According to a study commissioned by MMA (Mobile Marketing Association), the optimal level of spend on mobile advertising for U.S. marketers should be, on average, seven percent. The findings represented a leap from the less than one percent that is currently being allocated today.
Further, the analysis conducted by Marketing Evolution, a specialist in marketing ROI measurement, predicts it should increase to at least 10 percent over the next four years, based on increased adoption of smartphones alone.
Marketing Evolution's analysis bypasses the simple "share of time (should) equal share of budget" equation that is often offered in lieu of ROI optimization. Instead, it looks at an ROI analysis of mobile based on actual market cost and current mobile effectiveness impact, as well as U.S. smartphone penetration and phone usage data (reach and frequency). The mobile analysis, termed MXS (Mobile's X% Solution), was then merged with data from dozens of cross media studies of other media against specifically defined campaign goals by product category, providing an algebraic analysis of mobile's role in an overall marketing mix.
More detailed data suggests the mobile spend varies based on the marketing goal and industry category, the report finds. For example, with high involvement brands (such as automotive and financial services) and with those seeking to influence purchase intent, marketers should consider a higher than average nine percent allocation, extending to 13 percent over the next few years based on smartphone growth.
"The mobile industry has been plagued from what I call a 'cold start syndrome'," said Greg Stuart, CEO, MMA Global, in a statement. "Finally, we are able to give marketers a level of empirical data that takes out the guesswork and offers a baseline for further discussions on what a rebalanced marketing mix should look like to achieve a stronger ROI on every dollar they spend."
He adds that MMA plans to validate the findings by conducting cross media research with key leading marketers globally.
"Media consumption habits are shifting towards mobile and it is our responsibility, as global marketers, to engage with consumers in the most meaningful way," said B. Bonin Bough, VP of global media and consumer engagement at Kraft Foods, in the statement.