Automakers Still Moving Cautiously on Mobile Advertising
February 20, 2008

By Dale Buss

Auto-marketing executives know they’ll be advertising more on cell phones and other mobile devices in the coming months. But they still have a “prove-it” attitude toward the medium, as mobile-service providers work through issues such as image enhancement and platform standardization.

“The biggest issue with mobile is still that we have to do everything different for each different carrier,” said Gregg Benkendorfer, Toyota’s national manager of media and digital. “Until they really sort that out, I don’t think you’re going to see tremendous growth.”

Christine MacKenzie, Chrysler’s executive director of multi-brand marketing and agency relations, said mobile-advertising providers still can’t “provide us enough data to justify a major move into mobile yet.” She added, “it’s still an area where we’re learning, and we’ll continue to learn.”

But carmakers clearly are moving into mobile in a significant way nonetheless, encouraged in part by the booming popularity of Apple’s iPhone and the richness of its interface.

From Ford’s mobile ads for its Sync voice-activated feature to a Mercedes-Benz mobile campaign that directed consumers to test-drive events for its C-class sedans, at least the industry is aggressively experimenting with advertising even as the mobile medium is still constructing itself.

“We’re upping the bar in terms of delivering richer and more mobile interaction with consumers, even while the landscape underneath us is still shifting very rapidly,” said Stephen Cannon, vice president of marketing for Mercedes-Benz USA. “But you’d better set some money aside to try stuff out in mobile — and if nothing else, you try to digest your learning, so next time you go at it, you’re a little smarter.

“Even though I personally believe mobile isn’t big for Mercedes-Benz yet, we’ve still got to get into that game — or we’ll be left out.”

Luxury Brands Take the Lead

Mercedes-Benz, for example, was pleased with a mobile-advertising effort last fall in which it used mobile messaging with customers and prospects in its database in last-minute efforts to fill out the guest lists for driving events in the 11 top markets for a new clean-diesel version of C-class vehicles. “We had some nice results with that,” Cannon said.

Land Rover is another luxury brand that is pushing the envelope in mobile marketing for the entire industry. It will be “a bigger part of our media mix in 2008,” said Jonathan Renker, the brand’s digital-marketing manager. “Even though it’s still hard to find the right targets, people with iPhones and Treos and so on fit with our basic demographic profile, so we’ve tried to give mobile a chance.”

Renker pronounced Land Rover pleased with its two mobile-ad campaigns of 2007. Last summer it used the Nokia ad platform to target prospects for the LR3 SUV by providing them with vehicle and local-dealer information. Consumers using their mobile devices were served up banner ads for the LR3 that were connected to a Wireless Application Protocol site Land Rover had built for the campaign. If they clicked on the banner, they could download three “action” videos of LR3. They could also enter their ZIP code and get the particulars about the three Land Rover dealers nearest to them, as well as enter their own contact information to receive an LR3 brochure in the mail.

“Though it was a test or pilot program, the interaction and lead-generation rates were significant for us,” Renker said. For example, about 70 percent of consumers who accessed the banner also clicked through to one of the videos. “We hit upon something that would be useful for our brand.”

Then Land Rover upped the ante last fall in a just-concluded campaign on iPhones for its Range Rover Sport, a few months after Apple introduced the paradigm-busting new mobile device. “iPhone changed the game because it has a full operating system, and you can do Web pages on it just like on a computer,” Renker said. “There was a lot more integration of applications that was available to us even than when we ran the LR3 campaign.”

For its Sport, Land Rover worked with San Mateo, Calif.–based mobile-advertising agency AdMob to create banner ads that said “Find Your Land Rover” and ran on the mobile sites of brands that are popular with the vehicle’s key 34- to 54-year-old male demographic, including ESPN, CBS Sportsline and AccuWeather. It also was Land Rover’s first campaign to use text links.

Taking advantage of the device’s advanced touch-screen technology, iPhone users could proceed to a video, enter their ZIP code to find a nearby dealership using Google’s mapping technology, or “click-2-call” a Land Rover dealer immediately to set up a test drive. The upshot, according to a Mobile Marketing Association “case study” of the campaign: 23 percent of those who arrived at the Sport’s “landing page” took one of those three possible actions, including clicking to watch the video (88 percent), obtaining dealer ZIP codes (9 percent) and click-2-call (3 percent).

“In terms of lead generation, this campaign has been a great success,” Renker said. Several hundred iPhone subscribers took advantage of the Google system to locate dealers. And just as important in the still-emerging mobile-advertising arena: “We will be able to use this program to benchmark future efforts.”

Ford ‘Syncs’ with Early Adopters

Ford has been relying heavily on mobile to help establish its technology chops for Sync, the Microsoft-developed, voice-activated cockpit-electronics system that the company began rolling out on several higher-end models last fall. “Sync lends itself to mobile advertising and that audience,” said Ted Cannis, Ford’s director of marketing communications.

So Ford made what Cannis called “heavy investments” in a variety of mobile-specific digital initiatives for Sync, including creating special ring tones and “wallpapers” that mobile-phone users could download. Ford also placed codes in print advertisements that users could immediately enter into their cell phones to learn more about Sync. “It was connecting old media with new media,” Cannis said.

Ford also “did a lot of different mobile ads with different content to see what kind of information really works well on that small screen,” he said. And it tried to appeal to various types of Sync prospects in part depending on how they used their mobile phones. One question, Cannis said: “How do you talk with people who might be interested in the music elements of Sync versus someone else who might be more interested in the phone capabilities?”

Even more important, Ford’s mobile efforts for Sync have coincided with new Internet initiatives, such as “webisodes,” and other marketing trial balloons. “We did a lot of experimentation in targeting the right piece of creative to the right audience in the right medium in an engaging way,” Cannis said.

Getting in the Way

Despite such campaigns, however, automakers’ interest in mobile advertising remains largely experimental. The technology and creative execution remain too raw, and the real audience too undefined, for the industry to treat the mobile milieu as much more than an important marketing laboratory at the moment.

One of the most basic and frustrating obstacles is figuring out how to effectively differentiate content between mobile and other advertising media that have similarities, including TV and the Internet. Toyota got a big dose of that in producing a series of 15 ten-second spots about its Yaris subcompact — in a co-branding campaign with Fox Network’s “Prison Break” serial — that became available to Sprint mobile-phone users in 2006.

“Our biggest takeaway is that you can’t just re-use content that you’ve created for another screen” even if a mobile ad is produced during the same shoot as a TV or Internet spot, said Benkendorfer. “You have to design and develop it especially for mobile screens. You have to light it and shoot it differently; for example, you tend to shoot people only from the waist up, not from the feet up, to help compensate for the size of the screen and the resolution. The same with differences in lighting, when you realize this is going on a two-inch-by-two-inch screen.”

Platform differences also hamstring automakers and other brand marketers. “When we get a (mobile) campaign pitched to us, it’s, ‘OK, this can only be on Verizon or on the Sprint network,’ ” Benkendorfer noted. “Then we have to think about how many people have Verizon phones, who they are, and are those specific people our target. Think about if we were told that a TV campaign was only going to work on Samsung televisions. That’s a disconnect.”

The Mobile Marketing Association, an industry trade group, is working with automakers and other big-brand marketers to mitigate the problem, Benkendorfer said. “But,” he warned, mobile “won’t take off as an advertising medium until they sort all of that out.”

A third significant drawback to mobile advertising in the United States at the moment is cell-phone usage by Americans still hasn’t caught up with penetration in Asia and Europe, said Betsy Lazar, General Motors’ executive director of advertising and media operations. GM, in fact, is still testing more mobile advertising outside the U.S. than in this country.

Nevertheless, Lazar said GM will be “scaling up” mobile-marketing applications in the American market as the carriers’ varying platforms “become more common over the next year or so.” She also noted varying presentation formats also cause problems on Internet sites similar to those posed by the differing screen sizes of mobile phones.

“The sizes on Edmunds.com,” for example, “aren’t the same as for the placements available on Kelly Blue Book. This is a problem prevalent in all media.”

And, Lazar said, the auto industry’s media partners are driving mobile applications forward as they become more savvy about the capabilities. USA Today, for instance, “has a pretty strong mobile platform already,” she said. “So we’re in the paper with them; we’re online with their Web site; and we’re also interacting with them on mobile.

“Mobile,” Lazar concluded, “will be an area of significant growth for us” in 2008.

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