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Why it pays to advertise on the move in Africa

October 31, 2012 • Features

The pace of mobile phone penetration within Africa, the increased adoption of Smartphones and use of mobile data are just some of the key drivers behind growth within the mobile advertising and publishing space.

Mobile advertising in Africa is growing. (Image: Flickr/futureatlas.com)

Amid high-growth and a strong move towards Rich Media Mobile Advertising, brand ambassadors and marketing gurus are paying far more attention to the mobile channel as a means of engaging consumers.

Industry analysts believe there is an increase in awareness amongst advertisers to exploit mobile platforms such as feature phones, smartphones and tablets.

Increasing levels of activity within mobile advertising is beginning to show in the numbers, as well as forecasts about the industry.

The continent is said to have had a mobile penetration rate of 65% in the middle of this year and mobile is considered the most widespread tool of communication.

Senior analyst for Informa Telecoms & Media in South Africa, Thecla Mbongue says the mobile ads industry will generate $136 million in Africa in 2012 – the largest share (over 40%) will come from SMS ads.

“In terms of number of users it is more difficult to quantify because we often do not often have access to the number of mobile phone numbers targeted in ad campaigns. We can, however, quantify the addressable market as we forecast over 262 million SMS users in Africa end-2012 and 71 million mobile Internet users (over handsets only), up from respectively 218 million and 46 million in 2011,”  says Mbongue.

Nations within the BRICS community are responding to this surge in consumer interest and technology adoption. According to a media release issued by Gartner entitled Top Predictions for IT organisations by year-end 2014, three of the top five mobile handset vendors will be Chinese.

The release mentions that the openness of Android creates new markets for OEMs that previously did not have the necessary software expertise and engineering capabilities.

With this expectation it is not surprising that there are so many operators looking to capture market share.

Research by inner-active.com has provided an overview of the mobile monetization global landscape.

Clearly there are a host of stakeholders involved with- and actively contributing to the mobile advertising space, including operators within in-app payments, search engines, advertising agencies, advertising networks, exchanges and virtual currency, amongst others.

Publishers and marketers have copped on to the fact that there is a real return on investment in mobile advertising.

Industry specialists put this down to the pervasive, immediate nature of mobile communication, the fact that it can be targeted to specific audiences at specific times and results can be measured.

“Short Message Service is still effective in Africa, however it is intrusive. Mobile Advertising is highly effective, especially since it can be highly targeted. As mentioned, in South Africa Rich Media Mobile advertising is taking off and is even more effective since it is so interactive and immersive.  The best way to measure effectiveness is to set goals…these goals may just be a click on a banner, but it may be completing a form, subscribing, downloading an App, purchasing something or watching a video,” explains Daryn Smith, an independent industry expert.

Smith says there are solutions that add value by tracking the precise progress of communication and then measuring the response.

However, as Mbongue explains, perspective is required when discussing the influence of mobile within advertising.

Rich Media is an example. In terms of the use of video-based advertising, she does not believe this specific segment is hugely significant at the moment.

“This is because, despite the growth of smartphones, most of the devices in use on the continent may not be compatible to play the videos. At the same time, the user experience can be bad if browsing the video is not done on a 3G network. Lastly, if browsing the video is at the subscriber’s cost, he/she might think twice before downloading a video they did not necessarily request to view. At present, the most efficient bearer would be SMS, however there could be some concerns about spamming the subscriber. In most cases, the SMS ad is incorporated in some other messages, such “please call me” services, or included in a price plan or a service and the subscribers would have the choice to opt in or out,” Mbongue adds.

Whilst there is growth in the industry, analysts suggest that the market is still voice-driven in Africa and it will be some time before new revenue streams are sourced.

Chris Tredger, Online Editor

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