Problems facing Mobile advertising in Africa

Posted on January 20, 2013 08:40 pm

Just like any form of advertising, there are a variety of factors that affect the cost of mobile advertising business in Africa. I think the purpose of an ad, the target markets, along with supply and demand are typical factors that affect the value of marketing plans. The experience I have is that channels, networks and to an extent the destination of an ad, are more specific to mobile advertising with some channels costing more than others depending on the size and that has been the industry trend in Africa. Another challenge has been the cost of mobile ad depending on the way a marketer chooses to pay for ad clicks and how the advertiser would want to build a brand name. Also, African countries have different type of devices used for mobile advertisements that could be a huge concern when considering effectiveness and cost. The ad network most marketers choose in Africa has been cited as a factor affecting the overall cost of mobile advertising. In some countries I have visited, a network that does not target a market and runs advertisements randomly, is commonly used because its’ the least expensive, but statistics shows that it has not been effective. Lack of exclusive content, high cost of Internet enabled phones have hampered the growth in least developed economies of Sub Saharan Africa. However, not all is lost because a recent report shows that come next year, more than half of phones sold globally will smartphones and Africa is one of the region factored in the report and am sure advertisers, publishers and mobile advertising companies in Africa anticipate higher growth going forward.

Currently, the money spent by the advertiser in some African countries gets channeled between the publisher and the advertising network that places ads on sites. In some countries, publishers command over 60% of the ad value. In some East, Central and Southern African countries, mobile phone users buy products and services regularly on their phones but despite the recent developments, mainstream advertisers have remained wary of allocating more money for mobile advertising with exception of trendsetters like Nigeria, Egypt, Kenya and South Africa.  In other countries like Uganda, Zambia, Tanzania and Namibia advertisers have failed to figure out how effective a mobile Internet campaign is because in most cases advertisers in those countries devote almost nothing of their entire ad budgets for mobile ads according to an industry expert I spoke to. In Kenya, South Africa and Nigeria, there have been several cases where low budgets have been cited as the main reason for low conversion rates for mobile ads where the percentage of users who go beyond just clicking on an advertisement to completing a transaction has remained static.  Another challenge is the lack of innovation in the early days of mobile advertising that date back to mid 2000s when ads were delivered through text messaging in most African countries like Nigeria, Kenya, South Africa and Ghana. Despite the fast changing environment, it still remain the main medium of mobile advertising in almost all African countries. SMS are considered to be intrusive and non-permission centric which has curtailed growth. There has also been a slow adoption of new format of ads that are exclusively suited for mobile browsing because advertisers are struggling to manage the growth of mobile and are grappling in figuring out how to exploit the new frontier of mobile advertisement.

Contador Harrison