Leveraging the power of the smartphone for advertising

    TORONTO, Feb. 23 /CNW/ - There is already a critical mass of smartphones
in use - Blackberry and iPhone to name a few. In fact, according to a recent
PricewaterhouseCoopers (PwC) survey titled, Convergence Monitor: Personal
Mobility, about 85% of 7,400 respondents have one or more mobile phones. These
devices have become intimate possessions of men, women and children and are
rapidly becoming an important way of discovering new information, fashions,
societal trends and making in-the-moment purchasing decisions.
    As such, according to Dr. David Jacobson, Director of Emerging Technology
with PwC in Canada, the smartphone is emerging as the out-of-home advertising
device of choice for the next decade. Broadband Cellular services, already
widespread in Canada connect smartphones ubiquitously and so, in the view of
PwC, will be more dominant in the years ahead than WiFi hotspots.
    While the economy is hitting the entertainment and media space like other
industries, it's been shown in the past that consumers have not cancelled
cellular subscriptions. While people cut back on savings it's usually on
spending on major discretionary items such as automobiles, vacations,
furniture and restaurants. The Personal Mobility study found that the average
monthly cost to respondents was in the US$40-59 range.
    Dr. Jacobson notes, "It is now recognized that successful advertising
means not only capturing an audience's attention but also, and most important,
capturing a person's intention (to buy, to travel, to choose a restaurant).
The intimate nature of the smartphone coupled with its increasingly
high-quality colour display screen is being recognized as a powerful mechanism
for capturing the intentions of the specific user who has made known his/her
interests and preferences. Advertisers might want to reconsider where they are
putting their ad spend - where people are looking and spending."
    Indeed, according to PwC's Global Entertainment and Media Outlook: 2008 -
2012 Canada's Internet and mobile access market is projected to increase at a
10.6% compound annual rate, reaching $5.6 billion in 2012 from $3.4 billion in
2007. Mobile advertising will total $376 million in 2012, rising at a 36.6
percent compound annual rate from $79 million in 2007. This is in contrast to
the numbers for print advertising which in Canada is expected to reach US$2.61
billion in 2012, up only 0.4% on a compound annual basis from US$2.56 billion
in 2007. However, given the current economy, we are seeing a significant
downswing in advertising spending, as advertising reacts very quickly to the
economic cycle because consumer cutbacks hit major advertising categories -
financial services, automobiles, and airlines - the hardest.
    According to the Personal Mobility survey there is some resistance to
both targeted and non-targeted advertising with a mobile device. At the same
time, targeting presents an opportunity for advertisers to refine and polish
their messages to meet the needs of their audience. Attitudes toward
advertising are very closely aligned with age. Younger respondents to the
study were much more open to receiving such advertisements - the younger the
respondent, the more receptive to the practice.
    Tracey Jennings, PwC Canada's leader of the Entertainment and Media
Practice comments, "The biggest movements and highest growth in consumer and
advertising spends will come from those who understand and leverage their
existing consumers and advertisers and take them into the world of new media
enabling consumers to access content on any platform. Indeed we are seeing
many new exciting technologies that allow smartphone users to have a better
viewing experience by projecting the images on to another, larger surface."
    The Personal Mobility survey further found an interesting discrepancy
between what consumers actually use and value and new services they would like
to add. When asked what applications they would like to have in the next six
to twelve months, some respondents suggested refinements that would make life
easier and more enjoyable. These aspirations fall into five broad categories:
work, financial, social networking, travel and entertainment, and security.
    Many respondents requested applications that are available on new
advanced devices. Some service providers already enable playing of DVD files
and offer live TV, video calls, Wi-Fi, music in MP3 or advanced format,
Internet on mobile, anti-theft software, scanning and sending faxes.
    Jennings comments, "This raises several questions: Have their service
providers not yet launched these applications? If the services are available,
are customers aware that these options exist? Is the user experience good? Are
the services priced attractively?"
    For more information visit www.pwc.com/ca/em or
www.pwc.com/convergencemonitor for a copy of the study noted above
"Convergence monitor: Personal mobility."

    PricewaterhouseCoopers (www.pwc.com) provides industry-focused assurance,
tax and advisory services to build public trust and enhance value for its
clients and their stakeholders. More than 155,000 people in 153 countries
across our network share their thinking, experience and solutions to develop
fresh perspectives and practical advice. In Canada, PricewaterhouseCoopers LLP
(www.pwc.com/ca) and its related entities have more than 5,200 partners and
staff in offices across the country.
    "PricewaterhouseCoopers" refers to PricewaterhouseCoopers LLP, an Ontario
limited liability partnership, or, as the context requires, the
PricewaterhouseCoopers global network or other member firms of the network,
each of which is a separate and independent legal entity.

For further information:

For further information: Carolyn Forest, PricewaterhouseCoopers LLP,
(416) 814-5730, carolyn.forest@ca.pwc.com; Nina Godard, PricewaterhouseCoopers
LLP, (416) 941-8383 x 13520, nina.godard@ca.pwc.com

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