Study Suggests a \'7 Percent Solution\' for Mobile Marketing

By STUART ELLIOTT

A consultancy that helps marketers improve the effectiveness of their advertising spending is proposing that they significantly increase the amount of money they spend in the United States on ads on smartphones, tablets and other mobile devices.

The consultancy, Marketing Evolution, is offering its advice in a study that was released on Wednesday during a Webinar. The study recommends that an average of 7 percent of total ad spending be devoted to mobile marketing â€" a stark contrast to estimates that the current average mobile budget is 1 percent or less of total ad spending.

And in the next four years, the study said, “marketers should increase their investment in mobile to approximately 10 percent.”

“It's clear that marketers are spending significantly less than they should in mobile,” the summary to the study concluded, and by not devoting enough of their media mix to mobile they are “losing out o n sales and profits.”

The study is another example of how much attention is being paid on Madison Avenue to mobile marketing as the media consumption habits and patterns of consumers change quickly. Although many marketers have swiftly been increasing their spending for mobile ads, there is a widespread belief that they are lagging behind the shifts in consumer behavior.

On the other hand, there remain questions about the willingness of American consumers to look at or watch ads on mobile devices. That has been giving marketers pause because they do not want to irk or alienate potential customers.

However, that may be changing. The study found that “when surfing the mobile Web, people expect to see ads,” said Rex Briggs, chief executive at Marketing Evolution, “like when they are surfing a home computer.”

The study advised that for certain types of products like cars, the percentage of ad spending devoted to mobile media could reach as high as 9 percent. For packaged goods and entertainment products, the study said, the percentage could be as low as 5 percent.

The study was not completely positive for mobile media moguls. Mr. Briggs pointed to a finding that more than 90 percent of studies about mobile “exaggerate the impact of mobile advertising” by their methodology.

Those studies are flawed, he said, because they survey only those consumers who click on mobile ads rather than including those who do not click on the ads.

Marketers, media companies and advertising agencies were invited by Marketing Evolution to take part in the analytic process that produced the study as well as to review the recommendations.