How CMOs Will Update Their Ad Strategies To The Mobile Age

How CMOs Will Update Their Ad Strategies To The Mobile Age

By on May 8, 2014 in Blog | 0 comments

Our mobile-first world is creating opportunities to reach consumers hyper-targeted like never before, but all too often, actual ads on mobile are still far from their full potential. Consider a special e-mail offer from your favorite airline: If you happen to see it while casually checking e-mail on your mobile phone, it’s so well-tailored to your needs, there’s a very good chance you’ll click. Thanks to advances in CRM technology, many businesses know how to reach their customers and systematically build incentives to keep them engaged and monetized.

But what if you’re a CMO working with a competing airline? Shouldn’t you be able to target that same customer with a better offer? (Customers considering the offer often wonder about that same thing!) This is how CRM differs from advertising: The former primarily handles interactions with an existing customer or prospect, while the latter also reaches non- or ex-customers — including those using a competing service.  Ideally, a CRM can (and should) be able to target non-customers as effectively as existing ones – at the moment, however, they don’t.

Mobile Age understandably, then, many CMOs instead buy large scale advertising campaigns which shower broad audiences with undifferentiated messages.  They have little tools or insights to do better, and lose a lot of information when handing over their media spending to a trading desk or other third party.  And mobile is a channel which is rather inefficient for broad advertising (click through rates on standard mobile display banner ads is low), until it becomes targeted and fully in line with the personal nature of a mobile device (click through rates on highly targeted, native, in-stream ads on Facebook mobile are high.)  Hence most money is not spent on mobile (where the audience has their eyes) but more traditional and less targetable channels.

With so much money at stake, the future will look different.  Gartner predicts that by 2017, the CMO will spend more on IT than the CIO. As part of this trend, it’s likely

CMOs will adopt advertising technology as in-house solutions, and become as sophisticated in communicating with non-customers than with existing customers.

This will shift advertising from a media business to an enterprise software business.  While media purchasing will still happen, the new value will reside in the technology support to buy only those impressions which qualify a specific audience relevant to current campaign goals (often procured with RTB.)  Bulk purchases, scale rebates, and kickbacks will be replaced by smart advertising, with a message tailored to each individual by each supplier.

A few companies are already seeing this trend and are adjusting their positioning, among them AppNexus, MediaMath (“Marketing OS”), Rubicon (“Advertising Automation Cloud”) in online; more recently, we created the first mobile-first player to offer a SaaS-based mobile advertising management platform (MAMP) at LiquidM.

Our collective challenge ahead is to create platforms that can offer real-time competitive ad channels for hyper-targeting. Campaigns, messaging and audiences must be as sophisticated matched than those of a CRM; feedback loops between targeted media buy and conversions must become so effective, that a CMO can reach out to their competitors’ top customers, just as easily as they currently do with their existing ones.

If we are successful, our combined efforts will shift the way CMOs think about advertising – from a media purchasing business to a technology business – and help unlock far more marketing dollars (especially in mobile) than have ever been spent before.

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