Finding location in mobile advertising

LAS VEGAS--Despite growing excitement around location-specific mobile advertising efforts, experts said that for now traction remains negligible, with the emphasis still on experimentation, not implementation. "We're still in the experimental phase in terms of trying to figure out the value of the location component," said Valhalla Partners principal Saj Cherian, speaking on the "Evolution of an Ecosystem: How Technology Influences Marketing" panel held here in conjunction with CTIA Wireless 2010. "The marketplace still needs to figure it out," he explained, adding that individual operating systems and application segments are each taking their own approaches to determining how best to integrate location into the mobile user experience.

The role of mobile advertising as a whole still poses challenges and questions, said Motorola Vice President Ingrid Kelly. "I feel the market is really early," she said. "Developers still don't know what to do, or who to partner" with. Cherian said the size of the addressable subscriber market is now large enough to grab the attention of most advertisers: "It all comes down to ROI," he said. "The number of mobile users is increasing to the point where you can get reach on mobile. Looking forward, the questions are ‘How do I get my reach?' and ‘How much is it going to cost me?'"

MindMatics CEO Kai Buehler said despite its slow start, location is the differentiator that will drive the growth of mobile advertising. "Location-based advertising offers a plethora of new opportunities," he said. "The problem is that retailers haven't embraced it yet." Kelly agreed, noting, "There's a fear in the market that pushing coupons to phones is a little Big Brother-ish. Big brands like McDonald's and Starbucks need to get out there." Another obstacle, according to Cherian: Integrating mobile technology into retail point-of-sale solutions.

Still, the panel remained optimistic that the time for location-based advertising will come. "We live local," said kgb CEO Bruce Stewart. "But from a user experience, it has to be contextual, and you have to welcome it."