Nokia pushes use of mobile phones for marketing

MANILA, Philippines - Finnish Mobile phone giant Nokia has formed a new division that seeks to maximize the potential of cellphones as marketing tools, a move that is expected to boost sales of operators and content providers. The campaign will also benefit phone users as certain services become available either for free or at a discount. Nokia’s Ad Labs program is designed to teach advertising agencies — initially those based in Boston and in London — mobile marketing solutions, including location-based targeting, image recognition and other emerging technologies to increase consumer engagement. "Interactive advertising is going towards mobile devices," said Marcus Tan, head of Nokia Media Network (Asia-Pacific) during the launch of Nokia’s latest mobile phone models in Singapore recently. Ad Labs is part of Nokia’s bigger plan to encourage companies and advertising agencies across the globe to adapt mobile advertising, which uses the Web and mobile phones to deliver ad messages. In February, the Finnish handset maker formed the Nokia Advertising Alliance, which helps brand advertisers plan, execute and measure mobile advertising campaigns through a single Nokia interface. Nokia has been pushing for mobile phone advertising since 2001. In the same year, the company launched a platform for mobile Internet services that allowed operators and service providers generate mobile advertisements. With the launch of the Nokia Advertising Alliance and Ad Labs this year, the company is confident that the potential of the medium will grow even stronger, especially as subscribers prefer to browse the Internet rather than call. In his presentation, Mr. Tan cited a PriceWaterhouseCoopers (PWC) study, which said 33% of the $100-billion global advertising expenditure will go to interactive advertising media such as mobile phones by 2010. The study also predicts the Asia-Pacific region to outgrow the rest of the world in terms of mobile advertising expenditures, rising to $6.88 billion by 2012 from $1.34 billion this year. Nokia has yet to announce when the Ad Labs campaign will start in the region. Mr. Tan noted that as the medium matures, advertising is transformed being passive to interactive. He said the mobile advertising Nokia is proposing is different from what is used today. "There’s a difference between push marketing and mobile advertising, and that’s a misconception today, especially in this part of the world," he said. "Push marketing is sending messages that the user doesn’t want to receive. What we’re talking about here is a pool-based advertising that gives users the option to download free service in exchange for [clicking on an] advertisement. Here, users are still in control," he pointed out. Meanwhile, back home, efforts are under way to realize the mobile phone’s potentials as a revenue earner. Last month, Connectivity Unlimited Resource Enterprise (CURE), a subsidiary of Smart Communications, Inc. introduced mobile, an ad-generated third-generation prepaid service targeting the market of young professionals. Subscribers of mobile are entitled to receive free load for calls, short message service and data connections by viewing unsolicited ads from CURE. " mobile offers advertisers a unique customer information base that will allow them targeted and tailored campaigns, at a reasonable cost," Ardie Balderama, CURE’s chief marketing officer, said in an E-mail. He added that CURE is the only mobile service provider that rewards customers just by receiving ads. "Our approach to mobile marketing is to be able to enhance the relationship between brands and their customers. This will make the brands more relevant to consumers," he added. "The potential of cooperative advertising [using mobile phones] is big, especially in the Philippines, where there’s a significant population of prepaid mobile phone subscribers," said Nanette Franco Diyco, communications professor at the Ateneo de Manila University. Mr. Balderama said that the reception from both consumers and advertisers has been good. He declined to disclose which companies have signed up for the service. — Mira B. Gloria, BusinessWorld