The optimal proportion of spending for the mobile channel (based on total spending for a marketing campaign) is at least a double-digits percentage - far more than most marketers are currently allocating - according to the Smart Mobile Cross Marketing Effectiveness (SMoX) study from the Mobile Marketing Association (MMA), Marketing Evolution, and InsightExpress. This article is copyright 2015 The Best Customer Guide.

The study assessed the economic value of mobile compared to traditional marketing channels by closely examining real, in-market campaigns from Coca-Cola, Walmart, MasterCard and AT&T, and concluded that most marketers could significantly increase their overall campaign ROI without increasing their budget at all, simply by adjusting their mobile channel spending upward.

The study also found that mobile is a strong driver of campaign performance across the entire purchase funnel. From upper funnel metrics like awareness and image, to purchase intent and actual behaviour (foot traffic or sales), the empirical evidence proves that mobile has a fervent contribution to campaign results, justifying a double-digit allocation of the entire media budget (not just digital) to mobile.

As the first comprehensive study of its kind, SMoX is expected to trigger a turning point in the mobile industry in the same way similar research drove Internet advertising in the early 2000's. Brands that participated in those studies increased their online ad spend by 30x on average, based on the insights. Additionally, the impact to the growth of the industry, measured as a direct result of the research, was 2.2x.

"The market has acknowledged there is a deep chasm between what brands are currently spending on mobile and consumer behaviour, but now there is real, indisputable proof on the value of mobile to a brand's business goals," said Greg Stuart, CEO for the MMA. "I believe mobile presents the greatest transformation of marketing in our generation. With empirical data, SMoX demonstrates the competitive opportunity for those marketers who figure out how to leverage the power of mobile effectively and optimize their spending with the most impactful allocations in their marketing mix, finally keeping pace with consumers."

The campaigns that were assessed for the report cover a cross spectrum of industries, tactics and campaign objectives. Key findings from the study included:

  • The Coca-Cola Company: Gold Peak Tea Campaign
    In Spring 2014, Gold Peak Tea brand was looking to build brand awareness and drive increased sales using a mix of TV, print, online and mobile to drive messaging. They also wanted to better understand how mobile performed within the marketing mix. After evaluating how effective the campaign was and how each of the various media performed, the study found that mobile drove 25% of top-of-mind awareness, 9% of "home brewed taste" image conversions, and 6% of sales with 5% of budget.
  • Wal-Mart: Back-to-School Campaign
    For its annual Back-to-School campaign in the summer of 2014, Walmart was focused on driving grocery intent to shop among mothers of school-aged children. Using a mix of TV, FSI, online and mobile, the company wanted to uncover how to best use mobile, including the proper allocation and types of mobile advertising that were most efficient in driving their marketing goals. The study found that mobile impacted more consumers per dollar spent than both broadcast and cable TV. Mobile drove 14% of change in overall shopping intent, despite accounting for only 7% of spend.
  • MasterCard: Travel Card Campaign
    In Q4 2014, MasterCard launched its Travel campaign to increase association of the card within the travel sector and to drive awareness of its Concierge app. Using a mix of TV, magazines/newspapers, digital and online (including social), the company hoped to promote their "Take One Day" pledge, inspiring people to take more vacations. The SMoX study investigated the impact of mobile in the above KPIs, quantifying the value of mobile display and video as they relate to the "nester" and "empty nester" target groups. In this case, mobile worked almost twice as hard compared to the campaign average, in terms of the number of people it converted on image per dollar spent.
  • AT&T: Moto X Campaign
    In late 2013, AT&T launched a marketing campaign for its customizable brand of moto x smartphones. The company's key objective was to maximize awareness of the new moto x device and to better understand the role of mobile within the campaign, which used TV, print, online and mobile. The SMoX study examined the impact AT&T's campaign had on its KPI of building brand awareness for the new device among the over 18-year-old demographic, for a six-week period from September to October. The data showed that mobile delivered twice the awareness per dollar spent, compared to TV and digital.

The bottom line
The study concluded that reallocating to mobile (8-16% of the total marketing mix, on average) would drive incremental impact for each of the campaigns, making existing budgets work harder. For example, for AT&T, this would mean 12% higher awareness for moto x. For Walmart, this could mean a potential 15% increase in purchase intent for Back-to-School groceries.

In addition to determining mobile's overall impact on each campaign, the study revealed the most effective ways for brands to implement various mobile tactics (including audio, video, native, location and more) in order to leverage mobile to its full potential:

  1. Mobile audio
    Mobile audio, video and native all performed significantly better than display and were well worth their price premium, presenting an opportunity for increased campaign performance.
  2. Ad formats
    Different ad formats had different types of impact. The display ad banner was a good awareness builder and reminder, keeping a brand salient. Audio, video and native had greater influence on brand perceptions and sales.
  3. Location targeting
    Location targeting (retargeting and proximity) significantly improved the performance of display advertising, driving important KPIs, including actual foot traffic.