The intimacy and the engagement of these devices demands something better than a banner. Almost everyone here on the publishing side warned against making the same mistakes on mobile that we had on the Web.

Commoditization is a real risk when the inventory just won’t stop coming, Valentino, said. At ESPN, their position is to stop thinking about inventory in traditional ways. She said that last year the company found its mobile inventory sell-through was not what it should be. So they thought harder about the ways of packaging mobile with other pieces of the larger ESPN experience. On some weekends, mobile sites in the ESPN family were getting more activity than the desktop Web. And so they started selling the weekend college games as a cross-media experience. Rather than silo mobile inventory, they packaged it in the way that consumers were encountering ESPN during the live games of the weekend — across platforms and regardless of their watching the game or not. They limited the number of advertisers who could buy in. And they had 100% sell-through.

Valentino’s point is well taken. In order to monetize mobile, perhaps major media companies should be thinking of it less as “mobile.” When it comes to video advertising, for instance, Valentino said they don’t even offer advertisers mobile inventory. They simply buy video on ESPN. The video ad shows up wherever the ESPN users access it. “We need rich media experiences that can transcend all screens.”

Likewise, Whitmore urged greater cooperation between marketers and publishers on developing standards for advertising across platforms via responsive design. All of Hearst’s sites went to HTML5 in the last year in what Whitmore labeled “responsive-ish” design. We need “increased efforts to deliver ad standards within the responsive design standards.”

Thinking less about the ways in which consumers are connecting with content from multiple touchpoints brings us closer to an answer for mobile publishing.

Now from the buy side of the equation, we didn’t get around to the issue of scalability. Major media always will want direct sales and integrated programs, but they are both hard to build and require countless agency relationships with each vendor. It was an issue that came up on the previous day’s panel “Stop Advertising” in which SessionM, Kiip, UrbanAirship and skyrockit all discussed working outside the typical banner or pre-roll model. More customized, localized, conversational media are needed, especially on devices that heighten all of those qualities. But at what cost? At what complexity?

In some sense, mobile is where the Web was a decade ago when similar questions of impact versus scale and customization versus efficiency arose.

But here’s the thing. On mobile we not only have the lessons of the Web behind us, but a device that forces both publishers and marketers to confront the hard reality of post-mass media. It is personal now. Making experiences that are targeted, optimized to device, context, and need can no longer be relegated to tests.

Several years ago we spent a lot of time at conferences like this talking about the technical complexity of mobile compared even to the daunting intricacy of the Web. I was struck at this Summit by a shift in talking more about the complexity of interacting with consumers’ lives. Mobile forces the issue. Being genuinely relevant to people’s everyday patterns of work, play, buying and communication will not be easy, will not be simple and easily “scalable,” and will not be especially cheap.


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