In a recent study from the Mobile Marketing Association (MMA), they looked at the complete marketing budget for four businesses: Coca-Cola, Walmart, MasterCard and AT&T. MMA’s goal was to determine the value of mobile ad spending. After reviewing budgets and campaigns from these four companies they determined that bigger mobile budgets lead to higher advertising ROIs.
Companies are not just shifting their budgets to iPhone application development, Android application development, mobile web sites and mobile advertising because it is trendy, they are making the shift because it works.
A perfect example of this is when Coca-Cola launched its campaign for its Gold Peak Tea, they found that mobile accounted for 6% of the sales despite only requiring 5% of the budget. MMA goes on to show that if Coke had spent 10% of their budget on mobile instead of 5% that they would have seen an extra 4% in sales on this single campaign.
When it comes to Mastercard, MMA states that by allocating just 8% of their budget to mobile, they could reinforce their image as ‘a good card to carry while traveling’ by 7X. When looking at campaigns, Mastercard found mobile marketing produced 2X the results compared to campaign average. “I was surprised at how effective [mobile ads] were in relation to other media,” said Adam Broitman, vice president of global digital marketing for MasterCard.
According to Greg Stuart, CEO, MMA, “With very limited effort, brands can increase the performance of a campaign by 30 percent on average (and potentially much more) by simply reallocating funds.[to mobile]”
A key feature to mobile marketing programs, according to the report, was location targeting. Walmart program utilizing proximity targeting to reach people within range of a store proved 1.5X more effective than simply sending ads to people who had visited the store before.
Additionally, the MMA study also points out that ads that contain audio or video components produce a higher return on investment than standard display ads.