kimbayne.com: Published Works:
e-Business Advisor magazine

Wireless Devices: The New Marketing Frontier
by Kim M. Bayne
e-Business Advisor magazine
December 2000

At a time when many marketers have finally assimilated the quirks of advertising on the Internet, a new medium comes along to challenge our business plans: wireless. Marketing to wireless devices involves reaching users of mobile phones, personal digital assistants (PDAs), and two-way pagers, to name a few.

Mobile commerce, or m-commerce, potential is staggering. About 31 percent of the U.S. population uses cell phones, according to the Cellular Telecommunications Industry Association. With more than 100 million (and growing) U.S. mobile phone users, the wireless revolution is attracting about 45,000 new subscribers per day. Researcher IDC estimates that worldwide wired Internet subscribers will number more than 540 million by the year 2003, while PCS/cellular subscribers could top 740 million. Analysts at Ovum, Ltd., an international research and consulting firm, predict that wireless advertising will grow to a whopping US$1.2 billion in 2003, rising to US$16 billion in 2005.

Opportunity vs. annoyance

There are two main types of wireless marketing programs, advertising and publishing, with the line between the two constantly blurred, as it is on the Web.

RECOMMENDATION: Regardless of which marketing strategy you choose for wireless users, it's best to observe the same customer etiquette widely accepted on the Internet: Always opt-in. In light of potential user backlash, always obtain permission before marketing to a customer.

Until recently, wireless users have been reluctant to provide device contact information to businesses. The possibility of receiving advertising on a mobile device has been an experience worth avoiding. In the wrong hands, contact data may be abused, and security threatened. In addition, receiving unsolicited or too much information on a wireless device could damage work productivity and/or have a negative financial impact on the costs of operating a wireless device.

Yet, history repeatedly demonstrates that users' resistance doesn't easily discourage marketers. Marketers will find a way to appeal to the most stubborn of customers.

OPINION: The key to gaining mobile consumer acceptance is to be "cautious with advertising and integrate it in a sensible way with the content," says Derek Kerton, senior manager of wireless for Walt Disney Internet Group. Integrated content could include free access to stock prices, weather, and sports, accompanied by a small, innocuous logo or sponsorship message.

AT&T, Sprint, and Verizon, to name a few wireless service providers (WSPs), work with content partners to provide subscriber services that range from simple text messaging to interactive wireless Web access. Many services are advertiser-supported. Any wireless advertisements are typically coupled with valuable services such as the ability to check flight schedules (figure 1). Addressing cost-conscious users, WSPs often don't charge for basic wireless content and/or make unlimited access a condition of many service plans.

Wireless marketing advantages

Marketing to consumers and business prospects on the go has many advantages.

KEY BENEFITS: For broadcast media, such as ABCnews.com and ESPN.com, delivering content 24x7 translates to additional news outlets and bigger audiences. For e-tailers, delivering offers and/or coupons via wireless can mean the difference between new visitors and passersby on the Web. For other businesses, providing practical information, advice, or m-commerce capabilities by wireless devices can spell the difference between a profitable bottom line and a barely noticeable dent in the e-commerce landscape.

LEAD THE PACK: Disney's Kerton believes it's important to reach early adopters, even though the majority of mobile users don't yet own Web-enabled wireless devices. To maintain a strong market presence, the Disney Internet Group is aggressively developing in-house applications that target both current and future customers through a variety of devices, including the home PC, home appliances, and wireless tools. Disney owns several properties, comprising the six most visited sites on the Web, and continues to migrate current properties to wireless environments.

Getting started

If you're considering wireless marketing, keep in mind that initiatives aren't limited to obvious applications and value-added services.

EXAMPLES: AT&T's Digital PocketNet Service works with several different vendors to provide a diverse array of lifestyle-related and commerce options for the mobile user. Recipe and meal planning service AllRecipes.com works with AT&T to offer a library of food-related information to wireless users--a helpful tool while grocery shopping. Gift-Certicates.com lets mobile customers buy gift certificates from hundreds of brand-name merchants and restaurants--a great idea for users on the road who forgot Mom's birthday. MapQuest.com lets wireless users obtain step-by-step directions to targeted destinations while in the car. And for those on cross-country car trips, Vicinity Brandfinder at vicinity.com helps people locate a nearby gas station or hotel. Zagat.com points to a close restaurant based on budget and menu.

BOTTOM LINE: New content providers launch every week, making the value of wireless marketing an issue that's hard to ignore if you want to remain competitive.

David Wilson, executive vice president of business development and marketing for WindWire, believes location-based wireless advertising has the greatest potential. "Pizza Hut could serve an ad to everyone that's viewing local content if that's a city where they have a franchise," he suggests. WindWire, creator of WindCaster, a wireless marketing and advertising network, delivers advertising and promotions to the most commonly used wireless Internet devices.

TACTICS: Beyond creating original material, you could sponsor pre-existing content or share in the costs of its development. For example, Dole Food Company could tack its ad onto wireless recipes provided by the Pineapple Growers Association of Hawaii. A discount brokerage house like Charles Schwab or Ameritrade could sponsor a stock quote on CBS Marketwatch's Wireless Access Protocol (WAP) page. Pillsbury might team up with AllRecipes.com to offer a wireless coupon that ties in with one of the wireless recipes.

Wireless marketing challenges

CAUTION: Not all wireless content appears the same to all users. Some content is purely for digital cell phones that aren't Internet-ready and only accept a limited amount of text-based messages.

Depending on the user's device and model, a wireless publisher could be limited to 120 characters of ASCII text through email. Such content is more "push" than "pull." A wireless marketing program that's limited to short text-messaging devices doesn't benefit by the interactivity needed to close a sale.

Meanwhile, the market for Web-enabled phones is growing rapidly. Nokia, Ericsson, and Motorola are just a few of the WAP manufacturers whose products offer multiple-choice menus and real-time Web access. Kerton says U.S. users "normally buy a new phone every 24 months." Eventually, it's likely that advertisers will deliver e-commerce and customer service functions to most mobile devices in use.

Even if you can deliver content to sophisticated devices, you should still consider minimizing your WAP-oriented graphics. On a wireless device, you only have a few seconds to deliver a message. Fewer graphics on PDAs, for example, mean faster downloading on the wireless Web.

Considerations

1. Marketing wirelessly may not be for everyone. Related projects often create server hardware, software development, systems integration, and staffing needs. Computer product manufacturers and system integrators are developing the Mobile Application Server (MAS), a turnkey combination of hardware and software tools designed to retrieve data from diverse publishing sources and render it for wireless delivery. A few companies are on the bleeding edge of such developments, including Everypath.com, which announced the release of its MAS in October, and Nokia, which offers its mPlatform Solution for serving wireless gateways and network portals. Bundled solutions can address everything from secure order processing to customer billing functions.

2. For businesses with unique needs, there's the process of understanding WAP and its related Wireless Markup Language (WML). WAP is the computing specification that lets users access information from mobile devices. It's so new that a single standard has yet to emerge. But that hasn't stopped ambitious wireless marketers from building their own content-delivery applications in-house.

According to Disney's Kerton, "There's a steep and short learning curve [to using WAP]. You have to have a wireless designer who can build the application for you. But once those skills are in place, you're ready."

3. Some vendors have shortened the learning curve for those who don't have the patience, time, or resources to code for a new platform. Through a process called "transcoding," application service providers offer software and services that convert the main language of the Web (HTML) into the language of the wireless world (WML).

Transcoders read Web sites and automate how the content should be formatted for delivery to a portable device. In some cases, the content translation can be misinterpreted, which is why some transcoding services are better than others. The advantage of transcoding is to let businesses leverage existing Web site material without eating up the time and expense of creating an additional content source. One transcoding technology is IBM's WebSphere Transcoding Publisher Version 3.5, which adapts content to match the capabilities of the receiving device. It converts data written in HTML or XML to formats such as WML, Handheld Device Markup Language (HDML), and iMode (the latter of which is used for smart phones in Japan and other Asian regions).

WARNING: "You can get satisfactory results if you're not looking for perfection," says Kerton. The concept of transcoding might "work if you don't care that one of the columns (as seen on a microbrowser) is out of line," he adds. WindWire's Wilson says companies can avoid translation errors entirely by deciding "to build different content trees."

4. The cost of marketing wirelessly varies. For turnkey solutions providers, such as WindWire's WindCaster ad network, media placement ranges from US$30 to US$100 per thousand (CPM) users. Plus, depending on the amount of upfront development work, "we may build it for free or we may charge for it," says Wilson, taking into account the value and uniqueness of the proposed content.

TIP: If the ASP route doesn't appeal to you, you must research start-up hardware and software costs.

5. The time it takes to establish wireless marketing programs varies by project. Simple text-based messaging campaigns could be launched in a few hours, while more extensive interactive wireless programs might require months of development. To determine how long your wireless marketing program will take, consider the following:

a. Decide your budget limitations.

b. Formulate the goals of your wireless marketing program.

c. Fine-tune your content.

Once you've addressed those issues, it's time to look around for service providers and/or additional staff.

Where to from here?

Wireless marketing is still a new concept. We need groundbreaking tools, marketing strategies, and tactics. With its current interest and momentum, however, it will definitely become easier to enter the game over the next few months.

Article COPYRIGHT 2000 Advisor Publications, Inc.

Article COPYRIGHT 2001 Gale Group

Copyright 1994-present, Kim M. Bayne, wolfBayne Communications, P.O. Box 30208, Tucson, AZ 85751-0208 USA. All rights reserved. All other copyrights are the property of their respective holders. The contents of this document and any other document residing on this site may NOT be published, broadcast, copied, rewritten, transmitted, translated or otherwise distributed, in whole or in part, in any form or by any means, electronic or mechanical, for any purpose, without the prior written authority of the copyright holder. This Web site is protected by U.S. Federal and International Copyright Law.