Mobile Marketing – Achieving Competitive Advantage through Wireless Technology

Citation

Vlachos, P. and Vrechopoulos, A. (2007), "Mobile Marketing – Achieving Competitive Advantage through Wireless Technology", Journal of Services Marketing, Vol. 21 No. 7, pp. 539-541. https://doi.org/10.1108/08876040710824906

Consumers' use of mobile communication devices is increasing rapidly. Mobile network operators in their effort to differentiate their product/service portfolio, diminish their revenue dependence on mobile voice services, and recoup the huge investments made on third generation networks, develop new services and evolve their current business practice. While cellular phones were initially used for voice services only, the use of data services, such as text messaging, entertainment (e.g. gaming and music related services) as well as payment services is now starting to catch on. As Keiji Tachikawa, the president and chief executive officer of NTT DoCoMo, Japan's largest mobile operator, declares: “Unless we are able to cultivate and grow data traffic, we cannot guarantee further growth for the mobile communications industry” (Economist, 2003).

“Mobile Marketing” analyzes and discusses‐somewhat superficially‐the status and characteristics of the mobile telecommunication industry and specifically mobile advertising techniques useful for those uninitiated to the industry. The authors reliant upon their extensive working experience have given us a “quick and dirty” guide to the mobile telecommunications industry and the possible technological scenarios of its evolution (e.g. the impact of technologies like Intel's Wi‐Max and Korean's Wi‐Bro on the future of communications). Admittedly, the book is preoccupied with the potential advantages and pitfalls of mobile advertising, and provides authors with quick and practical advices on how to get started with a mobile advertising campaign. The authors try to provide the reader with both the consumer‐side (e.g. uses and gratifications of mobile services) as well as with the supply‐side view (e.g. issues pertaining to content distribution agreements with an operator or aggregator). However, the text in many instances is flooded with technical details (e.g. WAP site developer tips).

The ideas presented in the book are clear and easily comprehended and the authors provide the reader with many specific and illustrative examples. The major strength of the book is its applicability. The content is useful and it could be a useful tool for solving practical problems related with mobile advertising campaigns. However, most of the book is about mobile advertising rather than mobile marketing. This is exemplified in the definition the authors use for the term Mobile Marketing (p. 25): “Mobile Marketing is the use of the mobile medium as a communications and entertainment channel between a brand and an end‐user”. The authors do not seem to take a good care of the important definitional and conceptual issues that the wireless technology raises to prominence. Additionally, many of the terms used in the book are not clearly defined, and the authors interchangeably use terms that somewhat confuse the reader. For example, the authors do not straightforwardly discern between the terms wireless commerce and mobile commerce (the same stands for the terms mobile marketing and wireless marketing). They interchangeably use these terms, but in many cases mobile commerce refers to Internet access and shopping through hand‐held mobile devices, whereas in other cases the same term is used to describe consumers' access to shopping and buying through portable personal computers and/or palm‐tops. Arguably, accessing Internet data services via devices that are quite different in the inherent resources they use (e.g. the size and resolution of the screen, battery consumption, text input mechanisms, memory deficiencies, etc.) is an important issue explicitly factored into consumers' decision making processes and usage behavior. The book would be extremely benefited if the authors reflected on the use of these important definitional distinctions. Most importantly, the books is lacking of conceptual thoroughness (for an excellent conceptual work discussing the impact of mobile communication and transaction services on marketing see Balsubramanian et al., 2002).

Arguably, the must read chapters of the book are chapters one, two, five and six. Specifically, in the first two chapters the authors nicely introduce the reader to the consumer‐side and supply‐side mobile services basics. The first chapter is a gentle introduction to a uses and gratifications study of the mobile phone, where the authors undertake a more sociological perspective of mobile phone usage. Presumably, the most important conclusion made by the authors in this chapter is that consumers use the mobile phone as a tool satisfying needs of self‐expressiveness. Though, not explicitly mentioning it, the authors seem to conclude that in the future the mobile phone will be a transaction‐enabler tool for users. They do not clearly comment on the issue, but they report a research indicating consumers' tomorrow's top ten list for mobile services. Most of them relate to traditional transactions that would make consumer shopping and buying processes more convenient, speedier and simpler (e.g. flight check‐in, loyalty cards, retail check‐out, credit cards, etc.). However, they do not report on the methodological steps involved in this research. In their second chapter, the authors lay down the basics of the supply‐side. They comment on the inherent complexity and the role overlap that characterizes the mobile market ecosystem and they describe the main players that make the market moving (i.e. phone users, network operators, access providers, content and application providers, content aggregators, corporate companies, marketing and media agencies and finally mobile consultants). Therefore, the second chapter of the book is an easy‐to‐grasp initiation to the structure of the mobile services market and the main technologies used. The authors thoroughly discuss extant technologies for text and multimedia messaging (i.e. SMS, smart messaging, EMS and MMS) as well as internet‐like technologies (i.e. the wireless application protocol and the NTT Docomo's i‐mode service). Most of the discussion made in this chapter is for explicating the technicalities and advantages underlying the use of SMS (Short Messaging Service) and MMS (Multimedia Messaging Service) as an advertising tool. Arguably, most of the book is preoccupied with tips, technical issues, advantages and potential backlashes (i.e. mobile spam) of SMS and MMS advertising campaigns. Finally, the authors explain the basics of a Mobile Virtual Network Operator (i.e. a mobile operator that does not have its own spectrum and infrastructure, but business arrangement with mobile operators to buy minutes of use for sale to their own customers). Their comment on this strategy is clearly illuminating though somewhat superficial. For example, would it be a good strategy for a supermarket to employ such a strategy? Clearly, many players in the so‐called traditional markets (e.g. grocery retailing, music television channels) have started utilizing such a strategy, but the motivation underlying such a strategy (e.g. differentiate the extant service portfolio and increase sales, customer bonding, etc.) and its implications (i.e. consumer reactions) are largely unexplored. The next few chapters probe more deeply to the details and advantages of SMS advertising campaigns. The authors compare wireless SMS with traditional and other electronic media in terms of reach, cost and effectiveness/retention. They conclude that wireless SMS is high in reach, low in cost and high in effectiveness, a mix not found in the other media. They report that mobile campaigns and contests have quite high response rates: 94 per cent of messages are viewed, 62 per cent are viewed, 22 per cent of receivers engage in viral activity (i.e. they sent the message to targeted/interested important others) and 18 per cent respond to offers. Finally, they discuss the possible different revenue models for mobile data services (e.g. all you can eat models, per kilobyte charges, per‐session charges, revenue sharing models, etc.). However, their work on this matter is not extensive but rather descriptive and their discussion could be benefited from the mobile services business models literature. The main components discussed in the business model analysis of the mobile data services industry includes both actors and value (service, communication, revenue) flows and is not constrained in the discussion of potential revenue models. The authors conclude that SMS advertising campaigns success factors relate to the creativity of the text to be sent and the issue of mobile spamming (i.e. the unethical usage SMS advertising campaigns). More specifically, they report that four building blocks are important for an SMS campaign to be successful:

1. 1.

   Ad measurement issue, namely defining metrics and methods for tracking ad delivery.

2. 2.

   Creativity in ad formats, sizes as well as display methods.

3. 3.

   Consumer issues and privacy.

4. 4.

   Ad delivery, namely the determination of processes and technology standards for ad delivery.

Another important contribution of the book is that it gives great emphasis on the importance marketers should place on regulatory constraints. Since many of the mobile applications address young people, the authors suggest that great care should be given in communicating and charging to these audiences.

In chapter six, a must‐read chapter, the authors stress the important of content creation and delivery. They conclude that content is critical for prosperous continuance of the mobile services industry and take on the content developer and provider perspective, identifying the basic wireless technologies currently existing for the purpose of content delivery. The authors pinpoint the distinction between over the air (e.g. streaming or downloading technologies, Bluetooth and IrDA infrared) and alternative, more traditional methods for getting content into devices (e.g. the use of multimedia cards, that is portable storage facilities distributed by consumer retailers). Their discussion is an excellent introduction to these technologies, but their text becomes overly and unnecessarily technical in some parts of their text.

An introduction to mobile commerce is included in Chapter 7. Issues related to business models (e.g. billing systems, innovative services, revenue models, etc.) are thoroughly discussed in this chapter. Particular emphasis is given on the pioneering case of Japan as well as on the growth of mobile commerce outside Japan. Concerns about e‐commerce (mobile fraud, speed and power, etc.) as well as emerging technologies (e.g. Bluetooth) are also discussed. Then, Chapter 8 focuses on an important issue, which is mobile spam. It reviews the available relevant technologies and data collection mechanisms as well as it presents a satisfactory overview of the current business practice. Finally, it discusses the mechanisms that could be employed towards controlling mobile spam. Chapter 9 is a must read chapter. It presents the available techniques and tools for measuring the effectiveness of mobile advertising. Measuring the results of a promotional or advertising campaign over the mobile channel is crucial for the diffusion and adoption of mobile as an integrated marketing communications medium. Some useful advertising measurement terminology is also included. Along these lines, the discussion about pricing models and standards is also useful. Finally, the managerial part of the chapter (i.e. recommendations, policy, privacy and strategic considerations) communicate through a straightforward manner a list of “ready‐to‐eat” instructions for the involved business players. Budgeting and planning issues are covered by chapter 10 while chapter 11 is focused on issues related to adult content and on the corresponding control mechanisms. The review of the current business practice worldwide (Table 11.1) is very useful. Chapter 12 (Application environments) is a “technical” chapter. It reviews the available technologies for developing mobile applications (e.g. Java) and contributes to the interdisciplinary character of the book. Furthermore, it includes useful examples with mock‐up demos and in general it could support technical experts during the design and development phase of mobile applications' development projects. The WAP and the mobile Internet are covered in Chapter 13. Specifically, this is a more technical than business chapter, also useful for designers and developers of mobile applications. Then chapter 14 includes a series of case studies and it is quite useful for the reader to go through them towards combining the theoretical parts of the book with real world examples. Finally, Appendix A includes a list of the mobile operators around the world along with some key data for each of them. This list is quite useful for business people and researchers. Appendix B includes useful SMS/MMS abbreviations while Appendix C presents the key legislation/codes and Appendix D the available mobile acronyms.

Mobile Marketing provides an integrated approach to those interested to learn about the business and the technical aspects of mobile commerce. However, it should be clarified that Mobile Marketing is not a state‐of‐the‐art approach as far as the review of the research activity on mobile commerce is concerned. In other words, it is out of the scope of the book to present the available research insights rather to discuss the current business practice and the available technical tools and techniques to do business in m‐commerce effectively. However, the book does not target only business executives but also researchers that approach the field of m‐commerce for their first time. In other words, the book provides a straightforward and integrated view of mobile commerce (and not only mobile marketing) and, therefore, it is quite useful for those that want to learn the basics and the emerging issues in this field to read it. Mobile Marketing, combined with relevant academic textbooks (e.g. E‐Marketing, E‐Commerce, M‐Commerce, Advertising and Promotion) as well as with Journals in this field (e.g. International Journal of Mobile Communications, International Journal of Electronic Commerce, Journal of Services Marketing, etc.) and business reports, could be a basic reading instrument for those people that want to obtain an integrated knowledge of mobile marketing in particular and mobile commerce in general. In other words, any “business oriented” textbook like the present one is a “must” book for any library especially when its reading is combined with reading material like the one discussed above.

In sum, more than anything else, Mobile Marketing is a nice introduction to the basics of the mobile services industry, addressing the needs of practitioners, students and academics. However, the book is lacking of a theoretical approach and presumably its contribution to new knowledge is limited. The text is not at all positioned within the existing literature, something also signified from the inexistence of references. Its applicability and style of writing are highly rated and its major advantage is the concise SMS advertising guidelines provided by the authors. Finally, in any case (as also discussed above) Mobile Marketing meets the objective for which it has been written.