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Mobile Advertising is an Essential Part of the Marketing Mix

Posted on 8.18.2015

A new study from the Mobile Marketing Association (MMA) suggests that the optimal spend for mobile (based on total campaign spend, not just digital) is between 8-15 percent of an advertising budget.

The data comes from the Smart Mobile Cross Marketing Effectiveness (SMoX) study, which is an examination conducted for The Coca-Cola Company in China earlier this year. The results show that marketers would improve their overall campaign performance without increasing budget by simply raising mobile ad spend. 

"Because we strive to develop the world's most innovative and effective marketing, we knew we had to fully understand and leverage mobile's ability to drive the future growth of our business," said Tom Daly, Group Director, Global Connections, at The Coca-Cola Company. "Based on the results for China, as well as the study we conducted in the U.S., we have begun to see a number of truths about mobile that provide a clear path forward, especially around marketing effectiveness. We now have the facts we needed."

In fact, a closer look at the study’s results reveal that mobile advertising offered nearly double the return on investment (ROI) than TV, and was twice as efficient in driving sales on average. What’s more, mobile at 8 percent of the total budget drives 7 percent of the profit, while mobile at 15 percent drives 16 percent of the profit. Mobile video also emerged as more effective when compared to both TV and digital video, while mobile display was found to drive purchase intent and mobile social was found to drive both purchase intent and engagement.

It is important to note that the study was conducted in combination with Marketing Evolution and Millward Brown Digital to assess the economic value of mobile compared to traditional marketing channels and shed light on the impact of mobile on marketing. Moreover, MMA Global notes that the study’s results are consistent with other SMoX studies that have found mobile to be a key driver of business results across the entire purchasing funnel.

"The market has acknowledged that there is a deep chasm between consumer behavior and what brands are currently spending on mobile, but now there is real, indisputable proof on the value of mobile to a brand's business goals," said Greg Stuart, CEO of the MMA. "We applaud Coke for their leadership and commitment to figuring out the true ROI of their marketing spend and aligning to consumers' dramatic move to mobile for content, community and commerce."

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