There are hundreds of thousands of apps on the market, and the majority don’t make a dime. Yet mobile startups are not nonprofits. From a monetization standpoint, startups have options — and some are better than others.Spotify recently topped 6 million paid subscribers
For those of us aiming to keep the lights on and make money, the great news is that mobile advertising is set to explode. According to Forbes, mobile spending will increase four-fold across the board over the next four years. It has already grown significantly: My company inMarket was bootstrapped and was profitable in just two years. We see real dollars being spent now, and it’s coming from those beyond the early adopters and corporate visionaries.
From a usage standpoint, phones and tablets already represent 23 percent of all web traffic and desktop computer shipments are falling like a rock. Yet only one percent of ad spend targets mobile users. Now that millennials make up the majority of the prime-spending demographic, brands risk completely missing a huge and vital audience.
Our close partner Mondelez International is a prime example.The $36 billion global snack powerhouse spun off from the smaller Kraft last year. Home to Oreo, Halls, Trident and many more, Mondelez recently dedicated 10 percent of its global marketing budget to mobile.
The shift shows tremendous vision on behalf of Global Media VP Bonin Bough, as they’re the first industry titan to align with changing consumer behavior in such a big way. This precedent foreshadows what we’ll see in 2013: multinational brands shifting major dollars toward mobile. They must if they want to keep up with their consumers.
For many brands, it’s not a question of if they should shift money to mobile — it’s how. They realize that mobile advertising is not about just translating banner ads to a smaller screen or repurposing video content.
That’s where the startups come in. Entrepreneurs have broken ground to create new consumer engagements where they matter. More relevant advertising based on targeting options like point-of-sale have proven especially powerful on the bottom line. For example, brands we work with have seen ad engagement lasting for 90 seconds — or three times the average TV commercial — that lifts purchase intent by 30% while shopping in-store.
The impact increases by reaching consumers when they’re out shopping, as opposed to in their office chairs or on the couch. Messaging at the critical “moment of truth” is able to drive measurable incremental sales. It’s a groundbreaking prospect for marketers: Deploy the accountability of online advertising into the real world, where over 90 percent of all transactions still take place.
Think about that for a second: Advertising via mobile can be tied to real-world sales. The savviest brands are already leveraging this idea to their advantage.
We see the smartest large companies focusing on agility and proactively adapting their strategies to capture market share during this once in a generation opportunity. With campaign data justifying mobile’s impact on real-world sales, “waiting and seeing” no longer holds merit. It used to be the case that brands operating in mobile possessed an unfair advantage. Now, those that haven’t entered mobile are playing with a handicap.
For entrepreneurs with their sights set on the cutting edge, the mobile future they imagined when launching their companies is finally here. Brands have moved beyond speculative interest, and new companies with powerful ideas are ready to make things happen. Time will tell which companies are making the right investments, but its clear that mobile will be crowning new winners in 2013.
Veteran entrepreneur Todd Dipaola co-founded inMarket in 2010 to bring the performance and accountability of digital marketing to the realm of retail. Under Todd’s leadership inMarket has partnered with brands like Coca-Cola, Procter & Gamble, and Unilever, and others.
Copyright 2013, VentureBeat