Seeing Through the Murkiness of the Mobile Ad Market

March 30, 2012

mobile, mobile market, advertising

 

The mobile market is ripe for advertising. Out of the television, print, web, radio and mobile, people spend 23 percent of their time on mobile devices – second only to television. People who use these devices are perfect for advertisers: many are young people with disposable income who are ready and raring to make purchases from their mobile devices. 

Advertisers have a strategy to reach these mobile users successfully. Despite this, the mobile advertising industry has not taken off like the hardware and software it seeks to inhabit. Only 1% of ad spending is on mobile, according to Flurry. In fact, some media buyers are even cutting back on mobile budgets. Advertisers have all the pieces necessary to construct a money making machine, but it as of right now, it just won’t stick together. What’s the problem?

Consumers love privacy.

Surprised? No? Neither was I. The largest discussions surrounding today’s tech concern privacy – and for good reason. As it turns out, when you know your target intimately, it’s easier to make money.

According to Frank Barbieri, senior vice president of corporate development for YuMe, a video advertising platform company, it’s incredibly hard to target mobile users without using cookies, which he claims are, “treated as heresy in mobile.” Some advertisers must rely on the data users freely give to companies to target a lucrative amount of people successfully, while others create convoluted methods just to get a best guess of who the audience of an ad might be.

One industry trend that may aid in overcoming this problem is a new focus by telecom companies on ad delivery. SingTel, with, “434 million mobile customers in 25 countries,” acquired Amobee, a mobile ad company, early this month. On top of this, says Rich Lefurgy, companies like AT&T have created, “new business units focused on the delivery of digital advertising and mobile payments.”

These telecom companies bring several things to the table: “they can locate a user anytime and anywhere, they have a trusted relationship with their subscribers, and they can enable a closed loop, real world transaction,” Lefurgy says. All of this will help advertisers reach targeted consumers in a way that will best get them to act on the ads they’ve seen.