Close-Up: How should agencies handle mobile?

There is no consensus in adland on how to cope with mobile marketing, John Tylee discovers.

Deciding how best to capitalise on the growing importance of mobile marketing presents agencies with a conundrum.

Do you follow the example of M&C Saatchi, the latest of the adland heavyweights to put down its mobile marker by acquiring a 60 per cent stake in the specialist operation Inside Mobile?

Or do you build your expertise in-house so that you can match your offering to the demand?

It's not an easy call. The most recent figures from the Internet Advertising Bureau, which were published in May last year, show that although UK mobile adspend has been growing by 99.2 per cent year on year, it was still worth just £28.6 million in 2008.

Most are agreed that there's no one answer to how the industry should react to the march of mobile marketing and that, as far as agencies are concerned, it's very much horses for courses.

Moray MacLennan, the M&C Saatchi worldwide chief executive, believes the need to act quickly to capitalise on mobile marketing's potential had necessitated an acquisition: "Mobile is the future of mass communications."

However, other agencies have opted for a more measured response. "At present, mobile is a very small area of spend for clients but I believe it will become a powerful medium driven by the rapid growth of smartphones and the iPad devices that are coming," Stephen Woodford, the DDB London chief executive, says.

"What M&C Saatchi are doing makes perfect sense for them, as far as they have a group of specialist companies, but our focus is on integrating skills and reducing the barriers between specialisms, so we have built our expertise into our Tribal DDB operation."

The problem is in striking a balance between a gung-ho approach and holding back for too long.

Jon Mew, the head of mobile at the IAB, understands agency caution but warns they should not sit tight for too long while the best mobile marketing talent gets snapped up by rivals.

MacLennan also stresses the need to look at the global implications of the phenomenon. M&C Saatchi plans to extend the Inside Mobile offering across its network.

And MacLennan believes that this is essential because of what's happening in the emerging markets of China and Africa, where consumers are "leapfrogging" computers and transforming mobile into the most important form of mass communication.

Nevertheless, David Miller, the former managing director of Wieden & Kennedy, Amsterdam and a founding partner of the mobile agency Parrott & Miller, warns agencies to proceed with care.

Clients don't yet have the budgets for mobile marketing, with only a handful of brands, such as Lynx, actually making an impact on the market. And even if they did, few comprehensive case studies exist that will give most clients the confidence to take the plunge.

Moreover, because mobile marketing is so new, nobody has properly worked out what to charge for it. Agencies planning to offer a mobile marketing service to clients will need to build into their plans the fact that they won't make any money from it for a considerable amount of time, Miller says.

"The fact is that none of us agencies know when mobile marketing will take off and we have to plan accordingly," he adds. "But if digital is any guide, then we will have to be patient."

Mew concludes: "As far as consumers are concerned, the day of the mobile has come and gone.

For the ad industry, it's yet to arrive. But there's no single way for it to meet the challenge."

AGENCY HEAD - Moray MacLennan, worldwide chief executive, M&C Saatchi

"Within five years, mobile communication will be at the heart of the business of an awful lot of clients so we felt we needed to act quickly - and to do it with the best people.

"We could have hired them but doing it through acquisition means that we can get the momentum going fast. Why? Because history teaches us that the convenience of mobile technology means it will develop faster than digital.

"Also, InsideMobile is a good size, has the kind of holistic view of mobile marketing that clients find useful, and will operate within our building. We think that's better than just hiring some specialists."

CLIENT - Jeff Dodds, brand and marketing director, Virgin Media TV

"Mobile marketing has been the next big thing for as long as I can remember and we certainly see it as an opportunity. However, when we put together a media plan we don't break mobile marketing out.

"Also, there's a misconception that mobile marketing is cheap. It may be in financial terms but you have to invest a lot of time and energy in making it work effectively for you.

"Mobile marketing will become more important - but I don't see a time when clients will be telling their agencies that they want to have a big mobile presence."

ASSOCIATION - Jon Mew, head of mobile, Internet Advertising Bureau

"There's no one route into mobile marketing, and different approaches will work for different agencies. Some may hire the talent, some may acquire and some will work in partnership with a mobile specialist.

"What's certain is that the major agencies need to do something. If they leave it too late to enter, the best talent will have been bought.

"I can understand why they're cautious because of the difficulties in making money on mobile marketing business.

"However, there's a danger that caution leads to short-term thinking. Mobile marketing allows you to do things you can't do in any other media."

MOBILE SPECIALIST - David Miller, founding partner, Parrott & Miller

"If you're going into mobile marketing, you have to make sure you do it right. That means having the creative, media and technical talent that can make it work.

"Even then, don't expect to make any money out of it for at least three years.

"Meanwhile, don't just spend your time evangelising about mobile marketing to your clients. You need to help them understand how to do it. At the moment, most of them have neither the budget nor the head space to be able to think about it. Until creativity is the focus of mobile marketing, it won't take off."

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