Consumer spend is increasingly shifting toward mobile as 35 percent of millennials claim they currently make purchases on their smartphones, according to a report from Social Lens Research.

The report uncovered massive potential to raise revenue by ramping up the usefulness of mobile ads via customizable content and location-based targeting, especially as 64 percent of survey respondents claimed none of the regular ads they spot are particularly relevant to them. Consumers will be much more likely to interact with or remember a unit that goes beyond the standard banner ad and prompts the user with calls-to-action such as incentives.

“Brands that create customized, localized and rewarding mobile ad experiences will stand out from the competition,” said Julie Diaz-Asper, founding partner and CEO of Social Lens Research, Washington, D.C. “Big opportunities exist to increase the relevancy and usefulness of mobile ads by using smartphone features to customize, increase the entertainment value and localize content.

“Lack of personalization is a big gap for the respondents: 39 percent of respondents felt companies don’t do enough customization (or personalization). There is strong interest in deals, local info: 37 percent are interested in local, close by sale or coupon.”

Shifting spend
Consumers in the millennial demographic are increasingly shifting spend to mobile, with those who make the change buying regularly on their personal devices and spending significant amounts of money.

Thirty-five percent of respondents admitted they purchase items via their smartphones on the regular, while 23 percent prefer to shop via the mobile Web. Conversely, 18 percent find applications an optimal source for purchasing.

This suggests that brands must ensure that all of their sites are mobile-optimized, with easy checkout capabilities. Integrating with mobile payment options such as Apple Pay, Visa Checkout and Google Wallet would also offer one-step checkouts to save time for customers.

Ninety-one percent of mobile commerce users surveyed said they make smartphone purchases monthly, proving that millennials with proven track records of buying in mobile are invaluable target audience.

Many companies also were found to not offer optimal mobile commerce experiences, with respondents claiming only 9 percent of marketers provide a great experience after clicking on an ad.

Offering enticing click-through experiences can help close the gap between those who want to buy on mobile and those that become too frustrated with the shopping process to continue.

Customizable content
The research showed that consumers are demanding more relevant ads to show up on their smartphones, particularly those that increase entertainment value. Nearly a third of survey participants said companies are attempting to squeeze television ads onto smaller screens, while 39 percent believe brands do not offer enough personalization.

More importantly, 44 percent are interested in receiving coupons or deals for products they have been searching for. Gamification may also see resurgence, as 40 percent of millennials claimed they are attracted by fun games that lead to prizes.

“Brands that are targeting mobile first and dominating users have been the first to transition to more actionable mobile experiences,” Ms. Diaz-Asper said. “A good example of that is Amtrak, who is using language and location data to offer target consumers their super saver deals on the MocoSpace platform.

“The Amtrak ads point to a mobile responsive site that uses your preferred language and makes it easy to redeem the deals on your mobile,” she said. “Amtrak drove sales by closing the loop from awareness to action.

“Expect to see more brands make it easy to take action and offer customized deals.”

Ultimately, the value of incentives on mobile cannot be overstated. Integrating loyalty platforms within checkout experience, such as automatically adding reward points to users’ account balances after a transaction is complete, is a tactic that could bring more consumers to smartphone shopping.

“Users clearly want more customized and rewarding brand experiences,” Ms. Diaz-Asper said. “Loyalty programs help you gather information about your consumer that can be used to craft specialized experiences and offers.

“Brands can and should use loyalty programs to build a simpler, more personal and rewarding path to purchase on mobile.”

Final Take
Alex Samuely is an editorial assistant on Mobile Commerce Daily, New York