Recently I got a call from the Marketing Association team to talk about best practice guidelines for mobile marketing. It was time to refresh the rules around the Unsolicited Emails Act of 2007, which now needs to cover advertising on mobile.
My, how times have changed. The most recent rules (written in 2007) discussed among other things how to navigate the boundaries when sending emails to desktops of people who have not opted in to receiving an advertising message. And just as we got the hang of that, audiences have shifted again. Now, the ability for brands to advertise directly to the very personal smartphone, as opposed to desktop, raises some really interesting questions for marketers.
As marketers and executives in the advertising industry, we all know that smartphone penetration is increasing rapidly in New Zealand. Kiwis are obsessed by these clever little devices that do everything from run your diary, to logging your run, and keeping you up to date with breaking news almost as it happens. In other markets, time spent on mobile is outpacing time spent with television, and it looks like we are heading in the same direction. This means there is a big opportunity looming for marketers to embrace mobile advertising now, as your customers are increasingly spending the majority of their time interacting with their phone or tablet.
What the rules in the Unsolicited Emails Act 2007 didn’t take into account is the new wave of media companies (such as Pandora), which are now delivering many hours of media via mobile devices. The average Pandora listener listens to music via their smartphone for over two hours every day, and more than 20 hours per month. When it comes to serving advertising messages that is a lot of time that could be spent with your brand.
If we look to the US where the digital music landscape is mature, streaming music radio, curated station and track play listening hours grew by nearly 50 percent in 2013. With monetised initiatives, such as ad-funding and subscription, this channels $1.22 billion into the US digital music ecosystem. The vast majority of this music is served one to one on a smartphone, moving from the "broadcast" model of delivering one song to many to what we at Pandora call "unicast". That is, serving personalised music to individual consumers at scale. Advertising is then targeted to each individual listener using their registration data, and also what we can learn about their behaviours.
When listeners sign up to Pandora, they provide us their email address, gender, age and post code. This is a privilege, which we need to take seriously to maintain our relationship with the audience. But because there are no legislative rules in place to dictate the best code of practice, we have had to self-govern by introducing various measures to ensure that we don't betray the trust we have with consumers. For example, always on display within our app is a 'Why Ads?' button, which explains this value exchange, which gives users information on Pandora's advertising policies, with regard to everything from display ads to short videos clickable banners.
From an advertising perspective, in this new world of unicast, we self-govern and live by the ASA and broadcast rules. In the month of August we delivered 1.6 million listening hours in this country. And while there is currently no governance for companies such as Pandora delivering content over smartphones to listeners at scale, we take our responsibility to the consumer and the advertisers seriously. This is an ecosystem where we all need each other, and we need to live up to the implied contract, which is made upon registration. This is probably something that all publishers need to ponder and as an industry we need to begin to discuss.