The findings are based on a study of over 22,000 mobile users, carried out in the last quarter of 2007. The results of the report indicate that:

• The number of consumers who remembered seeing mobile ads has increased 38% between the 2nd and 4th quarters of 2007.
• Teenagers are far more likely to recall mobile ads. Asians and African Americans are more likely to recall these ads.
• SMS text messaging is the most popular form of ad response, and was used by 26% of the users, while click-to-call was used by 9% of people.
• 32% of those studied sid they were willing to accept mobile advertising if it could lower their mobile bills, 13% would accept mobile advertising if it improved the media content available amd 14% were open to mobile advertising if it would be relevant to them.
• 23% of users expect that mobile advertising will increase in the near future.

While advertisers continue to look for ways to connect with users through their mobile devices, the quest for acceptable mobile advertising is not complete. Only 10% of the users surveyed found mobile advertising acceptable.

As of now there is no consistent yardstick to measure the performance of mobile ads and this leads to advertisers feeling as if they were fumbling in the dark. Google, Microsoft and Yahoo! have launched a number of services for mobile and programs to enable marketers to place ads on mobiles. This can only mean that the mobile ad market is set to take off in a very big way and a lot of money is at stake here.

Read the full press release from Nielsen

The results of the “Wave 8″ market survey by Advertiser Perceptions bring a mixture of good and bad news for the mobile advertising industry. About 55 percent of marketers plan to increase their budgets on mobile spending in the next 6 months, indicating that there is a healthy level of enthusiasm in the market.

However, less than half the participants in the survey, consider ‘interactivity’, which is a strength of mobile advertising, to be an important criterion when deciding their budgets for advertising. On the other hand, these advertisers consider ‘reach’, which is a weak point of mobile advertising, to be the number one criteria.

Mobile Internet usage needs to increase and attain levels comparable to other forms of media before platforms and publishers can expect advertisers to invest substantial sums in this medium. Among other things, mobile companies will have to facilitate cross-operator inventory, and a consistent audience measurement system to lure advertisers.

Growth Predictions

Analysts and industry leaders seem unabashed about their enthusiasm for the future of mobile advertising. Sterling Market Intelligence forecast mobile advertising revenues will reach $5.08 billion in North America and Western Europe by 2012. Thomson Financial predict Google’s 2009 mobile ad revenue alone will reach $21.31 billion. Gartner predict that the worldwide mobile advertising market will grow from $895 million in 2007 to $14.6 billion in 2011, while the Kelsey Group forecast that the US mobile ad market will grow from $33.2 million to $1.4 billion in 2012. Forrester are the most conservative, predicting less than $1 billion in mobile ad revenue by 2012.

In brief the results of the Wave 8 report show

• 70% of mobile advertisers use text messaging
• 31% of advertisers use video ads
• 36% of mobile marketers use mobile search
• 45% say they intend to start mobile search in the next 6 months

Google’s Optimism

According to eMarketer there are 405 million mobile internet users and the figure is likely to double in just about 4 years. This huge potential market and its steady growth is what fuels Google’s continuing desire to rule the mobile ad space. They are obviously relying heavily on mobile to drive a chunk of their future growth. This would explain why Google CEO Eric Schmidt dismissed Forrester‘s conservative predictions for the mobile ad market and said “(The mobile Web) is the recreation of the Internet, it’s the recreation of the PC story and it is before us — and it is very likely it will happen in the next year.”

However most of these users (18.1 million) still use only 411 services or text messages (14.1 million) for their requirements. Only an estimated 9 million users carried out WAP-based searches from their mobile devices, which makes this a smaller group than even the numbers using carrier search boxes (9.4 million) and searches on the carrier portal (12.4 million).

When comparing usage by frequency, SMS-based searches seem to be most frequently used (12.1 per month), followed by WAP (7.8), carrier portal (6.9), carrier search box (6.5) and 411 calls seem to be least frequent, with just 3 instance on average per month. This could be explained by a greater awareness of 411 services among mobile users.

Data about mobile users in this report shows that roughly 61 percent of 411 users are female, while about 60 percent of WAP users are male. SMS searches are used mainly by those under 25 years of age, probably due to the normal proclivity of this age group to use SMS to communicate.

Local listings are still the leading category (27.1 million) searched for. According to the report, only about 14.8 million people looked for details about sports, weather, news etc. whereas about a quarter of them searched for mobile content.

Can Nielsen’s Numbers Be Trusted?

Unfortunately, no!

The figures quoted above were built up based on a survey of 5,793 users. The responses on the survey were then extrapolated to build up estimated total numbers. This works in many cases, but for this particular survey, Nielsen’s sample user base must have been skewed, because the numbers paint a rather improbable picture.

Google Mobile Search accounts for approximately 51 percent of all searches on mobile devices. On their portal, only 4 percent of queries are classified as local.

According to the Nielsen Mobile’s survey results, 27.1 million out of the total 46.1 million users, that is over 50 percent of mobile users carried out local search queries.

Therefore, in order for Nielsen’s extrapolation to be true, the number of local queries on non-Google mobile searches would need to be extraordinarily high – over 80 percent of searches – which is absolutely unlikely.

iPhone Influences Mobile Search

Only about 45 million of the U.S.’s 208 million wireless users accessed the major search engines, Google or Yahoo! for their information needs. Even the hype and excitement created by Apple’s iPhone and its descendants had enticed only 16 percent of mobile users to access the Internet through their handsets, upto November 2007.

However, the New York Times reported that the number of searches on Google originating from iPhones in December rose significantly, to make it the most popular mobile phone accessing their site. If nothing else, the iPhone could herald a change in mobile Internet usage.

The good news is that a separate survey of over 500 male consumers aged 18-35 years carried out over a period of 4 weeks found that brand awareness can be increased over 30 per cent through banner ads on mobile web portals.

Nielsen’s global survey found that the vast majority of consumers trusted recommendations from other consumers most all. This was followed by trust in newspaper advertising, consumer opinions posted online, brand websites and television. Text ads on mobile phones were trusted by only 18 per cent of users, ranking it lowest, below online banner ads and search engine ads.

To What Extent Consumers Trust Forms of Advertising
Source: The Nielsen Company

Press Release for Nielsen’s Global Ad Survey

Millward Brown and Aerodeon conducted the brand awareness survey in August. Conducted using mobile phone survey technology, the research measured how much ad awareness and brand consideration was generated for a global male grooming brand by a banner ad creative, produced by Aerodeon, on a UK mobile web portal.

Aerodeon’s research showed that branded ad awareness increased by more than 30 percent. Future purchase consideration also increased by 23 percent among users of the brand and 11% among non users.

While this is a mixed bag of news, one thing is clear: Mobile advertising is currently enjoying a honeymoon period where users are responding to ads at a much higher rate than they do on other media (compare 30% to 7% for regular Internet ads). For advertisers, this means that now might be the best time to start building mobile sites and advertising mobile content.

Alternatively, users can text the airline name, and Google will send a text message with the main numbers one can call for information.

In their ongoing endeavour to organise the world’s information, this is yet another handy service being offered by Google. They already offer parcel tracking, vehicle identification number search and many other similar services. The question, though, remains – how many people will actually use these services? When an individual is in a rush, Google might not be the first thing that pops up in their mind when they want information about their flight.

Over time, though, this trend could change. Their continuous innovation is making Google the main online destination for more and more people. As these users discover additional services Google offers, they are more and more likely to keep returning to Google every time they need to find an answer to something. Visitors will also start experimenting over time, trying to search for information that Google doesn’t already provide – which will, of course, be a great way for Google to gauge what else to develop!