Everybody shops, so the demand pull in 2013 is to facilitate shopping. The retail industry wants conversion, lead generation and loyalty out of the mobile shopping trend. The smartphone user wants real time relevance, reach and precision. Both want location to transcend proximity. The advertisers are positioned to facilitate but retailers are frustrated with the ineffectiveness of mobile ads; smartphone users are annoyed by the ad disruption; and advertisers deal with poor results relative to website results. The users continue to pull; they are waiting for features to fulfill function. They are waiting for the mobile apps that meet their needs.
Smartphone users want to share their shopping experiences and in fifty percent of their purchases they consult someone they know before they buy as they seek to build their “social capital” through social media. Retailers can reinforce their shopper’s social capital by co-creating value during the shopping experience. Beyond creative merchandising retailers can offer deals and discount that other shoppers connected to the buyer can enjoy and create a community of customers for the retailer long-term.
Here are the advertising trends for 2013:
- Mobile shopping ads will be increasingly local.
- Local mobile advertising networks will emerge supporting large and small retailers
- Content distributor networks will facilitate small merchant exposure
- Native local advertising through Facebook and Twitter will expand
- Advertisers will focus on local customer engagement as the measure of ad effectiveness
BIA/Kelsey mobile analysts expects that half of the projected $4.2 billion in U.S. mobile ad revenues this year will come from localized campaigns — the first year that local is expected to outpace national revenues in this fast-growing market. This represents a 57% increase over 2012’s local mobile ad revenues. Also, BIA/Kelsey projects sustained growth in local mobile ad revenues over the next several years, reaching $5.8 billion by 2016 (58% of the nearly $10 billion total projected mobile ad market for that year).
Many startups are invading this space. One local Chicago startup is walk.by. Belly is in the space, as are plenty of others nationwide. Myservista is in the space. NexDor Direct is a startup in the space. No one has a comprehensive solution that is end to end. Because the trend is local, it’s hard to put together one systemic solution. Local markets by definition are extremely fragmented with high customer acquisition costs. What startups have you seen that are targeting this space and have done a good job?
Off the top of my head, public stocks that might benefit; $FB, $GRPN, $GOOG, $VISA, $YELP-any others you think of?