A Mobile Misunderstanding
Are there downsides to mobile marketing and m-commerce? Have we learnt from the mistakes of the past? If Facebook is anything to go by we still have a lot to learn
The smart phone has triggered the next stage of the digital revolution and the digital juggernaut continues to gather speed; but has the lesson of the dotcom revolution been learnt or are we making the same mistakes all over again?
The furore surrounding the Facebook IPO appear to suggest that some lessons have not been learnt. The success of the Facebook App and its presence as a standard on many new phones would appear to be another success for the global giant and on one level it has been, cementing their place as the dominant force in social media; but at what cost? Mobile is a far weaker advertising media than the PC resulting in falling advertising revenues as Facebook users choose to interact on the move. A fact that, revealed only after the IPO, caused billions to be wiped off the company’s value whilst the stock of the litigation lawyers rose.
The internet is still a relatively new phenomenon, the dotcom revolution still ongoing despite the ‘bursting of the bubble’ over a decade ago. The feeding frenzy surrounding mobile is not as out of control as it was at the peak of the dotcom boom where self confessed gurus coined phrases like ‘clicks and mortar’, foretold the death of the traditional retailer and told us to ignore all conventional commercial wisdom as they rewrote the ‘business book’, quite literally in some cases.
The point is that mobile offers huge possibilities but the same rules still apply and conventional commercial wisdom still needs to be applied. How many companies have invested in apps without really understanding what commercial benefit they will derive from such a media?
In crude terms Facebooks’ ‘mobile misunderstanding’ was caused by them ignoring a basic display advertising principle, the bigger and more impactful an ad space the greater the cost and therefore the greater the revenue.
Before you get seduced by the ‘sex appeal’ of the mobile app make sure you understand both the benefits and any downside that may exist.