UK mobile operator O2 said it is seeing traction for mobile marketing, with more than one million customers signing up to the O2 More service in the first year of its launch.

Mobile advertising and marketing unit, O2 Media, was formed last year with the aim of providing personalised media opportunities for brands. Since its launch, over 1,000 campaigns have been deployed, promoting brands including Adidas, Cadbury, Blockbuster, Interflora and Mothercare. The firm claims a 26 per cent response rate to some of its campaigns and has expanded the marketing service to other mechanisms via Top Up Surprises and Priority.

Shaun Gregory, managing director of O2 Media, said: “The fact that over one million of our customers have chosen O2 More speaks volumes about how permission based marketing can address challenges around privacy. We have allowed customers to take full control and create a filter that allows them direct access to the brands they want to hear about.”

But while 2010 still won’t be “the year of mobile advertising,” research from Informa Telecoms & Media notes that the industry is now now seeing increasing examples of successful mobile advertising campaigns and market activity including in-house innovation, partnerships, mergers and acquisitions, leading to accelerated growth of mobile advertising in 2011 and beyond.

Shailendra Pandey, a principal analyst at Informa, said mobile search is growing rapidly with Google seeing 500 per cent growth in mobile search queries from 2008 to 2010. Further, it is estimated that on third of mobile search requests are for local content, which clearly shows that consumers are looking for local information on their mobile phones and highlights the opportunity this presents for delivering relevant mobile ads based on a user’s location.

“From listening and speaking to many industry professionals it seems that the best way to drive the mobile advertising market, at least now and for the next couple of years, is to consider and use mobile advertising as part of integrated (print, TV, online and mobile) advertising campaigns and for driving multi-screen consumer engagement,” Pandey said. “Brands and advertisers now increasingly want to reach to their target audience through multiple devices. A mobile phone is the only device that a consumer carries all the time and therefore it can play a key role in increasing the effectiveness of advertising campaigns by extending the consumer engagement period.”

However, the reality today is that ad agencies at present don’t find the mobile platform attractive enough and operators should consider offering them a higher revenue share, the analyst said.

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