A Google model for mobile advertising?

The week is not over yet but it seems I've already exceeded my quota of interviews with IT executives. Most of them are mobile officials who came over to the country to attend the recently concluded IMMAP (Internet and Mobile Marketing Association of the Philippines) conference.

I picked up a number brilliant ideas from these guys who all argued that the next battleground in digital marketing is in the mobile sector. While Google has undoubtedly made the most money out of the Internet, its competitors, including archrival Yahoo, are locked in a race to conquer the mobile space.

One of the most interesting comments I got from my interviews is from a Dutch guy named Boudewijn Pesch, who is the managing director for Asia-Pacific of Acision. I almost did not attend my session with Pesch because my interview schedule was mixed up with that of another reporter and the venue was the company's office in the opposite end of the metropolis. The late-afternoon gig became messier when strong rains made traveling doubly hard.

But, I'm glad I dragged myself to the Pesch interview since the guy was not the typical executive I usually encounter. He was quite stingy with his answers and responded with a single sentence for each of the questions I threw at him. Thus, I had to constantly ask questions to keep him talking.

At the start of the interview, Pesch proudly pointed out that Acision, a Netherlands-based tech company, is the inventor of SMS or text messaging. Since I had no idea who really invented this technology service, I didn't dispute his assertion and accepted it at face value.

Pesch also admitted that his company developed the Duo service offered by Globe Telecom. The innovative offering allows mobile phone users to make unlimited calls to landlines and other Duo-ready phones at a fixed subscription fee. Pesch stressed, however, Globe had first broached the idea and Acision only provided the technology.

One interesting comment he made was on the issue of mobile advertising. Acision, he said, has actually developed a technology that allows advertisers to insert their ads in the text messages sent by subscribers.

Pesch this is similar to the Google model in which ads that are related to the queries of users are placed alongside the search results. As we all know, Google has extended this model to its Gmail service wherein ads related to the e-mail sent by its subscribers also appear inside their inbox.

The exec said they already presented this service to local operators, which, I'm sure, will thoroughly study it first before deploying it commercially. Pesch didn't mention any pricing scheme, but the only reason I can think of that consumers would agree to have ads in their text messages is for operators to give free subscription service in return.

It would be interesting how this thing will pan out.

Rigodon Update

Internet firm Yahoo has just appointed a new guy to lead its Philippine operations. Jonathan "Jack" Madrid, former head of technology incubator iAyala and managing director of MTV Philippines, will replace tech pioneer Jojo Anonuevo, who will take up a regional post at Yahoo in Singapore.

Madrid also had a short but uninspiring stint as a manager at Dell Computer's call center before the facility was sold recently to Teleperformance. But, I guess the company had to put in a marketing man in charge after Anonuevo, a technology guy, was done setting up the local office.

Also, veteran IT exec Nilo Cruz has reportedly taken up a new post as head of the joint venture of Smartmatic and TIM, the consortium that won the 7 billion pesos (US$144.2 million) 2010 automated elections contract. Cruz's experience and network as former country manager of Compaq, Hewlett-Packard and BT will surely come in handy in his new job.

RP mobile marketers eye $60M ad pie

Local mobile marketers are targeting a larger piece of the local advertising pie as consumers continue to give more attention to digital media, the president of the Internet and Mobile Marketing Association of the Philippines (IMMAP) said Tuesday.

IMMAP president Arthur Policarpio said the trade group's vision is to capture 2%-3% of total ad spend in the Philippines, amounting to $60 million-$90 million, in the next three to five years. The IMMAP is currently composed of 86 member companies, including 37 mobile companies, as well as advertisers, agencies and publishers.

He said that while some companies have spent money on Internet and SMS advertising, a large portion of their budgets still goes to traditional print, TV, radio and outdoor media platforms.

One platform that remains largely untapped by local advertisers is mobile marketing. From less than a million subscribers in 1996, the Philippines now boasts of over 70 million mobile subscribers this year.

Policarpio said one challenge faced by marketers is lack of understanding of mobile's potential and potency as a marketing tool. "The mobile phone is the only device that you have on you almost 24/7. It's a marketing platform just waiting to be tapped," he said at a digital marketing summit at SM Mall of Asia.

He said that beyond SMS, marketers could also look at other mobile marketing initiatives such as bluetooth advertising, mobile Internet advertising and mobile applications.

He noted that Yahoo! Mobile's site receives 1.2 million unique users per month and 128 million page views as of August 2009. He said separate data supplied by Admob showed that local mobile sites logged in 380 million page views a month.

Admob statistics also show a rise in sales of smartphones in the Philippines such as the Nokia N70 and Nokia 3110c, which is fueling the increase in mobile Web browsing.

Policarpio acknowledged though that there are some barriers into increased adoption of mobile marketing including the abuse of consumer privacy and rights, lack of industry-specific research, lack of knowledge on the part of the advertisers and lack of industry-wide metrics and measurement.

"This is the vision of IMMAP - to become the recognized thought leader and center of mobile marketing innovation in the Asia-Pacific region and to leverage global best practices, standards and consumer guidelines," he said.

The IMMAP recently partnered with the Mobile Marketing Association and established the MMA Philippines Local Council. The objective of the partnership between MMA and IMMAP is to foster the mobile advertising and marketing industry in the Philippines.

A shift to digital media

MMA president and CEO Mike Wehrs said advertising companies in many parts of the world have exhibited a shift in brand thinking by seeing mobile as an essential and not just an experimental platform for marketers.

He said that with over 4.8 billion mobile subscribers worldwide, the platform has outpaced the growth of Internet and fixed-line users.

He said he expects spending on mobile messaging to rise to $2.9 billion in 2010. For this year alone, he said advertisers are reallocating $65 billion of their ad budgets from traditional media channels to digital channels including online, mobile, viral and search engine optimization (SEO).

He also noted trends in some countries such as mobile banking, alerts, mobile vouchers and coupons, as well as customer service application, which can be done via mobile phone.

"[Mobile marketing] delivers on the promise of one-to-one marketing. There's a higher level of engagement and interaction controlled by the consumer. Empowering the consumer makes the ad more effective," he said.