- Email: [email protected]
Permission-based mobile advertising
PERMISSION-BASED MOBILE ADVERTISING Patrick Barwise Colin Strong f
ABSTRACT This article reports the results of a study of permission-based advertising via mobile phones. The study, part of the proof of concept for a UK startup, specifically explored the effectiveness of SMS text messaging as an advertising medium for reaching young adults. The results suggest that, with the right execution, the mobile channel has the potential to benefit both advertisers and consumers. The findings also include some suggestions about when and how to use this emerging new medium. Although confined to SMS text messaging in the UK, the results are also likely to be relevant to other countries, and to more advanced mobile communication technologies as these are rolled out.
© 2002 John Wiley & Sons, Inc. and Direct Marketing Educational Foundation, Inc. f JOURNAL OF INTERACTIVE MARKETING VOLUME 16 / NUMBER 1 / WINTER 2002
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PATRICK BARWISE is professor of management and marketing and chairman of the Future Media Research Programme at London Business School. He is also an advisory board member of The Mobile Channel. COLIN STRONG is a Director at NOP World, and undertakes a wide range of research in mobile markets.
PERMISSION-BASED MOBILE ADVERTISING
BACKGROUND: THE GROWTH OF MOBILE TELEPHONY AND SMS
phone. Twenty-four percent said they would be likely to agree to this, rising to over half of 14 –17 year olds. These acceptance levels offer a promising back-drop to companies such as The Mobile Channel (TMC), who offer a permission-based mobile advertising (PBMA) service. TMC’s service involves recruiting consumers in its specific target market: cellphone owners aged 16 –30 living or working in UK cities. They are asked to complete a short interview detailing their lifestyle and interests, to create an individual profile. The profiling information is then used to target the cellphone owner with up to three relevant text adverts per day. The cellphone owner receives a small reward for each text advert that is sent (5 pence, equivalent to 7 cents). TMC’s proposition is positioned as follows:
In recent years the UK has seen dramatic growth in the adoption and usage of cellphones, with overall penetration at almost 70% (August 2001). Underlying this, we are seeing the market at saturation point in some segments with almost 80% of 18 –24-year-olds now using a cellphone. While voice is still the key application, short message service (SMS) text messaging has also proved to be a big success (Harvey, 2001). Sixtyeight percent of mobile phone owners say they “currently use” this service. This varies greatly by age group (Figure 1). The volume of text messages sent is also impressive. Eighty-one percent of 18 –24-year-old cellphone users send at least one text message a day, and 31% send at least five a day. Text messages are used for a wide range of purposes (Figure 2). New applications such as “group texting” (messages are exchanged between multiple cellphone users for “chatting” purposes) and EMS (multimedia clips sent between users) mean that we are likely to see increased growth and sophistication of the mobile texting market.
Permission Based. There is an increasing trend towards unauthorized “spamming” of cellphone owners with text adverts, where the recipient has not given permission for any text advertising to be sent. TMC’s service is strictly and explicitly permission based (Godin, 1999). Quality of Profile. TMC holds a direct (not derived) profile of over 20 geodemographic and psychographic attributes. This profiling ensures that both mobile owners and brands gain the best possible experience from the medium through targeting segments with relevant advertising.
The Concept: Permission-Based Mobile Advertising In a recent NOP study, UK cellphone owners were asked whether they would be willing to receive text-based advertising on their cell-
FIGURE 1
Text messaging usage by age group.
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FIGURE 2
Types of text message sent.
(7 cents) for each text message received. It was explained that TMC would send them up to three text messages a day. On this basis they would accumulate incentives each week to the value of around one pound ($1.40). The choice of incentives offered were a £5 ($7) airtime voucher (if they had a prepaid cell phone), a voucher that was redeemable in a leading retail store, or a donation to one of two specified charities. Profiling information was collected during the recruitment interview to allow some targeting of the text adverts based on age, gender, and lifestyle. Specific information collected included: (a) leisure interests, (b) number of holidays or breaks taken in the last 12 months, (c) types of music interested in, (d) daily newspaper(s) read most frequently, (e) radio stations listened to on a regular basis, (f) access to and usage of the Internet, (g) occupation, (h) marital status, (i) car ownership, and (j) income. The sample included an equal number of males and females. Five hundred structured telephone interviews were undertaken to explore both the effectiveness of text-based advertising and reactions to the experience. The interviewing was staged over the course of the trial, to give early feedback and allow an understanding of changes in reactions over the trial. Six focus groups were also undertaken at the end of the trial with respondents from different customer segments.
TMC commissioned NOP World to undertake research to test this concept.
Research Questions The study was designed to address five questions: 1. How favorably/unfavorably will consumers respond to the experience of receiving permission-based mobile advertising (PBMA)? 2. How effective is PBMA for advertisers? 3. How much does consumers’ positive response to PBMA (and therefore advertising effectiveness) decrease after the initial novelty wears out? 4. What are the types of advertising task and context for which PBMA is especially wellsuited? 5. What types of creative execution work best?
METHOD One thousand mobile phone owners in Greater London, aged 16 –30, were recruited in February 2001 to take part in a trial of the TMC service. The recruitment was undertaken by telephone using randomized phone numbers. The contact was wholly in the name of The Mobile Channel. Those who agreed to participate were given a signing up incentive worth five pounds (about $7 US) and told that they would receive 5 pence JOURNAL OF INTERACTIVE MARKETING
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4. Product, service or information request: examples included Interflora: “Have you remembered Mother’s Day this Sunday? It’s not too late to say it with flowers, just call Interflora on 0870 904 7474.” And Cadbury’s “Cadbury Gifts Direct—THE guide to gifts for chocolate lovers. For your copy sent direct to your door just text back CADBURY now!” 5. Competitions: examples were Wella, “Free Wella Shockwaves. 1st 50 win! Text back WELLA now” and Lucozade Sport, “Win a signed Premier League shirt from Lucozade Sport. Text back your team’s name 2 enter draw. Lucozade Sport. Have you got it in you?” 6. Polls/Voting: included lottery company Camelot’s advert “Would you like to play the National Lottery using your mobile? For further details text back YES. U 16s cannot play” and Blockbusters, “THE BLOCKBUSTER OSCARS VOTE Marilyn Monroe or Cameron Diaz. Txt us your fave female movie star, past or present. Let U know poll winners on Mar 18th!”
The trial lasted 6 weeks, from February 22nd to March 31st 2001. Thirty-five brands participated, chosen to represent a range of sectors and on the basis of their appeal to the young adult market. The number of adverts sent out for each brand varied but the average was 3.6 per brand. Some of the advertisements were purely brand-building, aiming to raise the brand’s visibility and salience. Most, however, fell into the broad category of direct response, defined as follows: “Direct response advertising is [advertising] intended to either stimulate a direct order, generate a qualified lead that can result in a sale, or drive store traffic that results in sales of advertised products” (DMA 2000). Many of the direct response ads and some of the brand-building ones exploited the mobile channel’s ability to be used for time-sensitive communication, in some cases even picking up on breaking news. Many also exploited one or both of the mobile phone’s own direct response mechanisms—voice and text back. There were six types of advert altogether: 1. Brand building: examples include an esoteric campaign for Tango (a soda) with executions such as “Feed the Tango inside” and “The Tango inside is wise. Feed him.” Another, for Carlsberg, was sent to males 18⫹ at 10.30 p.m. on a Friday night: “Pulled? If Carlsberg ran a nightclub you’d have pulled by now. Probably . . .” 2. Special offers: these were to create awareness of existing special offers. A typical example was from Sega: “A Dreamcast with 4 selected games for just 109.99 pounds at Electronics Boutique or Game. Details in store. Call 08456 090 090 for your nearest store.” 3. Timely Media Teasers: these were used by media organizations to encourage purchase or viewing, for example, the following execution by The Evening Standard (London’s main local newspaper): “Tube strike starts 8pm . . . Anger as Major says ‘walk’ . . . see tonight’s Evening Standard for ‘walking times’ map of key routes in London.” JOURNAL OF INTERACTIVE MARKETING
RESULTS We present the results as answers to the five research questions.
1. Consumer Response The offering received a favorable reaction from triallists with 51% very satisfied and 42% fairly satisfied (Figure 3). Eighty-four percent said they were likely to recommend the service to a friend (Figure 4). Only 7% said they anticipated leaving the service within the next three months if it were to continue. The qualitative research too found an enthusiastic response. Consumers saw PBMA as a good way to communicate with them and an inevitable development. A number of issues are key to consumer acceptance of the service, however: Relevance of Advertising. The very personal nature of the mobile phone compared with ●
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ers. The qualitative research indicated that for older consumers it was a “hygiene factor” that increased their tolerance for adverts that were less relevant and engendered a perception that the service was not simply “junk mail.” For younger respondents, who were less affluent, the reward was more of an incentive in itself. Explicit Permission. Obtaining consumers’ explicit permission to receive text adverts means they generate a much better response than would otherwise be the case. Triallists were told that they would be receiving “up to three text messages per day . . . from a wide range of quality brands that are interested in texting you.” This is easily understood explicit permission that is far removed from a vague “opt-out” option that is often used as justification for irrelevant direct marketing messages. Consumer acceptance of PBMA is critical for the brand. Without it, text adverts are at best ineffective, and at worst, could reduce brand equity by causing resentment, because the mobile phone is seen as very much part of consumers’ personal space.
FIGURE 3
Level of satisfaction.
other media means that consumers expect the advertising to be highly relevant to them as individuals. Seventy-one percent of TMC trial lists agreed that the adverts were relevant to them. The qualitative research indicated that there is some tolerance to adverts that are less relevant provided that most are. TMC’s view is that high relevance can only be achieved from data obtained explicitly from the consumer at the time of obtaining permission, rather than by mining an existing customer database.
2. Advertising Effectiveness The results of the trial are encouraging. It generated high levels of readership, advertising awareness, stronger brand attitudes, direct behavioral responses and some unintended positive effects. (a) Eighty-one percent of triallists did not delete any of the text messages before reading them. Of the 19% that did delete prior to reading, most deleted fewer than a quarter of
Frequency of Advertising. Eighty-two percent of respondents felt that receiving three text messages a day was “about right.” While the qualitative research indicated that some (mostly younger) segments would be receptive to receiving more frequent adverts, there is a danger that too many will become an irritant and trigger a “delete on receipt” reaction. Other issues to consider are that increasing the frequency of adverts could use up message memory (the average cell phone currently holds only about 10 text messages), and that increasing the volume could mean that fewer messages are read thoroughly. Standard of Copy. The copy of the text adverts is crucial. The issue of what makes good copy is explored in a later section but essentially consumers like text adverts to be concise and either entertaining or informative. Reward. The reward system underpinned acceptance of the text adverts for many consumJOURNAL OF INTERACTIVE MARKETING
FIGURE 4
Likelihood of recommending.
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FIGURE 5
Percentage of adverts deleted prior to reading.
FIGURE 7
Speed of readership.
the messages (Figure 5). (b) Most messages were read in full, with 74% of triallists fully reading more than three-quarters of the message (Figure 6). (c) Seventy-seven percent of triallists read the text adverts as soon as they received them. This has important implications for being able to provide time-sensitive information and direct response options that require a very quick text-back response (Figure 7).
advert during the course of the trial, they were not asked to recall anything about the content of the text adverts themselves. Interestingly, there was no relationship between brand recall and the number of text adverts sent out for the brand. This again illustrates the importance of the advertising copy. Brand Attitudes. Two brands were selected to test whether attitudes towards the brand could be influenced by text advertising. In both cases, questions relating to brand orientation were asked of all triallists during recruitment. Half the sample was then sent text adverts about one brand, a leading candy bar, and half was sent adverts relating to the other brand, a TV channel. The follow-up questionnaire repeated the same question set for each brand, both for those who had and for those who had not received the text adverts. This gave an experimental and control condition to help us separate the influence of the text advertising from other advertising being undertaken at this time that may have influenced change in response. The results for each brand are outlined below. Brand salience: Candy bar: The question asked to establish brand orientation was “When you take a break at work or study, what three things might you buy?” Upon recruitment, 3% mentioned the candy bar brand. Upon follow-up, 7% of the control condition (who had not received text advertising relating to the brand) mentioned the brand, while 9% of the experi-
Raising Awareness. Over the course of the trial, each triallist was sent adverts relating to, on average, 21 different brands out of the total of 35. The triallists were asked which of these they could recall using a prompted list. Sixtynine percent were able to recall 11 or more of the 21 brands, including 14% who recalled 16 or more. Respondents simply had to recall the brand name itself for which they had seen a text
FIGURE 6
Percentage of adverts read in full.
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FIGURE 8
Attitudes to C5 pre- and post-trial.
category including texting-back to receive a mail catalog and ordering flowers by telephone for “Mother’s Day.” Nineteen percent of trial lists responded to this type of text advert, on average. Competition entries: There were a number of competitions offered via text adverts. The average response rate was 13%. The most successful ones allowed the triallist to respond by text-back with little or no keying in of additional information. Those that were less successful involved the triallist either going to a website or keying in a lot of information to enter the competition. One striking aspect of the competitions was the speed of response. One example was an offer by a leading cosmetics firm offering a free sample pack to the first 50 people who texted back. This generated a response rate of 20%. Among those who responded, 41% did so within the first minute. Polls: These asked triallists to vote by texting back. Overall, 14% of those receiving a text advert responded.
mental group (who had received advertising relating to the brand) mentioned the brand. Hence, there is an encouraging difference in the experimental group between the pre- and post-conditions. The reason for the increase between pre- and post-conditions for the control group is likely to be the volume of advertising undertaken by this brand using other media during the same period. Although the experimental group has higher recall than the experimental group, the lack of a statistically significant difference between these groups means we need to be cautious in drawing conclusions. Brand attitudes: TV channel: A number of questions were asked to establish attitudes towards Channel 5 (C5) a UK terrestrial TV channel. There were a number of positive differences in attitudes towards the brand pre- and post-trial (Figure 8). Again, the results are not statistically significant, but they provide an indication that text-based advertising can have a positive influence on attitudes towards a brand. Direct Response. Sixty-three percent of the trial lists claimed to have either replied or taken action as a result of receiving a text advert. Their responses fell into a number of different categories. Product, service, or information request: As mentioned earlier, several text adverts fell into this JOURNAL OF INTERACTIVE MARKETING
Other Unintended Responses. Two other unintended responses were also observed. Retention and forwarding of text message: Seventeen percent of triallists retained and forwarded one or more text adverts to a third party, an indication that text advertising can develop into ●
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FIGURE 9
Response to direct response adverts.
phone interviews undertaken at different stages of the trial. The positive feedback received from the initial stage of interviewing indicated that there was no need to amend the program due to adverse reactions by triallists. Furthermore, the findings from independent samples taken at different stages of the trial show no signs of declining enthusiasm or consumer acceptance. Second, the direct response options showed no sign of reduced takeup over the course of the trial. Some of the highest levels of response occurred towards the end of the trial (Figure 9). There was some drop-out over the trial but this was only about 2%, and mostly in the first week after the initial signup, which is normal. There was no indication of triallists dropping out in any sizeable numbers due to a dislike of the service.
viral marketing. Text adverts that were forwarded were those that were seen as especially entertaining or informative. Unsolicited responses: A significant number of responses were generated to text adverts that had not specifically requested a response. These were often humorous, and illustrate the interactive nature of the medium and its potential for generating interaction with key market segments. For example, Carlsberg lager ran a campaign with six awareness executions involving humor and timely use of the medium, for example, “PINT! It’s your round. Probably . . . Carlsberg.” This went out at 10.30 p.m. on a Friday. A range of responses came back including “It was and I got 6 in.” Overall, the response levels generated in this PBMA trial are encouraging. They compare favorably with traditional media such as direct mail, in terms of costs, speed, and response rate. However, as with any limited trial, a concern is that the high response levels may merely reflect a novelty or honeymoon effect. The sustainability of the response can be tested only with a longer experiment. But our experimental design does allow us to test for wearout within the 6-week trial.
4. Suitability for Different Advertising Tasks and Contexts The TMC trial suggests that PBMA can be suitable for a variety of advertising tasks, with some success observed in increasing brand awareness, influencing brand attitudes and generating encouraging levels of direct response. The qualitative research found that triallists considered the mobile medium best suited for advertising low-ticket items that are everyday, frequent purchases rather than large, highvalue items. This is perhaps not surprising, given that consumers will seek more information about high value items than is possible in a text message (Barwise, 2001).
3. Consumer Wear Out Two results suggest that consumer response to permission-based mobile advertising is not particularly vulnerable to wearout, at least over the short term. The first comes from the results of the teleJOURNAL OF INTERACTIVE MARKETING
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active. It is the second most personal marketing medium after personal selling—in some ways even more personal than a fixed-line phone. “It’s like my little baby. I bring it into the bathroom” was one focus group comment. The content and language must be right for the audience, which likely means using copywriters from the same target group. It also means not getting too personal. In the words of another focus group participant, “If it said, ‘Hey, Steve’ at the top, maybe I wouldn’t like that—trying to be your friend.” Because the mobile is interactive and individually targetable, as well as personal, it is in principle the ideal medium for “conversational” one-to-one marketing. But conversation brings its own rules that will need to shape the creative work. You must never send the same message twice, a faux pas equivalent to telling someone the same joke twice. This requires creatives and brand managers to keep coming up with new ideas and the advertiser or service operator to have excellent database management. It implies a very different medium for marketing people used to working with mass media, where providing repeated opportunities to see each advert is central to campaign planning.
There may be some exceptions to this by, for example, presenting messages for higher value items at especially relevant times (such as renewal of insurance). Given the nature of the target market, it is perhaps not surprising that in the qualitative research triallists expressed a preference for brands considered to be “cool.” There were some differences in reactions to this by age: older triallists were more relaxed about the brands being advertised. There were remarkably few other differences by age or gender in reactions to the service or in terms of advertising effectiveness. If the service is extended to older age groups we are likely to see more substantial differences appearing. The speed of response generated by PBMA has implications for brand owners. For instance, adverts where a voice call response is required can potentially be used to improve call center utilization as the timing and level of response can be controlled quite accurately.
5. Creative Execution The copy quality is critical. Triallists looked for snappy, entertaining, or informative text adverts; adverts that fall short of this are tolerated but do little to support the brand. When triallists were asked what makes a good text advert, they responded: (a) short, straight to the point (28%), (b) funny/entertaining (26%), (c) area that interests them (20%), (d) eye catching (13%), and (e) prize/promotion (12%). Another lesson was that if a response is required it should be kept simple, not involving the use of another platform and requiring very little keying in by the consumer. Less is more. The same features were mentioned repeatedly in the focus groups. The emphasis on humor may partly reflect British tastes in advertising, but the emphasis on brevity seems likely to generalize to other countries. Certainly, the anecdotal evidence is that SMS users are impatient. One hundred sixty characters is too long for most messages. In creative terms, the copy should be as punchy as for a poster. What is different from other media, however, is that a mobile phone is so personal and interJOURNAL OF INTERACTIVE MARKETING
IMPLICATIONS AND DISCUSSION This study suggests that PBMA has great potential as an advertising medium, especially for campaigns for low-ticket items aimed at younger consumers. However, if its effectiveness is to be maintained in the longer term, a number of issues need to be considered by brand advertisers: 1. Consumers will respond well to text adverts that grab their attention. This could be through humor, relevant information, or even cryptic messages that have “curiosity value.” This is certainly a challenge for copywriters who will need to use as much creativity as possible in 160 characters to maintain interest in a campaign where the same execution cannot be repeated. It is clear that a new set of rules needs to be developed for effective text advertising copy. ●
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in a space of 160 characters—preferably less— without repeating the same execution twice. The trial has shown that it can be done but a new set of guidelines needs to be developed. The mobile phone is, in principle, the ultimate medium for one-to-one interactive marketing—marketing as conversation. It is an intensely personal medium that consumers have close to them at all times and that they use for some of their most intimate conversations and messages. As a technology, mobile is perfectly suited to support such conversational marketing, but the practical challenges are severe. In a conversation, what A says to B depends on earlier interaction between them. A true dialogue would mean that each message is not only new to each consumer but also depends on which previous messages she has received and her response(s) to them. Managing such a dialogue will involve an unprecedentedly difficult combination of database management and creative strategy and execution. Perhaps we should turn this argument on its head, suggesting that firms should experiment with this high-potential but hard-to-use medium as much to improve their integrated marketing communication skills as for the immediate benefit of reaching consumers in new ways. Finally, this study illustrates what can be achieved using simple mobile technology that is already well established. Much of the hype about mobile has focussed on advanced technologies supporting location-based services or wireless broadband communications. Understandably, companies have held back from exploring the potential of mobile because of skepticism about the timing, capability, and reliability of these future mobile technologies (Advani & Choudhury, 2001). The TMC trial shows that mobile is, first and foremost, a flexible, tactical medium suitable for short, timebased communications. More complex applications will happen in due course, but meanwhile, this medium is already here—although currently less developed in the United States than in many markets in Europe and Asia-Pacific.
2. The text adverts must be relevant. The cellphone is a highly personal medium, and texting is considered to be a one-toone personal means of communication. On the positive side, this can be used by advertisers to create cost-effective campaigns, but if the messages, or products being advertised, are felt not to be relevant by the target audience there is potential for negative reactions. It is important, therefore, that profiling information is collected explicitly and used judiciously. 3. Explicit permission is essential. The high levels of acceptance and satisfaction in the TMC trial reflected the fact that all the cellphone owners had given their explicit permission to receive these messages. The danger of spamming is that consumers will become irritated by the intrusion and delete without reading, and the perception of the brand may be harmed. The youth market is increasingly difficult to reach, given its dislike of being overtly “advertised to,” its below average media consumption, and its above-average mobility. This makes PBMA particularly suitable for this segment.
LIMITATIONS AND FURTHER RESEARCH The research reported here was a trial of a service and not the service proper, and as such, it has limitations. The trial was only 6 weeks long, and we cannot say with certainty what reactions or attrition rates we would have experienced over a longer period, although the low attrition rate and the absence of wearout during the 6 weeks are encouraging. There are many opportunities for further research such as identifying which profiling information has the strongest relationship to acceptance of different types of brand/execution and understanding the ways in which the reward can be scaled down without damaging acceptance. Another important area to explore is that of text advertising copy, as it is a real challenge for advertisers to produce text adverts that are entertaining, eye catching, relevant, and effective JOURNAL OF INTERACTIVE MARKETING
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REFERENCES
DMA. (2000). 1999 Economic Impact: US Direct Marketing Today. Direct Marketing Association.
Advani, R., & Choudhury, K. (2001). Making the Most of B2C Wireless. Business Strategy Review, 12 (2, Summer), 39 – 49. Barwise, P. (2001). TV, PC, or Mobile? Future Media for Consumer e-Commerce. Business Strategy Review, 12 (1, Spring), 35– 42.
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Godin, S. (1999). Permission Marketing. New York: Simon & Schuster. Harvey, F. (2001). From Ibiza to 1 billion. FT Creative Business (7 August), 2–3. London Financial Times.
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ABSTRACT This article reports the results of a study of permission-based advertising via mobile phones. The study, part of the proof of concept for a UK startup, specifically explored the effectiveness of SMS text messaging as an advertising medium for reaching young adults. The results suggest that, with the right execution, the mobile channel has the potential to benefit both advertisers and consumers. The findings also include some suggestions about when and how to use this emerging new medium. Although confined to SMS text messaging in the UK, the results are also likely to be relevant to other countries, and to more advanced mobile communication technologies as these are rolled out.
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PATRICK BARWISE is professor of management and marketing and chairman of the Future Media Research Programme at London Business School. He is also an advisory board member of The Mobile Channel. COLIN STRONG is a Director at NOP World, and undertakes a wide range of research in mobile markets.
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BACKGROUND: THE GROWTH OF MOBILE TELEPHONY AND SMS
phone. Twenty-four percent said they would be likely to agree to this, rising to over half of 14 –17 year olds. These acceptance levels offer a promising back-drop to companies such as The Mobile Channel (TMC), who offer a permission-based mobile advertising (PBMA) service. TMC’s service involves recruiting consumers in its specific target market: cellphone owners aged 16 –30 living or working in UK cities. They are asked to complete a short interview detailing their lifestyle and interests, to create an individual profile. The profiling information is then used to target the cellphone owner with up to three relevant text adverts per day. The cellphone owner receives a small reward for each text advert that is sent (5 pence, equivalent to 7 cents). TMC’s proposition is positioned as follows:
In recent years the UK has seen dramatic growth in the adoption and usage of cellphones, with overall penetration at almost 70% (August 2001). Underlying this, we are seeing the market at saturation point in some segments with almost 80% of 18 –24-year-olds now using a cellphone. While voice is still the key application, short message service (SMS) text messaging has also proved to be a big success (Harvey, 2001). Sixtyeight percent of mobile phone owners say they “currently use” this service. This varies greatly by age group (Figure 1). The volume of text messages sent is also impressive. Eighty-one percent of 18 –24-year-old cellphone users send at least one text message a day, and 31% send at least five a day. Text messages are used for a wide range of purposes (Figure 2). New applications such as “group texting” (messages are exchanged between multiple cellphone users for “chatting” purposes) and EMS (multimedia clips sent between users) mean that we are likely to see increased growth and sophistication of the mobile texting market.
Permission Based. There is an increasing trend towards unauthorized “spamming” of cellphone owners with text adverts, where the recipient has not given permission for any text advertising to be sent. TMC’s service is strictly and explicitly permission based (Godin, 1999). Quality of Profile. TMC holds a direct (not derived) profile of over 20 geodemographic and psychographic attributes. This profiling ensures that both mobile owners and brands gain the best possible experience from the medium through targeting segments with relevant advertising.
The Concept: Permission-Based Mobile Advertising In a recent NOP study, UK cellphone owners were asked whether they would be willing to receive text-based advertising on their cell-
FIGURE 1
Text messaging usage by age group.
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FIGURE 2
Types of text message sent.
(7 cents) for each text message received. It was explained that TMC would send them up to three text messages a day. On this basis they would accumulate incentives each week to the value of around one pound ($1.40). The choice of incentives offered were a £5 ($7) airtime voucher (if they had a prepaid cell phone), a voucher that was redeemable in a leading retail store, or a donation to one of two specified charities. Profiling information was collected during the recruitment interview to allow some targeting of the text adverts based on age, gender, and lifestyle. Specific information collected included: (a) leisure interests, (b) number of holidays or breaks taken in the last 12 months, (c) types of music interested in, (d) daily newspaper(s) read most frequently, (e) radio stations listened to on a regular basis, (f) access to and usage of the Internet, (g) occupation, (h) marital status, (i) car ownership, and (j) income. The sample included an equal number of males and females. Five hundred structured telephone interviews were undertaken to explore both the effectiveness of text-based advertising and reactions to the experience. The interviewing was staged over the course of the trial, to give early feedback and allow an understanding of changes in reactions over the trial. Six focus groups were also undertaken at the end of the trial with respondents from different customer segments.
TMC commissioned NOP World to undertake research to test this concept.
Research Questions The study was designed to address five questions: 1. How favorably/unfavorably will consumers respond to the experience of receiving permission-based mobile advertising (PBMA)? 2. How effective is PBMA for advertisers? 3. How much does consumers’ positive response to PBMA (and therefore advertising effectiveness) decrease after the initial novelty wears out? 4. What are the types of advertising task and context for which PBMA is especially wellsuited? 5. What types of creative execution work best?
METHOD One thousand mobile phone owners in Greater London, aged 16 –30, were recruited in February 2001 to take part in a trial of the TMC service. The recruitment was undertaken by telephone using randomized phone numbers. The contact was wholly in the name of The Mobile Channel. Those who agreed to participate were given a signing up incentive worth five pounds (about $7 US) and told that they would receive 5 pence JOURNAL OF INTERACTIVE MARKETING
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4. Product, service or information request: examples included Interflora: “Have you remembered Mother’s Day this Sunday? It’s not too late to say it with flowers, just call Interflora on 0870 904 7474.” And Cadbury’s “Cadbury Gifts Direct—THE guide to gifts for chocolate lovers. For your copy sent direct to your door just text back CADBURY now!” 5. Competitions: examples were Wella, “Free Wella Shockwaves. 1st 50 win! Text back WELLA now” and Lucozade Sport, “Win a signed Premier League shirt from Lucozade Sport. Text back your team’s name 2 enter draw. Lucozade Sport. Have you got it in you?” 6. Polls/Voting: included lottery company Camelot’s advert “Would you like to play the National Lottery using your mobile? For further details text back YES. U 16s cannot play” and Blockbusters, “THE BLOCKBUSTER OSCARS VOTE Marilyn Monroe or Cameron Diaz. Txt us your fave female movie star, past or present. Let U know poll winners on Mar 18th!”
The trial lasted 6 weeks, from February 22nd to March 31st 2001. Thirty-five brands participated, chosen to represent a range of sectors and on the basis of their appeal to the young adult market. The number of adverts sent out for each brand varied but the average was 3.6 per brand. Some of the advertisements were purely brand-building, aiming to raise the brand’s visibility and salience. Most, however, fell into the broad category of direct response, defined as follows: “Direct response advertising is [advertising] intended to either stimulate a direct order, generate a qualified lead that can result in a sale, or drive store traffic that results in sales of advertised products” (DMA 2000). Many of the direct response ads and some of the brand-building ones exploited the mobile channel’s ability to be used for time-sensitive communication, in some cases even picking up on breaking news. Many also exploited one or both of the mobile phone’s own direct response mechanisms—voice and text back. There were six types of advert altogether: 1. Brand building: examples include an esoteric campaign for Tango (a soda) with executions such as “Feed the Tango inside” and “The Tango inside is wise. Feed him.” Another, for Carlsberg, was sent to males 18⫹ at 10.30 p.m. on a Friday night: “Pulled? If Carlsberg ran a nightclub you’d have pulled by now. Probably . . .” 2. Special offers: these were to create awareness of existing special offers. A typical example was from Sega: “A Dreamcast with 4 selected games for just 109.99 pounds at Electronics Boutique or Game. Details in store. Call 08456 090 090 for your nearest store.” 3. Timely Media Teasers: these were used by media organizations to encourage purchase or viewing, for example, the following execution by The Evening Standard (London’s main local newspaper): “Tube strike starts 8pm . . . Anger as Major says ‘walk’ . . . see tonight’s Evening Standard for ‘walking times’ map of key routes in London.” JOURNAL OF INTERACTIVE MARKETING
RESULTS We present the results as answers to the five research questions.
1. Consumer Response The offering received a favorable reaction from triallists with 51% very satisfied and 42% fairly satisfied (Figure 3). Eighty-four percent said they were likely to recommend the service to a friend (Figure 4). Only 7% said they anticipated leaving the service within the next three months if it were to continue. The qualitative research too found an enthusiastic response. Consumers saw PBMA as a good way to communicate with them and an inevitable development. A number of issues are key to consumer acceptance of the service, however: Relevance of Advertising. The very personal nature of the mobile phone compared with ●
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ers. The qualitative research indicated that for older consumers it was a “hygiene factor” that increased their tolerance for adverts that were less relevant and engendered a perception that the service was not simply “junk mail.” For younger respondents, who were less affluent, the reward was more of an incentive in itself. Explicit Permission. Obtaining consumers’ explicit permission to receive text adverts means they generate a much better response than would otherwise be the case. Triallists were told that they would be receiving “up to three text messages per day . . . from a wide range of quality brands that are interested in texting you.” This is easily understood explicit permission that is far removed from a vague “opt-out” option that is often used as justification for irrelevant direct marketing messages. Consumer acceptance of PBMA is critical for the brand. Without it, text adverts are at best ineffective, and at worst, could reduce brand equity by causing resentment, because the mobile phone is seen as very much part of consumers’ personal space.
FIGURE 3
Level of satisfaction.
other media means that consumers expect the advertising to be highly relevant to them as individuals. Seventy-one percent of TMC trial lists agreed that the adverts were relevant to them. The qualitative research indicated that there is some tolerance to adverts that are less relevant provided that most are. TMC’s view is that high relevance can only be achieved from data obtained explicitly from the consumer at the time of obtaining permission, rather than by mining an existing customer database.
2. Advertising Effectiveness The results of the trial are encouraging. It generated high levels of readership, advertising awareness, stronger brand attitudes, direct behavioral responses and some unintended positive effects. (a) Eighty-one percent of triallists did not delete any of the text messages before reading them. Of the 19% that did delete prior to reading, most deleted fewer than a quarter of
Frequency of Advertising. Eighty-two percent of respondents felt that receiving three text messages a day was “about right.” While the qualitative research indicated that some (mostly younger) segments would be receptive to receiving more frequent adverts, there is a danger that too many will become an irritant and trigger a “delete on receipt” reaction. Other issues to consider are that increasing the frequency of adverts could use up message memory (the average cell phone currently holds only about 10 text messages), and that increasing the volume could mean that fewer messages are read thoroughly. Standard of Copy. The copy of the text adverts is crucial. The issue of what makes good copy is explored in a later section but essentially consumers like text adverts to be concise and either entertaining or informative. Reward. The reward system underpinned acceptance of the text adverts for many consumJOURNAL OF INTERACTIVE MARKETING
FIGURE 4
Likelihood of recommending.
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FIGURE 5
Percentage of adverts deleted prior to reading.
FIGURE 7
Speed of readership.
the messages (Figure 5). (b) Most messages were read in full, with 74% of triallists fully reading more than three-quarters of the message (Figure 6). (c) Seventy-seven percent of triallists read the text adverts as soon as they received them. This has important implications for being able to provide time-sensitive information and direct response options that require a very quick text-back response (Figure 7).
advert during the course of the trial, they were not asked to recall anything about the content of the text adverts themselves. Interestingly, there was no relationship between brand recall and the number of text adverts sent out for the brand. This again illustrates the importance of the advertising copy. Brand Attitudes. Two brands were selected to test whether attitudes towards the brand could be influenced by text advertising. In both cases, questions relating to brand orientation were asked of all triallists during recruitment. Half the sample was then sent text adverts about one brand, a leading candy bar, and half was sent adverts relating to the other brand, a TV channel. The follow-up questionnaire repeated the same question set for each brand, both for those who had and for those who had not received the text adverts. This gave an experimental and control condition to help us separate the influence of the text advertising from other advertising being undertaken at this time that may have influenced change in response. The results for each brand are outlined below. Brand salience: Candy bar: The question asked to establish brand orientation was “When you take a break at work or study, what three things might you buy?” Upon recruitment, 3% mentioned the candy bar brand. Upon follow-up, 7% of the control condition (who had not received text advertising relating to the brand) mentioned the brand, while 9% of the experi-
Raising Awareness. Over the course of the trial, each triallist was sent adverts relating to, on average, 21 different brands out of the total of 35. The triallists were asked which of these they could recall using a prompted list. Sixtynine percent were able to recall 11 or more of the 21 brands, including 14% who recalled 16 or more. Respondents simply had to recall the brand name itself for which they had seen a text
FIGURE 6
Percentage of adverts read in full.
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FIGURE 8
Attitudes to C5 pre- and post-trial.
category including texting-back to receive a mail catalog and ordering flowers by telephone for “Mother’s Day.” Nineteen percent of trial lists responded to this type of text advert, on average. Competition entries: There were a number of competitions offered via text adverts. The average response rate was 13%. The most successful ones allowed the triallist to respond by text-back with little or no keying in of additional information. Those that were less successful involved the triallist either going to a website or keying in a lot of information to enter the competition. One striking aspect of the competitions was the speed of response. One example was an offer by a leading cosmetics firm offering a free sample pack to the first 50 people who texted back. This generated a response rate of 20%. Among those who responded, 41% did so within the first minute. Polls: These asked triallists to vote by texting back. Overall, 14% of those receiving a text advert responded.
mental group (who had received advertising relating to the brand) mentioned the brand. Hence, there is an encouraging difference in the experimental group between the pre- and post-conditions. The reason for the increase between pre- and post-conditions for the control group is likely to be the volume of advertising undertaken by this brand using other media during the same period. Although the experimental group has higher recall than the experimental group, the lack of a statistically significant difference between these groups means we need to be cautious in drawing conclusions. Brand attitudes: TV channel: A number of questions were asked to establish attitudes towards Channel 5 (C5) a UK terrestrial TV channel. There were a number of positive differences in attitudes towards the brand pre- and post-trial (Figure 8). Again, the results are not statistically significant, but they provide an indication that text-based advertising can have a positive influence on attitudes towards a brand. Direct Response. Sixty-three percent of the trial lists claimed to have either replied or taken action as a result of receiving a text advert. Their responses fell into a number of different categories. Product, service, or information request: As mentioned earlier, several text adverts fell into this JOURNAL OF INTERACTIVE MARKETING
Other Unintended Responses. Two other unintended responses were also observed. Retention and forwarding of text message: Seventeen percent of triallists retained and forwarded one or more text adverts to a third party, an indication that text advertising can develop into ●
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FIGURE 9
Response to direct response adverts.
phone interviews undertaken at different stages of the trial. The positive feedback received from the initial stage of interviewing indicated that there was no need to amend the program due to adverse reactions by triallists. Furthermore, the findings from independent samples taken at different stages of the trial show no signs of declining enthusiasm or consumer acceptance. Second, the direct response options showed no sign of reduced takeup over the course of the trial. Some of the highest levels of response occurred towards the end of the trial (Figure 9). There was some drop-out over the trial but this was only about 2%, and mostly in the first week after the initial signup, which is normal. There was no indication of triallists dropping out in any sizeable numbers due to a dislike of the service.
viral marketing. Text adverts that were forwarded were those that were seen as especially entertaining or informative. Unsolicited responses: A significant number of responses were generated to text adverts that had not specifically requested a response. These were often humorous, and illustrate the interactive nature of the medium and its potential for generating interaction with key market segments. For example, Carlsberg lager ran a campaign with six awareness executions involving humor and timely use of the medium, for example, “PINT! It’s your round. Probably . . . Carlsberg.” This went out at 10.30 p.m. on a Friday. A range of responses came back including “It was and I got 6 in.” Overall, the response levels generated in this PBMA trial are encouraging. They compare favorably with traditional media such as direct mail, in terms of costs, speed, and response rate. However, as with any limited trial, a concern is that the high response levels may merely reflect a novelty or honeymoon effect. The sustainability of the response can be tested only with a longer experiment. But our experimental design does allow us to test for wearout within the 6-week trial.
4. Suitability for Different Advertising Tasks and Contexts The TMC trial suggests that PBMA can be suitable for a variety of advertising tasks, with some success observed in increasing brand awareness, influencing brand attitudes and generating encouraging levels of direct response. The qualitative research found that triallists considered the mobile medium best suited for advertising low-ticket items that are everyday, frequent purchases rather than large, highvalue items. This is perhaps not surprising, given that consumers will seek more information about high value items than is possible in a text message (Barwise, 2001).
3. Consumer Wear Out Two results suggest that consumer response to permission-based mobile advertising is not particularly vulnerable to wearout, at least over the short term. The first comes from the results of the teleJOURNAL OF INTERACTIVE MARKETING
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active. It is the second most personal marketing medium after personal selling—in some ways even more personal than a fixed-line phone. “It’s like my little baby. I bring it into the bathroom” was one focus group comment. The content and language must be right for the audience, which likely means using copywriters from the same target group. It also means not getting too personal. In the words of another focus group participant, “If it said, ‘Hey, Steve’ at the top, maybe I wouldn’t like that—trying to be your friend.” Because the mobile is interactive and individually targetable, as well as personal, it is in principle the ideal medium for “conversational” one-to-one marketing. But conversation brings its own rules that will need to shape the creative work. You must never send the same message twice, a faux pas equivalent to telling someone the same joke twice. This requires creatives and brand managers to keep coming up with new ideas and the advertiser or service operator to have excellent database management. It implies a very different medium for marketing people used to working with mass media, where providing repeated opportunities to see each advert is central to campaign planning.
There may be some exceptions to this by, for example, presenting messages for higher value items at especially relevant times (such as renewal of insurance). Given the nature of the target market, it is perhaps not surprising that in the qualitative research triallists expressed a preference for brands considered to be “cool.” There were some differences in reactions to this by age: older triallists were more relaxed about the brands being advertised. There were remarkably few other differences by age or gender in reactions to the service or in terms of advertising effectiveness. If the service is extended to older age groups we are likely to see more substantial differences appearing. The speed of response generated by PBMA has implications for brand owners. For instance, adverts where a voice call response is required can potentially be used to improve call center utilization as the timing and level of response can be controlled quite accurately.
5. Creative Execution The copy quality is critical. Triallists looked for snappy, entertaining, or informative text adverts; adverts that fall short of this are tolerated but do little to support the brand. When triallists were asked what makes a good text advert, they responded: (a) short, straight to the point (28%), (b) funny/entertaining (26%), (c) area that interests them (20%), (d) eye catching (13%), and (e) prize/promotion (12%). Another lesson was that if a response is required it should be kept simple, not involving the use of another platform and requiring very little keying in by the consumer. Less is more. The same features were mentioned repeatedly in the focus groups. The emphasis on humor may partly reflect British tastes in advertising, but the emphasis on brevity seems likely to generalize to other countries. Certainly, the anecdotal evidence is that SMS users are impatient. One hundred sixty characters is too long for most messages. In creative terms, the copy should be as punchy as for a poster. What is different from other media, however, is that a mobile phone is so personal and interJOURNAL OF INTERACTIVE MARKETING
IMPLICATIONS AND DISCUSSION This study suggests that PBMA has great potential as an advertising medium, especially for campaigns for low-ticket items aimed at younger consumers. However, if its effectiveness is to be maintained in the longer term, a number of issues need to be considered by brand advertisers: 1. Consumers will respond well to text adverts that grab their attention. This could be through humor, relevant information, or even cryptic messages that have “curiosity value.” This is certainly a challenge for copywriters who will need to use as much creativity as possible in 160 characters to maintain interest in a campaign where the same execution cannot be repeated. It is clear that a new set of rules needs to be developed for effective text advertising copy. ●
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in a space of 160 characters—preferably less— without repeating the same execution twice. The trial has shown that it can be done but a new set of guidelines needs to be developed. The mobile phone is, in principle, the ultimate medium for one-to-one interactive marketing—marketing as conversation. It is an intensely personal medium that consumers have close to them at all times and that they use for some of their most intimate conversations and messages. As a technology, mobile is perfectly suited to support such conversational marketing, but the practical challenges are severe. In a conversation, what A says to B depends on earlier interaction between them. A true dialogue would mean that each message is not only new to each consumer but also depends on which previous messages she has received and her response(s) to them. Managing such a dialogue will involve an unprecedentedly difficult combination of database management and creative strategy and execution. Perhaps we should turn this argument on its head, suggesting that firms should experiment with this high-potential but hard-to-use medium as much to improve their integrated marketing communication skills as for the immediate benefit of reaching consumers in new ways. Finally, this study illustrates what can be achieved using simple mobile technology that is already well established. Much of the hype about mobile has focussed on advanced technologies supporting location-based services or wireless broadband communications. Understandably, companies have held back from exploring the potential of mobile because of skepticism about the timing, capability, and reliability of these future mobile technologies (Advani & Choudhury, 2001). The TMC trial shows that mobile is, first and foremost, a flexible, tactical medium suitable for short, timebased communications. More complex applications will happen in due course, but meanwhile, this medium is already here—although currently less developed in the United States than in many markets in Europe and Asia-Pacific.
2. The text adverts must be relevant. The cellphone is a highly personal medium, and texting is considered to be a one-toone personal means of communication. On the positive side, this can be used by advertisers to create cost-effective campaigns, but if the messages, or products being advertised, are felt not to be relevant by the target audience there is potential for negative reactions. It is important, therefore, that profiling information is collected explicitly and used judiciously. 3. Explicit permission is essential. The high levels of acceptance and satisfaction in the TMC trial reflected the fact that all the cellphone owners had given their explicit permission to receive these messages. The danger of spamming is that consumers will become irritated by the intrusion and delete without reading, and the perception of the brand may be harmed. The youth market is increasingly difficult to reach, given its dislike of being overtly “advertised to,” its below average media consumption, and its above-average mobility. This makes PBMA particularly suitable for this segment.
LIMITATIONS AND FURTHER RESEARCH The research reported here was a trial of a service and not the service proper, and as such, it has limitations. The trial was only 6 weeks long, and we cannot say with certainty what reactions or attrition rates we would have experienced over a longer period, although the low attrition rate and the absence of wearout during the 6 weeks are encouraging. There are many opportunities for further research such as identifying which profiling information has the strongest relationship to acceptance of different types of brand/execution and understanding the ways in which the reward can be scaled down without damaging acceptance. Another important area to explore is that of text advertising copy, as it is a real challenge for advertisers to produce text adverts that are entertaining, eye catching, relevant, and effective JOURNAL OF INTERACTIVE MARKETING
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REFERENCES
DMA. (2000). 1999 Economic Impact: US Direct Marketing Today. Direct Marketing Association.
Advani, R., & Choudhury, K. (2001). Making the Most of B2C Wireless. Business Strategy Review, 12 (2, Summer), 39 – 49. Barwise, P. (2001). TV, PC, or Mobile? Future Media for Consumer e-Commerce. Business Strategy Review, 12 (1, Spring), 35– 42.
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Godin, S. (1999). Permission Marketing. New York: Simon & Schuster. Harvey, F. (2001). From Ibiza to 1 billion. FT Creative Business (7 August), 2–3. London Financial Times.
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