Why Advertising on Mobile Sucks, From the Marketer’s Perspective | Hacker News Reader

Why Advertising on Mobile Sucks, From the Marketer’s Perspective

distributionhacks.com

61 pointsdmor29 comments

Has it occurred to the advertards that perhaps one of the reasons behind the rush to mobile/tablet devices is that the user experience is SO MUCH BETTER without the insanity that is the advert-polluted desktop internet? After all, $12 million / month from in-app purchases (CSR Racing, http://techcrunch.com/2012/08/15/natural-motion/) suggests that the money is out there.

No, I think it probably has not. We're just page-views to be commoditized to most of these jerks.

First off, if you need to resort to name-calling then you haven't argued your case well enough.

Secondly, my work has never taken my near mobile advertising, so this is purely a personal opinion: you really think that avoiding adverts is anywhere near the top of reasons why people would use a mobile device over a PC/laptop? Have you ever known anyone cite that as a reason? Compare it to reasons such as portability, etc...

Disclaimer: Given a large amount of the small company I work for's revenue comes from selling advertising on our websites, and separate to that I spend six figures monthly on buying advertising elsewhere, I'm one of the "jerks" so perhaps my opinion is biased.

"Have you ever known anyone cite that as a reason?"

To add to this thought - It is well known that people tune out all those ads anyway so it couldn't possibly be a reason to leave the desktop, eh?

mobile without advertisment, a wet dream that will never end - do you really believe in that?

Take the set of every product you buy which has an advertising budget or component (cereal, cars, foods, clothes, electronics, everything that is produced by a compnay with an advertising budget, and which you have paid a single cent to directly or indirectly.)

do the same for services, infrastructure, etc. Remove the advertising component and put it back in your pocket. E.g. if a shoe had cost $50, now it costs $30 because you've removed the shoe company's adveritsing component. Same for every product. You're now 30k per year richer.

However, you are now underinformed. Now pay for some apps that you would have seen the advertising in, in order to inform you. You are now only 15K per year richer after that additional direct outlay.

However, this direct outlay is smaller than the indirect outlay had been, because you are not supporting ad agencies, marketing managers, sending your products' message to people wildly not in its market, and so forth. you are paying for apps which inform you directly.

In addition to the fact that you have "cut out the middleman" - all this friction of paying people to send out messages on your used products' behalf - you (and everyone) ALSO gets the benefit of not having this constant high noise floor, of having to see tampon ads when you're a guy, beard care when you're a lady, and so forth.

In other words, EVERYONE is better off. There really is no catch - just like there really is no catch that there is 0 advertising necessary to get people to know about municipal water works.

If everyone had to constantly see ads about the benefits of getting water from a tap, even the people who already had that, AND it cost you - and everyone - 40% more due to all the advertising...well, that benefits no one doesn't it? We really can live in a cheap and cool world which as as good with respect to advertising as our daily interaction with water works advertising is: none at all, and the product is cheap and works and everyone knows about it and has it.

welcome to the future.

No this is not how it works. Without the advertising, many products would never be discovered at all by the buyer. The opportunity cost of not doing advertising is much higher for seller than just the dollars spent.

Do you really believe people just make products and they magically get purchased? Products are not utilities and your water utility example is so ridiculous I hope you are joking and trolling us all.

"Do you really believe people just make products and they magically get purchased? "

In the future they do.

That's not how marketing works, now or ever. The sole purpose of marketing is to drive sales of a product or service. Marketing is profitable to the seller if (a) it yields more customers/clients than in the absence of marketing expenditures and (b) net income is higher (either larger profit or a smaller loss). See e.g., Apple, which spends more on marketing every year than the combined GDP of several dozen small nations.

Removing marketing would not magically make everything cost cheaper; marketing is usually a small % of a product's costs. Several of my clients are multinationals selling various consumer goods; for them marketing is almost a rounding error compared to COGS, payroll, or facilities (i.e., less than 5% of gross expenses).

The primary effect of removing marketing is that suddenly all sellers and service providers would have difficulty reaching new customers. This would benefit existing companies, but it would kill startups of all kinds (tech and non-tech alike).

I have to disagree with this. It's probably true that e-commerce checkout processes are less optimized on mobile than on desktop, but that doesn't have a huge bearing on ad rates.

The majority of all ad spending is for brand awareness campaigns, not direct response. That's why CPMs for TV spots are still higher than both desktop banners and mobile banners even though TV has no checkout process. The prices are driven by Coca-Cola's spending, not ShamWow's spending. Also, desktop banner CPMs have been going up lately because of the new agency trading desks like Cadreon, Vivaki, and Xaxis. They are helping brands finally buy more digital ads because it's a lot more complicated and fragmented than buying TV, radio, or print.

Also, mobile usage is exploding right now. It makes sense that prices would be low while supply is growing faster than demand. Over time, the usage will level off and the ad dollars will catch up. I think the CPMs then will be a much better judge of the effectiveness of mobile ads, and I think they will be driven by how well brands can engage with consumers through mobile devices.

> That's why CPMs for TV spots are still higher than both desktop banners and mobile banners even though TV has no checkout process.

TV advertising has high CPMs because the results are hard to measure and executives like seeing their ads on TV. It's old school. There's also very little supply compared to online--you may like seeing your ad run during Sunday Night Football but that only happens 16 times a year. Facebook has more eyeballs than that every day.

TV and other "old media" also commands big money because companies like Apple focus on it and still see massive successes. It works. Does Apple even do banner ads at all? I don't remember ever seeing one.

Apple has done banner ads in the past. I remember a particularly attention-grabbing campaign they did a few years ago on the NYTimes home page. It was a fairly creative piece.

Yea, I have only seen their banner advertising on large established media brands (probably kicked in as part of print or TV campaigns). Apple is old school with advertising, Steve was intimately involved in creating the advertisements and I'm sure in placing them.

Apple does do some AdWords advertising (I see an ad pointing to Apple.com when searching for iPhone), but I have not seen any Apple video ads on YouTube. Perhaps that's because they don't want to pay Google any more money than they have to.

I can't think of a single company that needs TV advertising to survive less than Apple does. They have a fanatic user base that will advertise Apple products for free.

On the comparison of TV and online prices: Transactional advertising (direct response) generally costs more than the brand-awareness equivalent, not less, so I definitely wouldn't call the fact that TV is brand awareness the reason it is so expensive. Part of it is supply and demand - people are willing to pay more for TV spots and compete for them, so prices go up, and the fact that there are far less commercials shown on TV than adverts shown online is the supply part. There's also the fact that they are completely different mediums. A more accurate comparison would be TV vs. online pre-roll advertising, although even then it's not completely like-for-like, and the online pre-roll market is young enough that it's too early to see where we will end up price wise.

Regarding brand awareness vs. transactional: worth noting that an awful lot of online banner adverts are paid for from brand awareness budgets rather then transactional. It's not as clear cut as saying that the fact they can be clicked means their purpose is direct response.

> buying stuff on mobile is a terrible experience and fewer people do it than on the full-size desktop browser. Things you can buy easily (games, apps, content) is all cheap and single serve (< $10 per purchase)

It's not a coincidence that most mobile purchases were made from iPads this holiday season. Plenty of other tablets still offer a substandard browsing experience and the more obstacles you hit, the more likely you are to abandon purchasing on your mobile device and switch to a desktop.

It also helps that most online retailers factor in how their site performs on an iPad at this point. You can't just sweep how iOS based devices continue to trounce Android based devices in terms of showing up in weblogs under the rug. Even on a more modern device like a Galaxy S III running up-to-date Chrome, it's a noticeably worse experience.

It's a vicious cycle. They don't show up in logs frequently enough, so the experience doesn't improve (in fact in many cases it gets worse), which in turn results in less attempts which continues to validate the company not offering good support, and so on. Just selling them clearly isn't enough. Google can continue to tout how they're activating <insert insanely high number> of Android devices per day all they want, but something is clearly amiss when people aren't using them enough.

It's not simply about landing pages that confuse a user or sub-optimal user experiences (redirects and other confusing changes to the interface).

Look at the verticals that pay a huge amount for lead generation in the desktop space: insurance, online education, health & wellness supplements, various medical/legal portals, etc.

These high-paying marketing verticals need people to fill out full forms to get the most out of their leads. In addition, having a full experience through the desktop allows users to click on subsequent links for more information so they gain trust before filling out information or signing up for a website. You simply can't get this whole experience on mobile, and until that problems is solved, you won't see anyone doing crazy volume in the marketing world on mobile for those high-paying verticals.

The lead-generating scumbags need to be clamped down on, hard. When a phone service provider sells YOUR customer data to the highest bidding lead-generator, you'll agree with me.

Telefonica - you are scum, and you've lost as many customers as I can talk to.

True -- but there's a difference between unwanted spam where your phone service provider is selling your information via some obfuscated Terms of Service that you barely know you agreed to vs. you searching for something on Google or clicking on a display ad that truly interests you. Of course, there are bad actors in the latter case too, but every business is a lead generator in some way and it's not 100% clear cut.

The article is spot on re: poor placement resulting in worthless clicks. I've clicked on several useless advertisements, particularly on newspaper sites due to floating banners, banners stuck next to the site navigation, etc. The irrelevance of newspaper-site ads is always striking -- particularly when Ghostery shows something like 18 tracking cookies on my local paper's site.

My son (11 mos) racks up some significant clicks on a few apps that we play with (a virtual bongo drum, etc) because he lacks the motor skills, and the ad is placed adjacent to the playing surface.

Everyone these days seems to forget the core value proposition of AdWords back in the day -- they offered relevant, unobtrusive text based ads in the heyday of flash-based "punch the money" and pop-under "x10 camera" ad campaigns. Google always gave a hoot about the desktop user experience early on.

This will all come to a head, very soon.

Mary Meeker's forecast, the very same from which the inset slide is drawn, predicts the smartphone/tablet installed base will overtake desktops Q2 2013.

Something must break. It will be interesting.

For my site I have seen an increase in mobile every single month for the past two years. About two months ago it tipped to 50% being mobile (tablets included).

Also, like the linked article, the CPMs I see for mobile are pathetic in comparison to desktop.

Source: http://bit.ly/JVfaeK

IMO, the most interesting slide is # 17. Advertisers spent 25% of their budget on print media even only 7% of the consumers time was spent on the print media.

While 25% vs. 7% sounds illogical, it isn't necessarily. Maybe one person seeing a print ad gets the same results as 10 people seeing an online ad. Maybe for any single person, one print ad has the same effect as seeing 10 online ads. Maybe print ads reach not only less people, but also different people to online ads, and therefore even if it's less cost-effective it is still cost-effective enough to be worth spending money on. It's not a simple decision to make :)

All these mobile estimates use numbers from adnetworks That do not include the market leader. (maybe monopolist) google.

Yet google is heavily incentivizing adsense publishers to go mobile. Why ? because it is more profitable!

An iPad or iPhone user is way more valuable than a desktop user.

Good point! Fab keeps talking about how their iPad users are much more likely to be spenders on the site, plus their mobile purchases over the holiday season speak for themselves.

I have Iphone, I bought it, because I couldn't afford a new car, yet I could buy something "new".

I think Google Wallet will solve this problem: https://developers.google.com/commerce/wallet/online/

It makes the shopping experience as frictionless as when buying an app.

Traditional banner advertising isn't ideal for mobile screens. Mobile advertising WILL be huge - but it will come from ads being baked into the app experience rather than simple banners.

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