Sultan Khan is Chief Executive and Co-Founder of AdMaxim. Here Khan discusses why the mobile industry is failing to sell mobile's potential as an advertising medium?

On the face of it, the figures from the Internet Advertising Bureau (IAB’s)/PwC’s annual report into mobile ad spend are encouraging: advertising on mobile increased by 157% to £203.2 million last year. It is also good news that sectors such as retail and FMCG have considerably increased their investment in mobile display – retail, for example, was up from 5.5% in 2010 to 12.3% last year.

But before we in the mobile industry clap ourselves too heartily on the back, the fact remains that mobile still only accounts for a fraction of total UK media spend – industry estimates suggest the figure is around 1%.

While the recent surge in mobile spend is good news, given the uncertain economic outlook, it’s worth asking two questions: First, why did it take mobile so long to reach a tipping point where brands accepted that it’s a medium they must get to grips with; second, can we assume that this growth is set to continue, or even increase?

Mobile phones are an indispensable part of consumers’ lives. They’re extremely personal, always with the user, always on. They are also highly interactive, and thanks to soaring penetration rates globally, they offer unparalleled reach. In short, they are advertising manna.

And if the sheer ubiquity of mobile phones is not opportunity enough, the combination of real-time and geo-location-based services mean that mobile’s potential to transform how, where and when advertisers engage with consumers is huge. Powerful analytics software and data-driven optimisation tools enable campaigns to be monitored and adjusted in real-time so brands can maximise revenues. Meanwhile, the arrival of smartphones with the capability to carry high quality rich media advertisements means that brands can now deliver ads that are creatively and interactively engaging.

So why are we as a mobile industry failing so dismally to sell mobile’s potential as an advertising medium?

Fragmentation is one explanation. When an advertising medium is in its infancy, technology providers tend to specialise often because early venture capital support has required them to focus their capabilities. It happened in online, it’s happening again in mobile. The problem is that fragmentation has presented, and is still presenting, a real barrier to entry for brands.

From DSPs, SSPs and exchanges, to optimisation systems or platform-specific rich media formats, the mobile sector is awash with nascent technologies that solve just part of the challenge for brands. Marketers are left trying to make sense of what’s on offer and pulling together a complex patchwork of solutions to create a successful mobile campaign.

Another reason why advertisers are not “getting” or going mobile more quickly, is that despite being a communications business, mobile as a sector is terrible at communicating. Instead of speaking our customers’ language we force them to try and understand ad-tech speak. The digital marketing sector as a whole is guilty of this, but mobile is particularly bad. With all its abbreviations, acronyms and jargon, ad-tech speak only serves to highlight our sector’s complexity, therefore creating a further barrier to entry for our customers.

Brand marketers recognise the potential of mobile, they know it is growing at a phenomenal rate, but they don’t know how to tap into the opportunities it offers. And as a sector, we aren’t helping much. We need to remember that, at the end of the day, we’re just another ad channel. And if we want to take ad spend off other media, it’s crucial that we start speaking the language of brand marketers, agencies and creatives.

That’s what other advertising mediums – our competitors – learned many years ago and do very well now. For mobile it means simplifying the way we talk about mobile as an ad medium and making sure our explanations about its benefits are relevant and compelling.

However, the real future for selling mobile as an ad medium lies in two words: integration and optimisation. Which translated into marketers’ speak mean “convenience” and “delivering ROI”.

So let’s take convenience: By this we really mean having one system that does everything. Brand marketers and agencies don’t want the headache of planning, executing and analysing sophisticated campaigns across multiple ad formats, devices and networks. Ideally they want to integrate all the creative options and formats into a single platform through which they can plan, execute and optimise their mobile campaigns, all in real time.

They also want to have absolute control in real time over what’s happening with their campaign, so they also need to access analysis and reports all in one place. The rise of single mobile advertising platforms (such as AdMaxim’s), that offer brand marketers a one-stop-shop that meets all their advertising requirements, is an important step forward in removing barriers to entry.

Moving on to “delivering ROI”: Mobile offers unprecedented targeting opportunities, but brand marketers and agencies need to know their mobile campaigns are engaging with consumers in a way that is effective and sophisticated, but also relevant. The good news is that by using a combination of sophisticated algorithms, real-time optimisation technology and analytics, marketers and agencies can now monitor a campaign’s performance in real time and divert budget to devices or geographical locations that are performing best, in order to maximise response rates. However, as above, it’s crucial that these optimisation tools are integrated within a single ad platform to facilitate ease of use. It’s even more crucial that, as a sector, we really explain how clever optimisation technology is and how it can help ensure that mobile campaigns are worth the investment of money, time and effort.

One final thought about selling our medium to brand marketers and agencies: we need to get better at engaging the creative community about the creative possibilities that mobile is beginning to offer. This year saw mobile included as a category within The Cannes Lions Awards 2012 for the first time, which is an important step in the right direction. However, rather than leaving it to the ad industry to recognise mobile, we as an industry should be talking to the ad industry about interactivity, rich media and exciting new formats. Mobile offers incredible opportunities for brand marketers and an exciting new canvas for creatives, but mobiles are personal, more so than with any other ad medium. It’s crucial that ads running on them are timely, relevant and appropriate as well as creatively engaging and compelling.

The conversations between the mobile industry, brand marketers, media and creatives cannot begin too soon.