Will on Wednesdays: Get Off Your Ads and Mobilize! - Part 3: The Seismic Shifts that Will Need to Take Place to Make TV-to-Mobile Ad/Marketing Experiences Commonplace

By Will Kreth

In our first two articles, we looked at the leaders in the race to connect TV ad impressions to mobile marketing experiences (Apple, Google, Samsung and Amazon). In our third and final installment, we've talked to industry experts on how they see this movie playing out.

The challenges facing all the players in the TV-ad-to-Mobile marketing ecosystem are nothing if not daunting. Various pieces of solutions exist in discrete silos--waiting for changes in point-of-sale infrastructure, evolved user behaviors, multi-screen experience coherence and Connected/Smart TV ubiquity.

That said, in our research on the announcements made and positions staked out by some companies in the mobile payments space over the past few years, it has become evident that classic business school 101 mistakes have been made--early and often--by some of the biggest players around. As engineers who lead companies often do, they've assumed (once again) that the world works like they think--and that solutions in search of a problem (and a user-base) constitute a winning business model.

It hasn't gone well.

Take the area of NFC--Near Field Communication. The many companies behind the push for NFC (from the chips in the phones to the consortiums like ISIS--backed by mobile carriers and a few heavyweights in the credit card industry) have assumed that by leading with a technology first, the concept of "Tap to Pay" with a mobile phone at NFC-compatible point-of-sale (PoS) checkout devices would become a common user behavior. After years of delays (it's now in field trials in Austin and Salt Lake City), ISIS is quite possibly a classic case of putting the cart before the horse. (And it's the opposite of "nerd au courant" Lean Startup methodologies that call upon entrepreneurs to validate their assumptions of market demand with potential customers before building a product.)

"We've been watching the mobile wallet wars for some time, but NFC is not a cure--just a technology," said Alex Campbell, co-founder of Vibes Media, the Chicago-based mobile marketing tech company. "Payments are obviously huge, but they're just part of the mobile wallet opportunity. Apple wisely realized that the market for NFC wasn't ready yet, so they went after simply organizing the mobile wallet [with Passbook] as a starting point. By clustering loyalty reward cards, boarding passes, concert and movie tickets in one place--all these things have started to warm up users to the necessity of mobile wallets."

In a recent interview with All Things D, Google has stated that they too now see the value in building out the non-payment elements of the mobile wallet, before NFC payments can take off.

This makes a lot of sense. As we mentioned before, when driving a tech adoption curve upwards (that is, mobile wallet usage) you cannot lead with end-game tech solutions that declare victory on day one. There's always a logical sequence of events that must be followed to shift the user behavior story. Such as: offering up dead-easy consumer convenience on things they already use, and value-added utility for business partners, early in the game--a well-documented playbook move written by marketers, not engineers.

"The thing about the mobile wallet that's different," Campbell added, "is that you can refresh/update it on the fly. It's like having a paper coupon that updates itself automatically. Plus, it's got access to GPS and iBeacon (powered by BLE – Bluetooth Low-Energy transmitters) for geo-fenced and in-store offers. It can programmatically deliver dynamic pricing based on geographic variables (i.e. bigger discounts for folks who live farther away). In our client campaigns, 95% of the [mobile coupon] redemptions are in brick and mortar retail. For products that are simple decisions (e.g. shampoo), these kinds of decisions are easy. From Wish Lists to "Add to Cart"--the mobile wallet can remind you that it's there."

And speaking of brick-and-mortar, for every future-forward Starbucks and Home Depot/PayPal hookup that have embraced the idea of the mobile wallet, there are nearly 150,000 convenience and gas station stores in the US that are being courted--and in some cases rebuffing--the mobile wallet providers. These quick-serve retailers far outnumber supermarkets and drug stores across the country--by nearly 5 to 1. Futurist Michael Rogers spent some time recently with the National Convenience Store Association, hearing their concerns about the cost structure that a mobile wallet future might bring, and they're not convinced the answer is easy. "These are people who are sensitive to a 1/10 of a cent on a transaction," said Rogers.

From their existing legal challenges over the cost of swipe fees by the credit and debit card exchanges, to setting their own technology roadmap via their research and standards body, Petroleum Convenience Alliance For Technology Standards (PCATS), Rogers believes that the convenience store owners of NACS are a very tough audience that may hold more cards to the mobile wallet's brick-and-mortar retail success than the Walgreens and Targets of the world.

Long-time interactive TV veteran Jody Stark has seen the battles at the frontlines for making TV-to-mobile commerce possible from his tenure at Delivery Agent, and for him it's all about convenience. "Every single additional step [click-throughs, personal data entry fields, etc.] that a viewer has to take to connect their TV experience with a retail transaction opportunity knocks out 50% of your audience, or more. Four steps in, you've lost them. That's why Apple licensed something like "One Click" from Amazon: you have to make it dead easy." It's a UX taboo that another futurist, Paul Saffo, calls: "The Threshold of Indignation"--once you force a user to cross it, it's basically over.

With regards to the embrace of CE makers in the Connected TV space of Mobile Wallet interactions, Stark says to "keep an eye on Roku, Samsung, LG, Xbox--they're all on the path, with millions of Connected TV devices either already in homes or headed to US shores soon; and most of the CE makers are embracing the idea of chipset- and software-upgradeable LCD displays, so customers will be able to have some level of "future-proof" security when moving up to Connected/Smart TVs."

As always, clues abound in the data: "As you bring in more data, the scale of TV advertising will be under more scrutiny for efficacy, more pressure to find incremental revenue," said Vibe Media's Campbell. "The mobile industry is constantly asking (and  measuring) what works, what doesn't, and why. If I was a TV exec, I would look for where the most effective place is to put the Call To Action (CTA)--TV shows could use Passbook to remind people to about their second-screen and game content. There's definitely a huge opportunity for TV advertisers to work with the Mobile Wallet companies. Whether it's cars or insurance--the question is not if, but when?"


Will Kreth is a multi-screen interactive media strategist based in NYC, working at the crossroads of Connected TVs and Mobile experiences that are powered by innovative brands and digital storytelling.  You can reach him on LinkedIn or Twitter.



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