As people spend more and more time on their mobile devices (phones, tablets and phablets), it makes sense that budgets are being shifted in that direction. But there are several challenges with this relatively new medium that most advertisers still have not figured out.

• The creative is not all that effective, usually a banner ad re-sized for the mobile application as opposed to truly thinking about what would capture mobile viewers’ attention.
• The ads are not action driven enough – they are often passive, brand ads.
• It’s difficult, without cookies, to track effectiveness.
• It’s tough to connect mobile ads to in- store purchases because of  tracking issues.
• Targeting is a challenge – the accuracy of the existing tools are unproven.

So when mobile is done well, it’s worth examining. Dunkin’ Donuts ran a campaign about a year ago that can teach us several lessons on how to use mobile wisely.

Its goal was to reach coffee drinkers who did not routinely visit a Dunkin’ Donuts store. They wanted to change their buying behavior and encourage them to visit a Dunkin’ Donuts rather than one of their competitors. 

To generate measurable behaviors, they paired demographic targeting and location information, so they were speaking to the right people at the time they were likely looking for a place to buy coffee.

They targeted coffee drinkers using a third party’s proprietary software that builds behavior profiles based on mobile activity. Then, they geo fenced areas around their competitors’ stores. When one of these consumers crossed into the geo fenced area – they were served up coupons for Dunkin’ Donuts.

To avoid cannibalizing its own customers , the ads were only served up near their competitors’ locations.

The ads were a call to action – a coupon that offered coffee for $1 or $2 for a coffee/meal combo. Consumers could download the coupons for later use. More than a third of the consumers who clicked on the ad took additional actions. They either saved the coupon or searched for the closest Dunkin’ Donuts location. Even more impressive,  3.6 percent of the people who saved the coupons actually redeemed them.

Dunkin’ Donuts is expanding this campaign.

What lessons can we take from its success?

Previous behavior is a great predictor of future behavior: The strategy surrounding your targeting is vital. This is not the tool for a broad branding campaign. People use their smart phones for information and to accelerate action. Your campaign should have that same focus.

Location, location, location: Most mobile campaigns either don’t use this feature or use it poorly. If your ad is too specific or requires immediate action, it might freak out the consumer and feel too “big brotherish.” But you do want to offer them choices that they could either use immediately or save for later.

Create your own measurement tools: One of the reasons this campaign was successful is that they plotted out multiple steps and options for the consumer to take. With each action, they could track the consumer’s responses and ultimately were able to tie it back to a variety of actions, from searching for a store location to making a purchase.

This is an area where both the opportunities and the obstacles are plentiful. We have to learn how to manage the obstacles – because we certainly don’t want to pass on the opportunity!