The advertising and marketing industry have been going through some rapid changes over the last 15 years. The rise of the Internet era has led to a divergence of consumer attention away from traditional forms of media towards more digital forms. While being connected to the Internet via personal computers was a significant shift in and of itself, the increased connectivity that smartphones have enabled is creating an even more dramatic shift as the speed and relevance of ad and marketing campaigns have become increasingly important.

From Traditional to Digital Forms of Media

Back in the summer of 2004 "The Economist magazine published an article describing the changing nature of the advertising and marketing industry, calling the current period “one of the most disorienting periods in its history.” Traditional forms of advertising and marketing are no longer delivering due to the increasing diversity of media and the emergence of new technology, most notably the Internet.

As people spend more of their time going online to shop, be entertained, and seek out a variety of digital information platforms like computers, tablets and mobile phones, the traditional forms of advertising and marketing such as TV and print forms have been displaced. However, these new digital platforms are not entirely equivalent.

In the early days of Internet usage people would sit down at their desktop computer, log-on to the Internet (usually via dial-up), surf for a period of time, and then log-off and continue on with the rest of their life. This logging-on and logging-off is now a thing of the past. Today, people are connected to the Internet at any time and from anywhere, and it is primarily the smartphone that is responsible for this ubiquitous connectivity. (For more, see: Smartphone Revolution: There's an ETF For That.)

The Growing Importance of the Smartphone

Smartphone usage is growing fast as 64%—up from 35% in 2011—of Americans own smartphones, and 19% are relying to some extent on their smartphone for Internet access and staying connected. According to eMarketer, 66.5 billion US local search queries were done last year via smartphones which surpasses, for the first time, searches conducted by desktop computers at 65.6 billion. More and more are turning to the smartphone to complete an increasing variety of tasks.

Such tasks include looking up health information, online banking, looking up real estate listings, obtaining job information, looking up government services, educational research, submiting job applications, and obtaining driving directions. This growing number of smartphone users and the increasing number of reasons for using them are having significant effects on both advertising and marketing.

The Smartphone Affect

This shift towards increasing smartphone usage means that advertisers and marketers will have to shift their strategies and campaigns in a more mobile-centric direction. For instance, companies without a mobile-friendly website risk losing valuable exposure on Google Inc.'s (GOOG) web search queries because Google recently changed its algorithm so that more mobile-friendly websites have priority placement for search queries made on mobile devices.

Another important point for marketers and advertisers is the fact that smartphones are not only receivers but also transmitters of information. Smartphones have become huge repositories of information on individual tastes and preferences. This means advertisers and marketers have the ability to be much more specific in their ad and marketing campaigns, and able to offer more relevant messages to different types of groups or individuals.

While this means that consumers are now expecting this increased relevance from brand advertising, it also means that consumers expect relevance when and where it is needed. Consumers are increasingly consulting their smartphones to help them make every day decisions. For example, 69% of smartphone users look for travel ideas while waiting in a line or for the subway, and 82% of users turn to their phone when deciding whether or not to buy a specific product while standing in the store. In these moments, speed and relevance of advertisement is of utmost importance for brands to make an impression that will influence the decision-making process of potential consumers.

The Bottom Line

Smartphone usage will continue to grow and understanding how and when consumers are using them is crucial for companies’ ad and marketing campaigns. As smartphone data collection and analysis technology becomes more sophisticated, the speed and relevance of ad and marketing campaigns will be significantly more important. If the competing brand can reach consumers with a relevant message at the precise moment when it is needed then they will have made that crucial first impression, and other brands will continually try to play catch up.

Want to learn how to invest?

Get a free 10 week email series that will teach you how to start investing.

Delivered twice a week, straight to your inbox.