Spoiler Alert: Mobile Advertising Works (Sometimes)

an interview with
Professor Miklos Sarvary Faculty Director, Media Program, Columbia Business School

digitalDigital Display is often considered the homely step-child of the advertising family shown up regularly by its precocious cousin Search. So it would stand to reason that Mobile Display would be equally destained.  Well as the analysts like to say, “data trumps opinion” and according to Professor Miklos Sarvary, Faculty Director, Media Program at Columbia Business School, who studied the impact of Mobile Display ads, this emerging channel does work “but only under certain conditions.”  Sarvary will be presenting his findings next week at the Columbia Business School’s Brite ’13 conference and I am delighted to provide a sneak peak of his report via the following interview:

Drew: I love the title of your presentation “The Truth about Mobile Advertising: Does it Even Work?”  Let’s start there.  Does mobile display advertising work?
Yes, our empirical analysis seems to show that it works but only under certain conditions (for certain products).

Drew:  Digital display advertising has a bad reputation already relative to say Search advertising. Why would or should advertisers expect more from mobile display?
The reason is that it is hard to observe systematic effects for display advertising, which is not the case for search advertising. Search advertising is “self-contained”, in the sense that you can have an independent campaign and if the search words are well chosen it generally works. Our research suggests that display advertising may work but only if it is part of a bigger campaign. The role of the mobile display ad is to remind people of the deeper messages of “higher bandwidth” campaigns. We show that this only works for high involvement and utilitarian products. In other words, it is harder to make the case for mobile display ads.

Drew: For marketers considering mobile display advertising, which success barometers should they focus on in order to most satisfied with this particular medium?
Actually, we found that mobile display ads seem to influence many stages of the decision funnel (we could only verify attitude and purchase intentions but I believe that they may pretty much influence the entire decision funnel). This is consistent with the idea that mobile display ads only remind consumers of another campaign transferring richer information. If this is true, then each stage of that campaign might be affected.

Drew:  Can you provide an example or two of successful mobile display campaigns?
Unfortunately not. We are not allowed to reveal the products that we have studied and I don’t have a good specific case study. Moreover, a really successful campaign might not be attributed to mobile ads alone.

Drew: Are there product/services that tend to do better than others on mobile? Are there products/services that simply don’t work at all on mobile display?
Sure. This is the essence of our findings. Specifically, and somewhat surprisingly, high involvement, utilitarian products work better for mibile display advertisemements (as opposed to low involvement hedonic products). Examples like regular cars, expensive durables, heath insurence, financial services come to mind….

Drew:  In theory, mobile display has the opportunity to be incredibly customized based on user behavior and/or location. Did this level of customization play a role in your study?
No. And you are right that this is where the real power of mobile may actually lie. We only studies simple display advertisements – little banners appearing on the screen. What is surprising however, is that a large proportion of mobile ads are still these simple display ads. And the forecasts don’t seem to indicate that the proportion of spending on these is going to decline.

Drew:  Will the advent of larger mobile phones like the rumored iPhone 6 help the mobile display cause?
Yes, I think that there will be a lot of development here. Ads will do a better job at capturing attention, reminding people of other marketing messages etc. Already now, many people count some rich media ads as display ads.

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