I’ve been very critical of Bluespamming – the indiscriminate blasting of a marketing message to all mobiles in the vicinity who happen to have their Bluetooth switched on, as if that was consenting to the spam. I’ve also been pretty sceptical that it would make it as a stand-alone marketing channel. And while there may be ways of legitimate opt-in Bluetooth marketing, I’m not sure that they ever provide the scale that makes things work.

Of course, many disagreed and set out to prove me wrong on all counts. I’m not aware that anyone has succeeded yet, but I’m always interested to have an update from anyone who has had an outstanding success with the channel or who has a thriving business model somewhere.

One entrepreneur who had a lot of early success was South Africa’s Petros Kondos. Sadly for him, the star which shone brightly at first eventually waned and he closed the business. However, Petros knows that there’s certainly no shame in failure – in the words of the legendary entrepreneur and investor, Vinod Khosla, “I’ve failed more times than I’ve succeeded”. And my own success in mobile marketing was built on the failure of my first foray into the industry with ZagMe.

Petros has written a warts-and-all account of his years as a Bluetooth Marketer. This includes some great case studies of success, but also specifies all the lessons he learned over the years, including what Bluespam is (and isn’t) and why his venture didn’t make it. If you have any interest in this area at all as a marketer or potential entrepreneur, this is a must-read book.

Great entrepreneurs learn from their own experiences for sure. But I think it’s especially admirable when they make those lessons public and share them with the world in the belief that it will save others repeating the same mistakes.

You can get your free PDF of Petros’s book by mailing him pk AT telkomsa DOT net or tweeting him @petros99.

Petros is moving to Toronto shortly, so look him up if you’re in the area. Or better yet, recruit him for your company or startup.

So here’s my attempt at a wooden stake through the heart. I know my stake won’t work. I know entrepreneurs will keep trying it. But this is at least a reference point I can point them to, rather than re-stating the same arguments again and again and again.

By the way, the reason I know this is because I’ve also been sucked in to this kind of thinking. So it’s the voice of experience, rather than my little pet theory.

Just to set the context here, I’m specifically talking about Permission Based Marketing (PBM), though the points may well apply to other models too.

1. You don’t need to

If you think citizens need paying to see advertising, you’re on the wrong track. It’s the wrong way of thinking about the messages you’ll be sending out.

Instead, you need to think about the content in the same way as an editor of an old skool newspaper thinks about her editorial. Will this be of interest to the reader? Will it add value to their lives? Will it be welcomed as part of the ongoing communication? If you can honestly answer “yes” to this, you can send it. if it doesn’t pass this test, don’t. Simple as that.

5 years ago, I wrote a post about what constitutes value and it’s probably worth a look if you’re interested in this area. But the basic point was that adding value was about providing the user with an IDEA – or Information, Deals, Engagement or Advertainment. More detail in the original post or in my White Paper on LBS, which I’ll send you if you email me russell AT mobhappy DOT com.

2. The Consumer Won’t Earn Enough

Once you start crunching through the numbers, no matter how you slice and dice it, it’s hard to find a scenario that earns a person a (very) maximum of $10 a month. Why? Because advertising is about scale. You have to deliver ads in very large volumes to make money or earn money.

Let’s do some basic maths. If you charge the advertiser $50 CPM (by the way – approximately 5 times the going rate) and give say 10% of that to the consumer, that would seem reasonable, right? So, every 1000 ads the consumer sees, earns them $5, which equates to 2000 in a month to earn $10.

Don’t forget we’re talking PBM here, so that’s 2000 messages (think SMS or email) over a month or 66 a day. It’s just not going to work.

Now, people will say. Yes, but this is a new form of marketing. It’s post-advertising advertising. Maybe it is, but with inflated cost you get minimal advertisements to sell, which means the consumer earns less than ever.

Of course, I can’t cover every scenario here. It maybe that providing the value in some other form of currency with a high perceived cost, but low actual cost is possible. But if you heed my first point above, you don’t need to worry about this element at all.

3. Contingent Liability

When you issue your user the right to claim money from you, from an accounting perspective (this may depend on where you’re based), you have to make provision on your balance sheet that you will pay them. Even when it’s perfectly clear (like 5 years later) that you won’t be paying them.

This can create a huge liability for a small business, hogging increasingly large amounts of precious cash.

Of course, there are ways to get round this, like having an expiry date, but this makes it less attractive for the consumer. Back to Point 1 again.

4. The Wrong Users

If you do pay people and they are really doing it to get their grubby little hands on $10 a month, how attractive do you think this audience is going to be to an advertiser? If they really need money that badly, are they going to be able to afford anything that the advertiser wants to sell?

Even if they really are a great audience, you’re going to find it hard to overcome this widely held belief among agencies, especially. It’s just another reason not to try your groovy channel out.

5. The Nick Syndrome

Apologies if you’ve read this little story before.

I had a friend I shall call Nick, because that’s his name. When he gets very drunk and happens to be in a restaurant, he calls the waiter over and asks for 15 eggs and 15 wine glasses. The bemused waiter normally brings them and Nick spends about 20 minutes building a complicated pyramid of eggs and glasses. By this time, most of the restaurant are watching in suspense.

Nick then announces that he’s going to pull the table cloth out and all the eggs will break and fall neatly into their corresponding glasses. The suspense is palpable as it would be truly amazing if he managed to pull this trick off. With much theatre, Nicks grasps the table cloth, (even the kitchen staff are watching now) and with a flourish, he yanks it hard.

Glasses and egg fly everywhere, coating the immediate vicinity in broken glass and yolk. It’s also noticeable that not one egg has broken cleanly into one glass. The restaurant is hushed in shock and Nick stares at the wreckage. He then shakes his head and says, after a 4 second pause:

“It never works….”

Paying consumers doesn’t either.

Happy for a startup out there to prove me wrong and maybe it is possible. But I doubt it.

Most of my time is spent helping people to overcome this tendency, either promoting mobile marketing generically via the MMA, or getting them to test mobile advertising with AdMob. So I think I’ve heard just about every reason in the Book of Excuses that there are.

Some of these objections are more valid than others, some are outdated views on this fast-growing industry and some are frankly a little silly. I thought I’d share some of them with you in an occasional series of posts. If you think you have a damn fine reason why you’re not going to try this mobile advertising malarky any time soon, leave a comment and we’ll look at the evidence for your decision.

The first one we’ll tackle doesn’t really hold up to much scrutiny, but you do hear it being expounded portentously from time to time. It goes something like this:

That mobile advertising might be ok for some brands, but only if the brand is directly relevant to mobile.

This is really like suggesting that you should only advertise on TV if the brand has relevance to TV. It just doesn’t make sense and would mean that leading advertising categories such as FMCG, cars (autos), Financial Services (I could go on) would never run TV campaigns, let alone Press, Outdoor, radio, online and all the rest.

Even if the mobile were completely unique in this “relevance” argument, there’s plenty of actual case study evidence to demonstrate that mobile works pretty damn well, and actually better, than most other media channels on a number of different variables. If nothing else, we can now point to clients spending $1 million+ per campaign (Jaguar and Landrover, for instance), where it would be hard to argue that the brands have much relevance to mobile and yet have still had proven successes in the rigorous testing that has happened so far.

Anyway, that was a fairly easy one wasn’t it? So, dear reader, the brand does not need to be relevant to mobile in order to successfully run a mobile advertising campaign.

It’s simply a Mobile Advertising Myth.