mmsFor many, 2012 has been the year of hand-wringing over uncertainty about advertising on mobile devices. Whether promoted through in-stream content on social networks, or through banner and interstitial ads in videos or apps — investors, developers, and advertisers alike have struggled to get on the same page as far as the effectiveness and resulting value of these new advertising opportunities created by the shift to mobile.

Mogreet, a Los Angeles mobile marketing platform startup, focuses on one of the less discussed ad channels: lowly MMS (multimedia messaging service), or in other words text messages chock full of rich media. The company released some revealing statistics by way of infographic today, which make the case for giving the decade-old medium a second glance.

The findings come down to two factors: ubiquity and engagement. Specifically, 95 percent of mobile phones in the US are capable of receiving MMS. Of those device-owners, 75 percent regularly use MMS. And the kicker, 95 percent of MMS received are opened and viewed. This means that if a company sends out 1,000 ads, 708 of them are likely to reach their intended audience.

The company compares these numbers to in-app ads, but they stack up well against nearly any mobile channel, where users are notoriously ad-averse. The company points out that only 55 percent of phones support apps (aka, are smartphones), 53 percent of smartphone owners actually use apps, and subsequently 0.812 percent of in-app advertisements are intentionally opened. This boils down to in-app ads reaching only approximately 3 out of 1,000 people.

By this math, MMS ads are 230 times more effective than in-app advertisements.

But how valid are these numbers? The first question comes down to what it means to open an ad in each instance. With an in-app ad, this presumably means to click on a display ad. Such an action, when intentional,  indicates intent to engage with or learn more about the subject of that ad. In the case of MMS, the company is counting “opened messages” which is a bird of a very different feather.

Recipients of MMS are typically shown only the name/number of the sender and a limited preview of the message, meaning they must “open” the message just to see if they wish to engage further – it’s also typically the only way to mark a message as “read.” I’d argue that this type of engagement does not confer the same level of intent as intentionally clicking on an in-app ad.

Further, many consumers accept in-app advertisements as a necessary tradeoff for free-to-use apps which are either entertaining or helpful. Engaging consumers by MMS comes with no such value exchange – even if users include their mobile phone number when filling out a contact form somewhere, and “opt in” to a messaging campaign. Thus such ads have the very real potential for recipients to react as if they were being spammed.

Ignoring for a moment the implications of opening a message, the unsexy MMS ad channel is extremely effective at delivering ad impressions. The other big appeals of the technology are that it’s incredibly cheap – typically $0.01 per message – and platform and carrier agnostic.

Mogreet, which works with major retailers and media companies, including Fox and Bloomingdale’s, is supported in 175 countries and currently reaches more than two billion consumers. Approximately two months ago, the startup released an API allowing third party-developers to easily integrate MMS, SMS, video and in-app messaging into their applications. Mogreet has raised a total of $14 million across four rounds of financing from Black Diamond Ventures, DFJ Frontier, Ascend Venture Group, Bryant Park Ventures, Draper Associates, and Spyglass Ventures.

[Image courtesy Mike Licht, NotionsCapital.com]