Mobile ads speeding ahead – small businesses warned to get on board

Businesses need to rethink their approach to mobile advertising and consider how people use tablets and smartphones, so they can take advantage of the fastest growing advertising category in the country.

This is the warning of a new Telsyte report into the mobile advertising industry in Australia, which found the mobile sector is a huge growth area for display advertising, with total revenue from mobile paid search set to reach $430 million in 2013.

The warning follows others from small business experts who have previously told SMEs to improve their advertising practices by focusing on local keywords to boost their mobile sales.

However, the Telsyte report also points out a key factor – mobile ad return on investment hasn’t reached its desktop counterpart yet.

“A lot of businesses have gone into paid search by default,” Telsyte research director Foad Fadaghi told SmartCompany.

“But businesses need to be a little bit smarter about it. Some keywords are going to be more relevant for smartphones, for example, with shorter keyword strings.

“And for example, tablets are predominantly used in the home. You just need to be aware of those types of conversion rates as well.”

The report puts the total paid search market in Australia at $1.7 billion, with the mobile search market at a massive $430 million. As a total market share, mobile paid search makes up 24.7% of the entire Australian market.

By 2017, Telsyte says the mobile sector will make up more than half of the Australian paid search market, and will be the largest individual digital advertising product segment by 2018.

Experts have been warning SMEs to get on top of mobile search trends for some time. One of the most prominent warnings has been for businesses to buy up locally based keywords in order to take advantage of mobile search trends.

“Many advertisers are still figuring out the best approach to include mobile search within their marketing strategies,” the report said.

“The ROI for mobile search needs to be expanded beyond just measuring online sales, but other metrics, such as offline sales and other factors that are important in the path to purchase.”

Fadaghi says businesses need to consider price as well as geographic locations and the importance of localisation when investigating possible keyword mobile ad strategies.

“Keywords are based on an auctions-based system, and in some categories the smartphone prices are lower than the desktop prices.”

“So for some businesses, particularly local businesses or those that have simple products, those prices might be good value. It’s well worth doing some research and figuring out which categories are best.”