Our column for BusinessWeek on how advertisers may be squeezed by new mobile devices stumped some readers. Many commented that people just won’t put up with ads on cell phones; others said mobile ads will have higher response rates; still others suggested that cell phone use will be additive to web use, so really there will be no reduction in overall ad inventory.
Shelly T said the entire column was surprisingly thin, uninteresting, and poorly thought out. Yikes!
But when we see new mobile concepts like this BenQ Siemens Black Box, where the very interface layout changes depending on the function you are using, we can’t help but believe mobile devices will replace some old-school PCs.
One way to think of mobile replacing PCs is it is not an either-or proposition. Even if time spent on Google and content web sites diminishes 10% or 20% due to people spending hours on iPhones, that will create huge cascades across web business models.
All content media is supported by advertising; and advertisers invest their dollars like you invest in a portfolio of stock funds. For example, look at the current death spiral in newsprint. As readers abort print for online news, response rates from newsprint ads decline. A marketer with $1 million to spend looks at the $350,000 allocated to newsprint and thinks: Hmm. I better trim that to $250,000 next year, and invest the $100,000 remaining in my internet ads, which are pulling better responses.
Slight shifts in media performance create a migration pattern among marketers, and suddenly the cash flow of one medium is threatened. Have you ever wondered why it takes three page views to navigate on a weather site to find a five-day forecast? Because each page has 15 slots for ads, so three views equals 45 ad placements. When people use iPhones to get weather in one click, all that ad inventory — and cash for the web site, and results for marketers — will go away.
Mobile is coming. Get ready. That BenQ phone is looking mighty fine.