Mobile to lead ad spend - MXit
Cape Town - The advertising industry recognises that mobile internet represents a growth opportunity, but there are still challenges in the way brands engage with social media, MXit has said.
"I think that we're in a situation where everyone is looking at mobile sites and social media," Juan du Toit, head of marketing and business development at MXit told News24.
According to a kalahari.net Mobile Shopping Survey, 89% of connected South Africans feel that the mobile web is as safe as fixed line internet and 37% have or would spend more than R1 000 shopping online.
Du Toit said that most businesses understood the value of the mobile internet, but were not always sure about how to engage users.
"They're looking at the role that the mobile network operator is playing and I think that most businesses understand that. This thing is big, it's big enough, 'but how do I engage with this?'"
"I think that they're asking themselves the question that I understand that mobile should part of my strategy - any strategy - not necessarily the only piece, but it needs to be there," said Du Toit on the sidelines of the Mobile Media Mindblast conference in Cape Town.
MXit's focus is provide advertising on the platform that allows operators to target marketing to consumers, he said.
"I think that Vodacom and MTN, and maybe to a certain degree Cell C, is educating business South Africa on what is possible, and of course MXit is trying to do that now.
"And that's why we’re bring out our self provisioning system for advertising so that normal guys, if you running an SME or big business, you can actually do self-provisioning on MXit, do your own thing without getting involved in the big MXit machine, in terms of long sales cycles."
In developed markets, traditional advertising in newspapers and magazines is in decline, but Du Toit added that even traditional internet advertising would be under pressure from social media because of the ability to target ads to users and groups.
"The value proposition from Google is clear: They're doing a lot to educate the market, people learned it, they understand it.
"We know that most other media is down, and without being too long-winded, markets are now understanding that the internet is vastly superior in terms of understanding what marketing campaigns do and how effective it is," he said.
"But it's eclipsed by the mobile phone. You can track unique transactions and more than you can do some very clever data mining," he added.
He said that advertisers would have to manage social media marketing to meet the needs of users differently to the way that broad messages were disseminated.
"They are now realising that 'Look I'll have real estate', looks let's call it advertising real estate outside of mobile but 'I need to handle my mobile marketing strategy in a very specific way'.
"Nike realises that you own a piece of real estate on a social media because the thing is: If you want a social community to work, the idea is to give them a human reason to stay within the community - give them a cause.
"They will realise that managing your digital real estate is a very specific job, but it can connect with your offline components," he said.
One strategy brands could employ is to give users engaging content that would result in a sharing of that content and increase brand recognition, Du Toit argued.
"They [brands] stock their digital real estate on MXit with their product information, but also tips and information pieces that is important for the user."
MXit has about 38 million users and while the company has a strong focus on Java, they are watching the development and production of cheaper smartphones in Asia, and Du Toit hinted that the firm was heading into a direction to be a platform that would drive mobile commerce.
"What MXit wants to do over the next few years is change our business model very much to become an application of applications. It sounds like a cliché, but it's a platform where people can load their own service or product or business and communicate within communities in MXit.
"MXit is gearing toward a platform to where we will have classifies, service classifieds; the ability for you to have different profiles where you advertise your bicycle parts to your users."
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