OTTAWA – A perfect storm for mobile advertising in Canada is brewing as a result of growing smartphone penetration and increasing mobile data traffic, said Brian Segal, VP of sales for comScore Inc. at the Canadian Wireless Telecommunication Association’s Wireless Technology Showcase on Tuesday.
“The theory of it is that smartphone penetration will lead to mobile media usage which will lead to increased content, which will lead to increased revenues which will lead to increased content, which will lead to increased usage. We’re going into what we call the perfect storm,” he said during a luncheon session titled, The Canadian Mobile State of the Nation.
“We’re coming into a wave where mobile is going to be at the centre of our all of our minds,” he added. “We’re all coming to this perfect storm where it’s going to lead a tremendous amount of smartphones [being] available in the marketplace in the very near future.”
Currently Canada ranks fourth in the world in terms of smartphone penetration at 36%. The UK tops the list at 44% while the US has a 34% penetration rate of smartphones among wireless subscribers. But while Canada appears headed in the right direction to take advantage of this coming mobile advertising revolution, usage isn’t where it needs to be.
“Canada has the right environment, but still the actual usage is not up to spec in terms of other international countries,” said Segal.
For comScore, the perfect storm is on the horizon and will be the result of a large number of Canadian subscribers that will soon be upgrading their handsets. Canada has a disproportionate number of subscribers who have had their current device for more than two years, meaning they’re coming to the end of their three-year contract and will soon be acquiring a new subsidized handset. When combined with the fact that virtually all new devices purchased are smartphones, the industry is headed for some interesting territory.
“That is going to lead to an inundation of business, and eyeballs on these devices is going to be unmatched so we’re really going to need to get our heads around it,” he explained.
One main reason mobile advertising is going to be big is that smartphone consumers use their device for a variety of tasks: sending and receiving pictures, browsing for news, information, weather, conducting searches, using applications and social networking. A very small percentage of the Canadian mobile subscriber base only uses their phone for voice. Another impact element to recognize is that mobile advertising is an ideal avenue to reach a younger demographic.
And what smartphone users are doing with the device mirrors what they do on their PC. They search for news, entertainment, leisure and other things that relevant to them.
Segal noted that QR codes (quick response or two-dimensional barcode) will play an important role in the future despite its relatively small use currently. About 1.3 million Canadian mobile subscribers have scanned a QR code in the past month. It’s where these codes are being scanned that’s important to recognize: newspapers and magazines, he added. They are largely being used for product and event information, and application downloading.
“What that talks to is the actual fundamentals of marketing. You cannot have siloed marketing anymore, it all has to be aligned,” he said. “If you are going to have QR code, you better have a QR destination that’s going to lead customer satisfaction. Or else you’re never ever going to get them back.”
