Archive for the ‘Michael de Souza’ Category

Are Mobile Consumers Better Informed than Salespeople?

November 28, 2011 Leave a comment
By Michael de Souza, VP Media

An editor of Harvard Magazine recently wrote about consumers who are taking on (willingly or not) the roles of petrol attendants, check out clerks and sales assistants. Go to a supermarket in the US, and you’re likely to scan your own purchase. Drive into a petrol station, pump your own gasoline and squeegee the windshield yourself.

“The robots have won,” writes Craig Lambert. “Although the automatons were supposedly going to free people by taking on life’s menial, repetitive tasks, frequently, technological innovation actually offloads such jobs onto human beings.”

It’s not all bad news, though. When it comes to purchase decisions, consumers are winning. The average shopper has become adept at product research – checking product information and comparing prices on the spot.  Even in situations where a salesperson is available, consumers have a bigger view that includes options in other stores and online.

The self-service phenomenon may be charmless, but in this case, mobile technology is empowering consumers with information . . . and offering new opportunities to retailers and publishers.
Read more…

Categories: Michael de Souza

Some Advice for the Makers of White Box Phones (and the rest of us too)

August 12, 2011 Leave a comment
By Michael de Souza, VP Media

Walk into a handset store in the popular shopping mall ITC Roxy Mas in Jakarta or District 1 in Saigon and there’s a very good chance you’ll find rarely heard of makes being sold alongside the international mass-market brands.  Some phones, though, like the Blueberry and ti-phone, have a familiar ring to them.

These generic ‘white-box’ phones are selling just about as well – sometimes better – than their big-name competitors and they now offer the same features, and then some, at a cheaper price.

Telecom carriers and brand-name manufacturers are taking a big hit, but if the no-name upstarts are to survive and flourish, they should take a few tips from the likes of the iPhone and Samsung. Otherwise, they’ll be knocked off the block by the next company that can slice a penny off the cost of a chip or screen.

Background: White Boxes Are In

It’s no secret that white box phones are cheap (US$50 to $100) and have been winning market share for some time. Generic handsets – taken as a group – are the market leader in Vietnam and hold the second and third largest stakes in several other markets. Just take a look at these stats:

  • Vietnam: 40% (Nokia is in second place with 39%.)
  • Indonesia (21%, second largest)
  • India (12%, third largest)
  • Kenya (11.5% third largest)
  • Philippines (11.5%, second largest)

White box handsets today have bigger screens, full QWERTY keypads and processors that can handle most multimedia content. In fact, a consumer can buy a generic phone that can do everything an iPhone or Blackberry can do at a fraction of the price . . . and without having sign a 24-month contract with a telecom carrier.

The user experience can be glitchy at times and is honestly not as good as that of an iPhone, but these generic handsets have additional advantages. Some phones, for example, offer slots for duel SIM cards so a consumer can have more than one active number at a time, a feature that mainstream handsets have shied away from in order to avoid upsetting the telecom companies.

Who Makes the White Boxes?

There are three main categories of players here:

  • Chip manufacturers – like MTK in Taiwan and Spreadtrum in China — who build the processors that power smartphones. They make A LOT of these and produce each processor for as little as USD 2-3 each.
  • Vertically integrated manufacturers, who build and spec entire handsets (buying key components from likes of MTK and Spreadtrum)
  • Retail brands that spec white box handsets and brand them (like Maxis in Malaysia or Nexian, an Indonesian company that was recently bought by India’s Spice Mobile). Their key offers are own-OS phones retailing for USD30-50 each and Android-OS phones that cost about USD100.

Often, the white box manufacturer wills send a glorified salesperson to a carrier, who will specify a price point and the required features (say $55 for xxx thousand handsets with 3G, a certain screen and processor, etc.). The phones are then made based on that order rather than the other way around. The manufacturer very quickly sources the parts and fullfils the purchase order.

Impact on the Industry

Major players like Nokia and RIM are losing market share . . . a fact reflected in their share prices. Nokia shares are down nearly 60% since mid-February; RIM is off 68%. But if you look at our stats, it’s definitely not game-over. Nokia is still the biggest player in most markets.

The white box business model also poses a real threat to telecom carriers. Until now, the two have built a strong symbiotic relationship. Carriers subsidise the cost of premium handsets – driving up demand for the phones – while securing the loyalty of customers who sign 12 and 24-month contracts. But cheap quality handsets turn this model upside down.

It’s worth nothing meanwhile that Samsung is reading the market well. True, the share price of Samsung Electronics is off (28% since mid-January) but the company’s smartphone sales grew by 51% in the second quarter of the year and it’s one of the top two handset makers in 7 of 10 of BuzzCity’s top markets. 

Samsung is setting the right price points and choosing attractive feature sets in developing markets. The Android-powered Galaxy S2 also competes head-to-head with the iPhone in developed countries. And in both cases, Samsung is using attractive content and services to develop a relationship with consumers.

There’s a wave of demand for data meanwhile as users take advantage of the full capabilities of their handsets. New market segments are now accessing multimedia content, browsing the internet and checking email from their phones. This increased consumer usage of course opens up new opportunities for marketing and advertisers.

Lessons for White Box Manufacturers

While competing mainly on price has been a successful strategy to date for white box manufacturers, it’s a risky strategy and one that will fail in the long term (which in today’s mobile industry arrives sooner than you think). Margins are raser thin, so as soon as another company comes along that can shave a penny or two off the component prices, you’re history.

So if White Box #1 is going to thrive – and not fall to White Box #2 – it is going to need to build user loyalty by offering BRANDED SERVICES and CONTENT. Manufacturers should study their markets to learn consumer interests, which they can monetise through content sales and relevant offerings.

This is nothing new. Branded services fueled the success of today’s best-known brands. Blackberry took instant messaging, which had been around for 15 years, created a walled garden and gave people code numbers. It became cool to BB Message. Apple has taken video messaging, called it Face Time and it’s considered revolutionary.

And all of the major players offer content stores. Apple has iTunes, Nokia – the Ovi Store and Android – the Android Market.

Most people now treat handsets like a PC: apps are more important than the device and consumers want to be able to customise their phones.

The Last Word

The mobile industry is changing before our eyes. Twelve months ago, you couldn’t have predicted that Nokia would be in the trouble it’s in now. Change is accelerating and it would be foolish to predict a year in advance. But if today’s white box makers want to thrive, they need to grow up and become brands. And by moving towards the mid-tier market and offering a range of features, it appears some players are already headed in this direction.

Categories: Michael de Souza

Mobile Development Tips: The Hybrid Approach

By Michael de Souza, VP Media

OK, you’re about to embark on a new advertising campaign. One agency tells you that Mobile Apps are the way to go – they’re sexy, there’s no lag in the experience, the app stays on a consumer’s phone forever (unless she deletes it), it’s a fantastic branding tool and besides everyone’s doing it. But another agency has a long list of reasons why you should concentrate on a mobile website: they’re easier to access, cheaper to build, better suited to sales and have a superior return-on-investment.

So what do you do?

Increasingly, the right approach is to build both. Here are five steps to help you along the way . . .

Step 1

Determine which mobile platforms are most prevalent in your target market(s) and, if possible, which platforms are most used by your consumers. To do this, a good place to start is with BuzzCity’s Campaign Planner. If you have an existing campaign in place, you can also use the detailed data from BuzzCity campaign spending reports and tools like Google Analytics to determine which devices are being used to view your campaign and visit your mobile website.

Step 2

Determine whether the number of users on a particular platform justifies your investment.

For example, in Spain, we see that you can hit 60% of mobile users, if you build for Symbian and iOS.

In the UK, you can reach 60% of the market by developing for Blackberry and iPhone consumers.

But in France, there’s no single dominant operating system.

Similarly, if you are launching a pan-European campaign, it’s difficult to choose which operating systems to target, without doing a more detailed analysis of the consumers who access your mobile website. So, in this scenario, you’d be advised to go for the platform-agnostic approach, such as providing an HTML5 version. HTML5 provides a rich, app-like experience within the mobile web and allows you to reach the majority of advanced smartphones, including Android, iPhone and newer Blackberry models.

Keep in mind that the average cost of building a mobile application is US$35,000 and the more platforms you build for, the more expensive the investment.

Step 3

Outline the scope of the campaign that will promote your app and what you want it to acheive. Don’t forget to share this brief with your developer! Here are some examples of campaigns that integrate apps with a mobile web presence:

One of the most successful recent campaigns that integrated apps with a mobile web presence was run by Adidas in India.  It used the BuzzCity Mobile advertising network – and a mobile website — to promote the app, which provided users with useful sports information (tournament fixtures, scores and standings) as well as fun stuff (like wallpapers featuring football stars and promos of adidas football gear). Even without the app, the mobisite had enough content to promote the brand.

Step 4

Make sure your mobile website is not the application’s poorer relative. The app might be slicker or have more features, but your mobisite needs to also stand on its own. A lot of users will see your mobile website first, after clicking on a banner ad. And not all of them will go on to download an application. Some won’t have the right type of phone; others just won’t want another app. So the site itself must also offer a good brand experience.

Step 5

Work closely with your digital agency to determine your specific marketing objectives and the brand associations that you would like to create with the app.

Anurag Singh, a mobile marketer in India whose clients include adidas, Orbit, Reebok, Samsung and Wrigley’s, tells us that there are three main principles driving mobile advertising: information, interaction and engagement. If your goal is to inform, create an app that has information that is proprietary and unique. For greater interaction and engagement, consider building a branded game.

To this list, I would also add e-commerce. Companies in the travel industry, in particular, have embedded mobisites into their business models. If I’m traveling from Singapore to Paris, it’s easy for me to use my phone to buy a plane ticket with AirAsia and book a room with


A word to the wise . . . just because everyone in your brand agency lays an iPhone on the table during meetings doesn’t mean that’s where your market is. Do your research! ; )

Additional Resource:
For more about applications versus mobile website, check out the latest edition of The BuzzCity Report and in particular an article on page 26 called “Innovative Strategies for App Development”.

Categories: Michael de Souza

Mobile Hotspots – The Middle East

By Michael de Souza, VP Media and
Romulo “Je” Alipio, Executive Producer, Games

Although there has been a lot of mainstream media focus on the impact of social media on the Arab Spring, a survey of several countries in the region indicates that there is no sure link between democratic movements and growth in the mobile industry.

Civil war in Libya has stifled the internet, while the success of Egypt’s Tahrir Square demonstrations is helping spawn the creation of more mobile content.

And the most exciting Arab mobile market, in terms of growth and absolute number of ads served, is also among the most politically and socially conservative countries in the entire region, a place where the Arab Spring has not blossomed: Saudi Arabia.

Saudi Arabia

Saudi Arabia currently ranks #5 on the list of BuzzCity’s top global markets. We served nearly 300 million ads there in May alone and our network reaches about six million Saudis (and overseas workers). Over the past two years, mobile ad traffic in Saudi Arabia has grown more than 1000 percent.

One factor that helped trigger growth in the kingdom is that mobile services providers have been actively shifting their marketing budgets into new markets across the globe to exploit hotspot opportunities. We started to see a significant increase in advertiser demand on our network from May 2010, and since then, this has led to higher average spending per campaign, which in turn has attracted more publishers.

We’re not alone in being attracted to Saudi Arabia. Having been dominated by one carrier, Saudi Telecom, which is the largest telecoms company in the Middle East, Saudis now have three networks to choose from. They are the Middle East’s second and third largest regional players: Etisalat of the UAE and Zain of Kuwait.

3G broadband is booming, not just in Saudi Arabia, but in other parts of the region too. As of the beginning of this year, there were about 3 million broadband subscribers in Saudi and 1.3 million in Morocco.

Arabic Apps
The market for apps in the Middle East is still in its infancy. Downloads are small, compared with other regions, due in part to strict regulation of content (censorship of gore, porn and more). Technical expertise and marketing knowledge for apps is also scarce.

But a government-funded initiative in Abu Dhabi called AppsArabia is working to change this. It aims to support the growth of a sustainable app development industry throughout the Middle East and North Africa by investing in promising apps and providing mentoring, promotion and publicity as well as an online community to bring Arab developers together.

The Arab Advisors Group meanwhile reports that as of March 2011, there are 800-plus applications created by Arab developers or available in Arabic in the Apple App Store, Blackberry App World and Android Market.

Handsets in the Middle East
It’s important to note though that the Middle East is dominated by Symbian-based Nokia handsets:

  • Apple has just a 2% share of the BuzzCity Ad Network traffic in Egypt. (Blackberry is non-existent.)
  • iPhone and Blackberry comprise a combined 10% of ad traffic in Saudi Arabia and 16% in the UAE.

So we still really haven’t seen the impact of smartphones in these markets. As smartphones gain more market share, expect further exponential growth.

Egypt v. Libya
The only other Middle Eastern market to rank among our Top Twenty markets is Egypt, which has steadily climbed from 22nd position in Q4 2010 to 14th place in the first quarter of 2011 to #11 in May 2011, with nearly 200 million ads served that month.

Egypt’s popular uprising in late January led to three weeks of mounting pressure and the eventual resignation of President Mubarak from office. In that time, the consumption of internet data soared with a five-fold increase in mobile internet traffic. In the first quarter, Egypt’s mobile adspend also grew very quickly, up 144% despite the political upheaval that swept through the country and the fact that mobile networks were offline during much of that period.

By contrast, as Libya’s uprising descended into civil war, the Libyan government has attempted to restrict all internet access. The comprehensive and sustained blackout has not been completely successful. We still serve about 10 million ad impressions, but this is a fraction of the 110 million ad impressions served in January.

Content is blooming too
The Arab Spring is triggering the production of more local mobile content, though, both by individuals and companies. Yahoo!, for example, announced earlier this month that it’s hiring writers, bloggers and editors to produce original Arabic-language content in Arabic broader and it’s rolling out regional homepages in both English and Arabic.

The bottom line is that while political risks abound, we have only just begun to see widespread usage of the mobile internet in the Middle East. More growth – and lots of opportunities – ahead!

Related Stories
Part 1 – Mobile Hotspots
Part 2 – Latin America

Mobile Hotspots – Latin America

By Michael de Souza, VP Media

Latin America’s mobile markets have grown by leaps, bounds and then some over the past year, but here at BuzzCity, we believe the Latin American mobile story is only just beginning.

Take a look, for example, at Brazil. It’s one of the largest markets in Central and South America. But at the moment only about 10-15% of Brazilians access the web from their mobile phones. That’s a small proportion and it’s growing fast.

As I pointed out in the first part of this ‘Mobile Hotspots’ series, as several key factors come into play – namely lower rates, the rollout of 3G and WiMax licenses, better cheaper handsets and increased promotion of mobile web services – you can expect to see these markets take off even faster and further.

Mexico is by far the largest market in the region, in terms of ads served. Traffic took off after 3G licenses were allocated in the third quarter of last year. Driven by a booming GSM market, mobile penetration has topped 40%.

Brands from a broad range of industries are taking advantage of this growth to reach out to mobile consumers. Some examples include confectionary Bubu Lubu, financial services company Grupo Profuturo and telecom giant Telcel:

  • Bubu Lubu*, a chocolate bar with a strawberry and marshmellow filling, is linking mobile ads to its social media campaigns in Facebook and Twitter.
  • Grupo Profuturo is using mobile ads to reach out to a younger Mexican audience to promote banking, investment and loan services. Banner ads connect to a mobile site where respondents can provide their contact details. Customer service representatives then follow up on the leads.
  • And Telcel, which is by far the dominant Mexican carrier, is promoting the wireless internet service, particularly the idea of being able to work from anywhere. It’s mobile internet offer includes three free monts of service upon signing a contract.

(*Side note: according to the Urban Dictionary, Bubu Lubu is also a term of despair, as in “Wah, Bubu Lubu, I can’t believe my football team is losing!”)

Meanwhile, over in Argentina, one of the country’s leading newspapers, La Nacion, is using mobile ads to promote its new iTunes app, and in the process the app has become one of Argentina’s top iTunes downloads. La Nacion targetted its ads to only appear on iPhones.

Overall, the number of ads served in Latin America experienced triple digit growth in 2010. And these markets are on track to repeat this performance in 2011. Traffic in Brazil and Mexico in the first quarter of this year alone nearly matched nearly matched the number of ads served in all of 2010.

As you can see in the table below, Mexico is followed by Brazil, Argentina and Costa Rica on the list of the region’s most active markets.

What’s good to note here is that the reach of the BuzzCity Ad Network is growing as well.  There are 3.6 million unique users in Brazil, 3.3 million in Mexico and more than half a million in Argentina (as of May 2011). The number of users in Mexico and Argentina grew by about 30 percent in just one month.

Back to the example of Brazil, while a relatively small percentage of users are accessing the mobile internet from their phones, there are 3 – 4 times as many cellphones in the country as PCs. We believe it’s only a matter of time before Brazil becomes like India, where mobile devices are by far and away the most common tool used for surfing the web. (India is also currently our largest market with more than 2 billion ads served a month.)

Flat-rate data tarrifs are already stimulating usage. Of course rates could always fall further.  And like other markets in the region, the key to further growth in Brazil is likely to be linked to the promotion of feature-rich devices and mobile internet content.

Related Stories
Part 1 – Mobile Hotspots
Part 3 – The Middle East

Categories: Michael de Souza

Mobile Hotspots

By Michael de Souza, VP Media

What’s driving the growth of the mobile internet? In case you blinked, the growth has been outstanding… by any measure.

  • There are five times as many mobile phones as landlines. Of the billions of handsets in use, over 96% have at least a basic web browser and over 94% have a colour screen. The number of phones with a browser capable of rendering an HTML web page eclipses the total number of personal computers worldwide by three times.
  • BuzzCity first started measuring ad impressions in 2007. In the first quarter of that year, we delivered 340 million ads. That seemed like a lot at the time. Fast forward four years to the first quarter of 2011 and our network served 23.2 billion ads. In fact, several of our top markets experience more ad clicks in a single month today than our entire market did back in 2007.

And the growth is not just over a period of years, or even year-on-year. Every quarter we see mobile ad markets doubling in size. Every quarter. Take a look for instance at some of our top markets:

  • Spain :  225% growth (212 million ad impressions in Q1 2011, up from 66 million in Q4 2010)
  • Egypt :  144% growth (288m v. 118m)
  • China :  130% growth (448m v. 194m)

All three of these countries, by the way, rank in our Top 20 markets, in terms of the number of ads served.

So what factors, we wondered, need to be in place to create this kind of soaring exponential growth?

To answer this question, we decided to study data from our ad network, focusing on hotspots where mobile web usage is doubling at least every three to six months. We examined traffic, not advertising spend, so we’re simply looking at consumer demand.

Our analysis

We studied several markets where growth has been particularly strong.

India was a natural choice – it’s our largest market by number of ads served and one of our fastest growing. Other countries on an equivalent growth path include Mexico, Nigeria, Saudi Arabia, South Korea and Vietnam.

We mapped periods of intense growth in these six countries to changes in local ecosystems, analysing each market for underlying factors that might explain the increases. We identified four key factors that drive growth. When more than one of these factors comes into play, the effect is exponential.

Finally, we applied this thinking to four regions – Africa, Central America, the Middle East and Southeast Asia – to see if the same four factors have the same explosive effect in the rest of the world. The answer by the way is a resounding “yes”. So, if you are an advertiser and you notice the following factors coming into play in a market, expect massive growth.

Four Key Factors
So, here’s what we found, the top four forces driving growth of the mobile internet:

1.  Falling cost of internet access

This is by far the most immediate and powerful factor in growing traffic volumes. It can be done incrementally (resulting in gradual growth) or through a price-war between carriers (which creates staggering quick jumps).

India provides one of the best examples of the effect of a price war. There are now 750 million active mobile phones connected by 15 mobile carriers. The market activates between 10 and 15 million new SIM cards each month. Competition between the carriers is fierce and primarily price-driven; margins are razor-thin. The cost of data has plummeted to less than 20 US cents per MB. This is not the cheapest in the world, but with 15 carriers fighting over each activation, it’s a good place to be a customer.

2.  Rollout of new technologies such as 3G or WiMax

Next generation technologies allow networks to transfer large amounts of data at high speed. Carriers usually engage in heavy promotion of these new technologies, leading to fast adoption by new users and increased data consumption for existing clients. Governments and regulators moreover tend to award licences for each technology to several providers at once, which leads to a healthy competitive environment.

After the government allocated 3G licenses in India, mobile internet traffic skyrocketed from about 500 million monthly impressions in April 2010 to 2.4 billion a year later.

The same pattern has played out in Mexico, where the number of ads served more than tripled in just five months.

3.  Cheaper handsets with larger screens and better usability

The producers of entry-level smartphones are achieving economies of scale and have slowly flooded markets in Africa and Asia over the past 18 months. Handset prices have dropped to less than US$100 for an Android phone and US$50 for MAUI-based handsets.

The availability of these cheap smartphones has driven massive increases in the consumption of email, web and multimedia content, and a wave of demand for data, as users take advantage of the full capabilities of their handsets. A market share of just five percent for one of these devices can create a noticeable and disproportionate increase in data traffic.

A look at the market share of MAUI-based generic handsets for April 2011 illustrates this:

  • Vietnam     :  42.5 %
  • Kenya        :  13.9 %
  • Bangladesh :  11.8 %
  • Egypt          :  8.2 %
  • Thailand      :  8.0 %

 In several of these regions, the ‘white box’ handsets look set to knock the mighty Nokia off its long-held position as number-one manufacturer. 

4.  Heavy promotion of web services

Carriers from Mumbai to Manhattan are positioning bundles of ‘handset plus data package’ and promoting them as ‘designed for Facebook’ or ‘Twitter enabled’ to take advantage of the growth of social media platforms and other mobile web services. Other key enablers include financial service offerings and location-based services. Here are some examples from competing carriers currently running in Indonesia:

These top-level findings may sound obvious but they are powerful levers for accelerating the growth of a mobile ecosystem. When more than one of these factors is introduced at once, you’re likely to see exponential growth.

Check out the next installments of this series, when we start to take a look at how these factors play out region by region.

Related Stories 

Part 2 – Latin America
Part 3 – The Middle East

Categories: Michael de Souza

Blind Networks: Now You See!

February 24, 2011 Leave a comment
By Michael de Souza, VP Media

Blind ad networks are often misunderstood despite the huge traffic they serve.

With blind networks you can’t specify the individual mobile internet sites on which your ads will appear. Instead, you select a channel, such as ‘Entertainment & Lifestyle’ or ‘Premium Portals’ (there are nine to choose from altogether), and your ads are displayed across the hundreds or thousands of mobile internet sites within that category.

This kind of selection is a necessity, as it is in any long-tail network. Asking brand managers or media planners to work through a list of thousands of individual sites to evaluate their content and context for a good match to the brand that they’re promoting, and then make a selection, would be time-consuming and counterproductive.

The sheer volume and variety of sites in the mobile internet makes detailed planning (of the kind seen in traditional ad schedules for print or television) impossible. And this apparent loss of control makes some brands and agencies very nervous indeed.

It’s an understandable quandary. Media planners and marketing managers have a responsibility to protect brand reputations. If you don’t trust your ad network to deliver the right quality of traffic, it can feel a bit like passing your baby to a stranger.

Mostly, though, these fears are unfounded. The legacy of mistrust among some agencies and brands is a hangover from a time before many blind networks developed their sophisticated targeting and analytic capabilities, which give you the ability to engage the right users. These capabilities, used in conjunction with real-time reports and active campaign management, can ensure that your campaigns are performing in line with expectations, and reaching the right audience.

The points below provide some practical tips on mitigating risk to your brand, and ensuring that you are always displaying your ads in an appropriate context.

Trust in your ad network’s classification of sites

Blind ad networks put a great deal of time and effort into ensuring that the sites listed in a particular channel are classified accurately.

Our publisher team frequently audits the content appearing on our partner sites for appropriateness to the channel in which it’s categorised, reclassifying partner sites whenever necessary.

In the case of large partners with a variety of content on their site or portal, we split their inventory across multiple channels, as needed. So, in a typical news portal, movie, music and fashion content goes into the ‘Entertainment & Lifestyle’ category; weather, news and traffic information would be listed in the ‘Information’ category, and so on.

In this way, we ensure that the traffic that you select is always appropriate, and the sites that the ads appear on are representative of their channel description.

Planning tools and surveys

The first step in planning any campaign is to view detailed information on who’s engaging with your ad network, by using campaign planning tools. These provide detailed user data including age, gender, and location of our users, as well as the devices being used to connect to the mobile internet.

In addition, user surveys provide further insight into interests, usage and behaviour of mobile internet users. Look out for BuzzCity’s latest survey, to be released on Monday 14 February 2011 at the GSMA in Barcelona.

Armed with this information, and an idea of which channel is most appropriate to your campaign, you can go ahead and set appropriate targeting for your campaign.

Price, targeting and the importance of campaign monitoring

Placing advertising directly on specific niche sites to target a specific demographic can cost a lot, per user. The holy 
grail of planning is to find a media channel that reaches as much of your target demographic as possible, at a reasonable cost per user, to ensure that there is no ‘wastage’.

That makes targeting a tradeoff (of cost and reach) that media planners are constantly engaged in. You don’t want to spend too much per user, but you also don’t want to reach too many users outside your target market.

Blind networks offer a number of targeting options to start zoning in on your target market, usually at no cost, including:

  • Channel targeting (eg, ‘Entertainment & Lifestyle’ or ‘Premium Portals’)
  • Time targeting (time of day, date ranges)
  • Context tags (eg, games, information, movies, photos, videos)
  • County targeting
  • Carrier / telco targeting
  • Device targeting (including the ability to specify the brand, operating system, model and feature capabilities of the mobile device)

This cuts out irrelevant traffic, leaving you with an appropriate context which you are comfortable for your brand to appear in.

CPC means you don’t pay for ‘wastage’

Now, there’s a further point to bear in mind. It concerns the CPC (or cost per click) model.

Unlike traditional advertising (which buys only reach or exposure), CPC advertising only charges you for actual interaction with your campaign. Your balance will not budge if no-one clicks on your ads, even if you receive thousands of impressions. You’re paying only for clicks, and that occurs only at the moment that a user displays interest in your product or service.

As long as your ad creative accurately depicts your brand offer, there’s very little adspend wastage, and any wastage would be attributed to people who are not actually interested in your offer, who nevertheless click on your ad. This highlights the importance of an accurate yet enticing call to action.

The important point to remember is that in a CPC world, it’s less important to ensure that you expose your brand only to your exact target market. Wider exposure of your campaign isn’t a problem, because you aren’t spending your budget on any users who don’t click.

The value of continual monitoring and optimisation

As digital marketers (and you’ll know this if you work at a digital agency or specialist mobile company), we’re all constantly emphasising the benefits of digital media – it’s measurable, adaptable, accountable and real time. We criticise traditional media for not being as nimble and ‘real-time’.

Be sure that you don’t fall into the trap of not practising what you preach. Making ongoing changes based on real-time results can be time-consuming. It also requires analytical enquiry and a spirit of competitiveness.
You may decide to hire someone new – an optimisation manager – to monitor your campaigns and get the most out of them. But the rewards are there. It’s definitely worth it.

This is the crucial second part of the equation, which is where you can really start to take advantage of the lower cost of blind networks. By constantly analyzing the results of the clicks that you are getting, and monitoring and tweaking to ensure that you are reaching the right audience, your campaign will remain on track.

It’s too cheap to be valuable!

Some advertisers become suspicious of how inexpensive blind network advertising can be. They think that there has to be a connection between quality interaction, and buying expensive ‘premium’ media. In truth, there are some very good niche, targeted media properties where it’s worthwhile paying a lot per user. Unfortunately, there also a lot of rip-offs out there, capitalising on the assumption that price equals quality.

On a bid-driven network like BuzzCity, our advertisers determine the price that they’re willing to pay per click. Our ad servers allocate traffic based on your CPC bid rate, so the rule of thumb is that the higher your bid, the more traffic your campaign will receive (until your day budget limits your campaign spending).

We’re basically ruled by supply and demand. In countries where there’s high advertising demand and limited inventory available (countries like Malaysia, South Africa and the UK), you’ll need to bid higher than elsewhere to get substantial traffic.

Similarly, there are bargains to be had in oversupplied markets. Countries like India and Indonesia have loads of traffic, and relatively little ad competition for the inventory available. Here, you can get loads of value for as little as 1c or 2c per click (USD).

In these countries, advertisers make the mistake of thinking that this is poor quality traffic, when, in fact, it’s simply traffic that’s in abundant supply. Don’t get trapped in this assumption. You’re getting a bargain!

Publishers and transparency

The anonymity of a blind network suits many publishers well, and number of publishers ask us to sign confidentiality agreements, to ensure that we don’t divulge their participation in our network.
The reasoning behind this is simple. These publishers run premium sites (with high ad rates relative to network advertising). They also usually have an in-house ad-sales team.

They sell as much inventory as possible, usually on a CPM basis, but seldom sell their entire inventory. Once they run out of sold ads, they then back-fill with network advertising from us, to ensure a steady flow of income when they run out their own bookings.

To admit to the wider market that they’re actually back-filling with network advertising (available to advertisers at a much lower cost) would harm their perception as a premium publisher, so they ask us not to reveal their names.
This is the positive side of blind networks – you often get great quality, premium traffic, at a fraction of the price that they charge directly.

Of course, it’s impossible to target only one publisher or site for a campaign on a blind network, but you’ll almost certainly get traffic that you would ordinarily pay a lot more for, mixed in with the rest of the network of sites.

Publishers are also demanding transparency

Publishers of mobile internet sites are increasingly sharing the same concerns that brand advertisers do. After all, they, too, are managing a brand, and they need to ensure that that advertising that appears on their site adheres to their own guidelines, and suits their target audience.

They have insight into who uses their site and what these users want, and they realise that advertising from a well respected brand reflects well on them, creating a richer, better user experience.

Blind ad networks provide publishers with a set of tools to accept and block certain campaigns. Publishers are able to moderate the advertising that’s currently live and scheduled for that day. In this way, publishers are able to select campaigns which are a good fit with the users of their sites. This behaviour further reinforces the relevance of your campaigns.

The bottom line

In short, the mobile internet ad environment is coming of age. For the brands who advertise, and the users who interact, this can only be good news.

Targeting capabilities on blind networks are constantly improving. So too are the abilities of agencies and brands to tweak and optimise their campaigns. Publishers are getting pickier about the advertising that they, in turn, accept.

Do not fear the blind network! It contains a vast amount of rich interaction, and with the right approach and attention to detail, it’s far from the ‘wild west’ of advertising that it’s sometimes made out to be.

Categories: Michael de Souza