If banner ads – whose effectiveness even on roomy computer screens is in question – do not translate on mobile screens, how do you even sell an ad?
A complicating factor is that there is no such thing as a single mobile experience: Tablet use and smartphone use are wildly different. A study by AOL and ad agency BBDO last year found that over half of “mobile” activity actually happens at home. While on-the-go activities such as navigating with Google Maps epitomize mobile use, “mobile” can just as easily mean curling up with a tablet to read a magazine article.
“That is two entirely different need states,” said Franke Rodriguez, president of ad agency Anomaly Toronto. “Most brands and marketers are more focused on the on-the-go because they’re trying to make their brands useful … and meet people at the point of need.”
The problem is particularly keen for publishers, which have watched Web traffic from mobile devices skyrocket. USA Today was among the first newspapers to see its mobile traffic surpass online traffic from PCs. This week, the chief digital officer at Gannett Co. Inc., which owns USA Today and a host of newspapers, told an industry journal that mobile advertising is “our biggest challenge.”
“The sole issue that we should all be thinking about is how we are going to monetize as we move into mobile,” David Payne said.
One way content producers can make ads more relevant is by using location-based and other data to better target consumers.
“The real magic bullet will be when somebody can really connect location-based experience with serving up ads,” said Karel Wegert, the vice-president of digital solutions at ad-buying company Media Experts.
Loyalty companies are betting they will be best positioned to make that work. Because they already have a relationship with customers, they can ask for permission to send an offer when they detect a frequent shopper passing near one of their stores, for example.
“Everybody has a price for their data,” said Asif Khan, founder and president of the Location Based Marketing Association in Toronto.
“If you can provide something that is relevant to somebody,
you can use their location
information. They won’t mind.”
Still, the rise of mobile advertising raises abundant privacy concerns. But one industry observer suggests this quandary could be an opportunity to rethink conceptions of mobile advertising and the value of the data it relies on.
In a report this year, Drew McReynolds, a telecom analyst at RBC Dominion Securities, proposed that the industry could set up “a personal information exchange ... [to] pay consumers fair market value for personal information.”
People would get their own digital locker to store the personal information they choose to share. The exchange would pay a percentage back to the locker owners each time it sells their data to a marketer.
“This to me is what cracks the code, as opposed to taking what worked on the laptop or on TV, and translating it on the phone or the tablet,” Mr. McReynolds said.