By Correspondent Laurie Petersen

“Budgets were $10,000 to $25,000 to stick a toe in the water,” says Tom Burgess, CEO Third Screen Media, a software and services company. “Now we’re seeing multi-hundred-thousand dollar budgets. Some brands are dedicating millions.”

That statement reflects the growth the US mobile marketing industry has seen in the past year, as reflected by the fact that consumers send 10 billion text messages a month, a 200% increase over last year. The hype was apparent at last week’s annual Mobile Marketing Association Forum, where several hundred mobile marketing devotees convened in New York City.

But behind this upbeat scenario is the reality that marketers face daily planning and logistical hurdles and that mobile is truly in its infancy. Among the hurdles:



Problem #1. The Short Code Process

It can take months to register short codes with a carrier. These are special 4- and 5-digit numbers that can be used to address messages from mobile phones (GOOGL, 46645, Mozes, 66937, and “American Idol” voting, 7827). Agencies are frustrated by it. So are their clients who get sold on a big idea and then learn they can’t execute it until a lengthy bureaucratic process is cleared.

So people are trying to find workarounds. One emerging application that had people buzzing involves visual recognition technology, which allows a consumer to take a picture of a static page or billboard using a cell phone and the image automatically gets them to more information -- as if they had entered a short code.

But short codes have their purpose. Tagging the product with a short code is a common practice in Europe, and it’s expected to occur in a major way this year in the US. Nesquik tagged more than 40 million bottles for a recent promotion.



Problem # 2. Ad Buying Isn’t Easy Enough

Advertisers are looking for efficiency. “They say I want to be able to buy mobile like I buy other media,” Burgess says.

“We’re paying attention to the ad model itself,” Carrie Seifer, Director Emerging Technologies at CondeNet, answers when asked what’s top of mind. “We need to find something interesting but scalable.”

The ability to sell easily is particularly important for CondeNet, which is tapping consumer interest in its services. Epi to Go, a mobile version of its Web site epicurious.com, allows consumers to download recipes to their cell phones along with ingredient lists.

The Weather Channel Interactive just hired its first Director Mobile Advertising Sales and his boss, Louis Gump, VP/Mobile, says the rollout of mobile Web standards and what they mean for ad sales will be one of the new hire’s first tasks to evaluate.

“Brand managers are looking for the basic information they understand. Here are your options. Here is your reach,” says Jean Berberich, P&G’s mobile maven. Every P&G brand is trying something in mobile next quarter. Is it worth it? “I have brand managers who say that was a complete waste because I didn’t get the numbers I expected.”

Berberich tries to manage expectations by calling programs “test and learn pilots.”



Problem #3. Selling Mobile Content

Advertisers eager to bypass the restrictions and the tariff charged by the mobile carriers are aggressively looking to market their services directly to consumers and go “off deck,” where they will not appear on the actual cell phone menu. But doing this adds a new wrinkle: finding a way to bill the consumer for subscription services.

Anil Malhotra, Senior VP of Marketing and Alliances at payment processor Bango, had people lined up in the exhibit area to hear how his company helps marketers do it. One client, Hearst Communications built a branded mobile site for readers of Cosmopolitan, CosmoGIRL! and Seventeen offering pay-per-download and subscription services such as ring tones, wallpapers and Cosmo Hunks and horoscopes. Print ads are used to promote the mobile offerings.

One interested prospect was Charlie Minesinger, VP/Business Development for QMobile, which sells downloadable ring tones, chat and other services. His biggest frustration? The carriers’ antiquated billing systems. Dropped signals and other service problems result in a high rate of failure to complete billing for services.

“Can you imagine going into a store and having the credit card not work at least 50% of the time on the first try?” Minesinger gripes. “Visa only takes 3-5%. The carriers take a lot more, and their service is crap.”



The Good News: Two Examples of What’s Working in Mobile Now

Example #1. Dan Flanegan, President and CEO Soapbox Mobile, says some of his agency’s clients are using mobile to measure the effectiveness of their magazine advertising. By placing different codes, it’s possible to evaluate who’s reading what and at what time of day they are doing it.

Example #2. Lifetime Television ran a six-week “Watch, Bid and Win” campaign, which allowed players to bid on items tied into programming. Ratings spiked and it introduced text messaging to the channel’s older demographic audience, even prompting some viewers to buy new phones specifically so they could participate.

Education was crucial for the campaign to work. It included an explicit video step-through of the process tied into a trivia challenge involving watching the day’s shows. Lifetime also used its Web site to drive participation. Customer service staffers were on call to walk people through the process. To show for its efforts, Lifetime now has a phone list of 8,500 viewers.

“There are increases of 10-15% in the size of the number of participants each time we do something,” says Lisa Black, VP of Business and Marketing Development, New Media.


Useful links related to this article:

CSCA (Common Short Code Administration)

http://www.USshortcodes.com/

Directory of active short codes:
http://www.USshortcodeswhois.com/


Mobile Marketing Consumer Best Practices:

http://www.mmaglobal.com/bestpractices.pdf

Mobile Marketing Association Forum:

http://www.mobilemarketingforum.com/

Mobile Marketing Association:

http://www.mmaglobal.com/