Successful mobile marketing business models are dynamic, multidimensional strategic networks of companies and participants in the mobile ecosystem, including organizations like the Mobile Marketing Association, CTIA, Neustar, mobile operators, marketers, aggregators, and application providers.

Verizon Wireless, AT&T, Sprint and T-Mobile USA recently announced they are working together on a common set of marketing guidelines and principles that will facilitate large-scale mobile campaigns. When it comes to attracting mobile marketing and advertising dollars, the four largest US wireless carriers have banded together to compete against other media like Internet, TV, newspaper and radio. Signifying the new types of more cooperative business models that are needed for mobile marketing success, aggregators, brands and content owners (including VeriSign, Neustar, Limbo and Thumbplay) are playing a role in drafting the agreement.

According to the Mobile Marketing Association, the agreement will help reduce the cost and time to roll out a mobile marketing campaign by as much as US$200 million a year. The final document will be released by the end of June, and will cover such things as: promoting a standard way to disclose information to customers; providing efficiencies in running short-code, or text messaging campaigns; and making sure that audit results are more consistent.
The Mobile Marketing Association describes the Mobile Marketing Ecosystem as “a strategic network encompassing all industries, marketing disciplines, and economic and technical models… Brands are not only distributing services and content through the channel, but are using it for brand awareness, prospecting, customer acquisition and customer retention purposes. New mobile content, ‘experiential marketing’ and interactive mobile services are also emerging” (Research Update: Unfolding of the Mobile Marketing Ecosystem: A Growing Strategic Network).

To make the Mobile Channel Value Chain possible, consumer demand must first be established. To create this demand, products, services, events, and content programs are promoted through various traditional channels. For instance, a mobile component added to traditional print media invites consumers to execute a call to action anytime, anywhere. Once a mobile relationship is established with the consumer in this way, brands and content owners can request permission to communicate directly with the consumer further through the mobile channel (Research Update: Unfolding of the Mobile Marketing Ecosystem: A Growing Strategic Network).

Mobile operators can leverage their position in the value chain by providing consumers with relevance and value. Consumers are increasingly bombarded with media and advertising, which begs the question of how much time and attention they are willing to grant these messages on mobile devices. Consumer behavior and attitudes will have to change before significant revenues are generated by mobile marketing campaigns. For example, the value for mobile display ads is still relatively low, largely because of the slow delivery rate of mobile content and its tendency to distract consumers from what they are seeking. Yet despite consumer attitudes and behavior, as well as the economic crisis and its effect on more traditional advertising channels, growth is expected in mobile marketing spending in 2009 (although at a slower pace than previously forecast). JP Morgan predicts that US mobile display revenues in 2009 will reach US$129 million, and US mobile search revenues will hit US$94 million; to put this in context, mobile messaging is expected to generate more than US$2 billion this year.

Last week two US senators introduced legislation aimed at curbing unwanted text messages. The “m-SPAM Act of 2009” is a potential law similar to the CAN-SPAM law that criminalizes email spammers. Unlike email, text messages cost money to receive. The proposed law would prohibit marketers from sending SMS messages to a “do not contact” type of registry. However, by automatically making numbers in the registry forbidden from marketers, consumers could be prevented from receiving the texts they actually want or have signed up for, like coupons or sales announcements. In order for all parties to benefit from mobile marketing, regulators, operators, marketers and applications providers alike will have to strike a balance that ultimately gives consumers what they want: added-value, convenience and relevance.