2014 was definitely a banner year when it comes to mobile ad spending. As we enter 2015, even more advertisers are expected to shift marketing budgets towards mobile in even bigger numbers.
With mobile applications in the app stores numbering well into the millions and over half of Americans now owning smartphones this isn’t surprising.
Looking at marketing budgets, a recent study by eMarketer found that the growth in mobile budgets and mobile application development is taking away from money spent on print, television and digital display advertising.
It is obvious that as mobile grows as an advertising medium that other areas will see reduced budgets. But what is unique this year is that we are starting to see digital display having reduced funds allocated to it for the first time. Digital advertising has been the heavy hitter over the past five years and many assumed that it would continue stay unfazed.
We are seeing changes in consumer behavior. Consumers are starting to lean towards mobile devices like smartphones and tablets over computers. Which means that advertisers who are looking to advertise where their customers are spending time and improve their return on investment are reducing their budgets allocated to other advertising methods and increasing their spending within the mobile medium.
The best way to market to your mobile application users just might be through push notifications. 9 of the Top 10 in the 2015 Internet Retailer Mobile 500 use push notifications as part of their program to market to consumers, making push notifications the most-used feature among that group. Digging deeper we find that 136 of the 500 use push notifications.
Push notification use continues to grow with mobile applications and are something you should discuss with your mobile application developer. A study published this past Spring by OtherLevels found that the number of retail apps utilizing push notifications increased 48 percent from 2012 to 2013. Additionally the study went on to further detail that 66 percent of the top 100 retailers in the study with a mobile applications utilized push notifications.
Beyond just being popular amount top retail companies with mobile applications, push notifications have been shown to increase engagement and retention among consumers. In a study from Urban Airship, they detail that consumers who opted-in to push notifications on retail oriented mobile apps generated 40 percent more monthly app opens. The average increase in engagement across a spectrum of industries including media, retail, entertainment, games and sports was 26 percent.
Looking at data gathered by Localytics, they found that users who enable push notifications have a 3X higher retention rate compared to users who disable them.
How do you make your push notifications more productive?
“It’s important to ask users for their preferences when you use push notifications,” states Kimber Johnson, Managing Director, Vanity Point. “This allows you to personalize delivery. Additionally, we encourage our client’s to use push notifications for useful information and not just advertisements. Useful information will create a click but spamming users with ads or frivolous information will just have them deleting your application or opting out of your push notification program.”
As we watch the growth of smartphones sales it has been clear that this has not been solely a hardware related issue. The mobile applications and features available on the various systems are as much or more a part of the decision process than the hardware itself. Mobile application developers have helped push the industry as well.
“When asked about the main reason behind a handset choice, functionality comes up as the most important factor. Between 44% and 48% of buyers, depending on market, are more interested in functionality than the actual brand of a phone” states Chris Smith, BGR.
According to a new whitepaper from Kantar Worldpanel ComTech, in the U.S., smartphone market penetration stood at 55 percent in the first quarter of 2014 and smartphone sales were 76 percent of all mobile phone sales.
This is generally a sophisticated market that does its homework. “As much as US consumers can be familiar with the term ‘smartphone,’” the report mentions, “they still do their due diligence before purchasing their devices. Only 30% of buyers in Q1 2014 did not conduct any research before buying a smartphone.”
For the 70 percent of consumers who do research prior to their purchase, personal recommendations and advice are huge influences, “One fifth of consumers interacted with store sales assistants before going back into a store to buy, and one quarter sought advice from friends.”