It is of no great surprise that the team at Spreed believes that location is an extremely large part of the mobile mix. Location targeting can be used for displaying more relevant content to users, but it can also be extremely effective as a form of targeting for advertisers.

Spreed has been on the forefront of location based advertising since the inception of the iPhone and it’s ubiquitous GPS technology. Not only have we developed a content platform that can detect someone’s location and actually re-skin the application based on where that users is (i.e. Metro News in English speaking Canada versus French spreaking Canada), but we have also included to-the-meter targeting of advertising in our CleverAds Ad platform.

We have seen a number of our publishers sell smart location based campaigns to their advertisers partners. Some of the most notorious examples being the targeting of large sports stadiums during professional games with deals for bars and restaurants right outside of the stadium. However, in most part we haven’t seen a large number of these campaigns run.

Mobile Marketer published a good article last week entitled, Have Marketers Forgotten About Geotargeted Mobile Advertising. We do not believe they have forgotten about it, we believe they haven’t even really tried it out yet. We are hoping that 2012 will bring a change in the trial and testing of location based campaigns.

The article by Mobile Marketer references Wilson Kerr, vice president of business development and sales at Unbound Commerce, Boston, who says  that location based campaigns haven’t been sold yet because, “ there is far more mobile ad inventory than ad campaigns booked. Mobile ad networks likely want to broaden the net they cast, rather than narrow it, to maximize impressions rendered.”

Essentially he is implying that mobile ad networks are just trying to fill as much inventory as possible, as we are still in the infancy of mobile advertising, without thinking about the conversions. This is a problem as generalized, untargeted campaigns are not going to translate into high CTR’s and in the infancy of mobile we need to prove campaign can really provide significant benefits over other mediums in order make mobile a permanent and potential dominant part of the advertising mix.

The above reason could be the issue for the lack of location based campaigns. But we would also like to throw in the possibility that the technology in not generally available in order to sell premium location based campaigns. The achilles heal of location based marketing has always been it’s inability to accurately predict a number of available impressions within a specific location.

Most ad platforms give publishers or advertisers the ability to target campaigns to the city or meter level. But very few can actually tell a sales representative how many available impressions they have to sell within any given location. Without understanding what you are selling it is hard to have confidence in your product and even harder for a potential advertising partner to understand what they are buying.

Spreed is proud to be one of the few, if not the only ad platform with the ability to report on trending available inventory within any given location. Because our ad platform is directly integrated into our analytics platform and the application or mobile site, we have significantly more information about a user and can actually use that information when targeting them with advertising. Location is just one example of information that we collect and can then utilize from an advertising perspective.

If location based advertising is going to become popular (and it should be as the conversions could be massive) more technology providers are going to have to provide detailed reporting on available inventory within a location. In the mean time our platform is ready to provide publishers and advertisers with that information.

If you have any questions about location based mobile advertising or location based reporting, to not hesitate to reach out to us via email/phone or leave a comment on this post. In the mean time we highly recommend reading the Mobile Marketer article linked to below.

Have Marketers Forgotten About Geotargeted Mobile Advertising 

Geotargeted mobile advertising is a hot commodity and a great way for marketers to not only drive in-store traffic, but make ads relevant to consumers. Although companies such as Best Buy and Ace Hardware are using location to their advantage, others are not.

Hot off the heels of our last post about Facebook and their impressive CPM and Clickthrough rates is a new article from EMarketer. According to their research, they are finding that contextually relevant ads are seeing significantly higher clickthrough rates in mobile.

This statement seems logical and obvious, however the point needs to be made. Ad sales teams need to think about relevancy in the mobile space. Mobile devices are connected and with you at all times. Context can mean location, but it can also be based on what you are or have read in the past.

It is important to choose advertising technology that will allow you to target users based on the data that you are collecting about them. Mobile has the potential to provide significant returns on your advertising clients investment, but you need to manage them effectively. The only way to do this is to have the capability to offer deep location based, demographic, behavioural and contextual targeting.

To learn more from Emarketer about this study, click below

Contextually Relevant Mobile Ads See Impressive Clickthrough Rates

Contextual advertising has long been a staple of many media plans for brand marketers looking to approximate their target audience through aligning their ads with relevant site content.

Mediapost reported this morning on some very interesting data that Facebook provided at the end of 2011 which has broad implications for digital publishers. At a time when publishers and media hubs are doing everything they can to retain advertising rate, Facebook’s average CPM has increased by 23% over the past year across five of it’s major markets (US, UK, France, Germany and Canada).

In addition the average CTR on Facebook ads has increased 18% during the same time period. The big question publishers need to be asking is how are they able to achieve such fantastic results?

The answer is quite plain and simple, at least for this in the advertising technology space. Firstly advertisers are getting more creative and engaging when it comes to Facebook ad creative. Over the past few years advertisers have been testing different forms of Facebook creative and they finally have found a sweet spot that compels users to engage with the ads instead of ignoring them. Secondly, Facebook has offered a number of highly focused targeting options and advertisers are now beginning to understand these tools and utilize them effectively.

Spreed believe these two strategies are the only ways that publishers and media companies are going to be able to compete with social sites like Facebook and stay relevant in the online advertising space.

At Spreed we work very closely with MoFuse to offer our clients the tools to build rich and engaging advertising units. We see far too many campaigns across the mobile ecosystem that fail from a creative standpoint. The last thing you want to do is link a small banner ad to a flash website on a mobile device; it just won’t work. We encourage publishers and advertisers to create ads that utilize the rich features of the smartphone environment, including location, video, etc in a way that will engage users and provide value to them and the advertiser.

Secondly, Spreed offers a host of targeting options that rival those provided by the Facebook platform. Publishers may not yet have the reach on their mobile sites and apps that Facebook has on the web. However, the tools we provide allow our partners to harness the deep targeting that is made possible by the mobile ecosystem. Spreed’s CleverAds platform allows advertisers to target users by location, behaviour, context and demographic. In order to increase CPM’s like Facebook on a quarter by quarter basis, publishers need to think beyond section sponsorships  and utilize deeper targeting rules. Spreed is well setup to allow publishers to do this.

We see mobile as a mulligan for the industry. This is a chance to get things right where we made mistakes on the web. We can’t afford to drop advertising rates in mobile because we think advertisers won’t pay. We need to think beyond the web and find ways that make mobile even more attractive. Publishers need to pick advertising technology that allows them to offer ads that will increase Click-Throughs and overall CPM rates. Spreed is here to help you navigate this emerging ecosystem, both today and in the future.

For more information on the success of Facebook over the past year, read the media post article below:

Facebook CPMs Rising, Click-Throughs Too

The cost of advertising on Facebook keeps climbing. Average CPM rates increased 8% and cost-per-click (CPC) rates rose 1% in the fourth quarter of 2011, compared to the prior quarter, across five major markets (U.S., U.K., France, Germany and Canada). That’s per TBG Digital on Facebook advertising, based on a total of 326 billion Facebook ad impressions in the year’s final quarter.

It will be no surprise to our readers that at Spreed we believe strongly in the promise of Location Based Advertising (LBA). We have talked about LBA in many of our previous posts and have built powerful  LBA features into our CleverAds mobile advertising platform.

For those unfamiliar with Location Based Advertising it is any form of advertising that targets users in a specific location and provides them with geographically-relevant ads. LBA has been around for quite some time now on the web, but typically targeting users only on the city or neighborhood level. However, with the rise of smart phones and smart phone applications, LBA becomes a lot more interesting. Almost all of the new smart phones possess GPS capabilities. This means that advertisers can now target people down to peoples exact location as they move around their respective cities.

We believe that LBA is going to be huge for the retail industry and we are already starting to see the returns as outlined in some of our previous posts. Although LBA has been around for some time, the companies really pushing this space forward are the Location Based Services (LBS), such as FourSquare and Gowalla. These services let you ‘check-in’ to specific locations and see who else is there and where your friends are. They are also useful for pushing location based deals and incentive programs. Gowalla, launched in 2007 and Foursquare launched in 2009 (according to Wikipedia). In the race to be the dominant service Foursquare is clearly winning –  Techcrunch recently reported that they are 5x larger and are growing 75% faster than Gowalla every day.

Location Based Services are exciting and have been gathering momentum over the past two years.   However we wanted to take this opportunity to point out the pros, cons and where we think they are moving in the next 6-12 months in regards to their potential for Location Based Advertising.

Pros

• These services are great at building brand loyalty. For example, if you are the person who ‘checks-in’ the most on FourSquare at a location, you become the mayor. Some stores offer free incentives to their current mayor. Also, there is a large opportunity to provide discounts to customers who ‘check-in’ a certain number of times. Think of this as an automated loyalty card program (i.e. Subway card).
• They pull nearby users in. For example, Foursquare is beginning to push deals via a banner on the application for specific stores or venues if you ‘check-in’ around their location.
• They let you know who is physically around you. I have been to many concerts and found out after the fact that friends were there. By using one of these LBS’s you can easily ‘check-in’ and find out who else is there (in real time).
• They are great for Word-of-Mouth marketing. Users can add tips to locations. If you login to a location close by to a location where a friend has left a ‘tip’, you receive the WOM advise via a push notification.

Cons

• People value privacy. I have been hearing from a growing number of people that they do not want everyone knowing where they are all the time. I think we are going to see this trend increase as time goes on. People are already worried about their privacy, but Location Based Services just up the ante on open information.
• People are beginning to experience serious ‘check-in fatigue’. Every time you go to a location, you have to manually check-in. If you are only using Foursquare, it still gets tiresome; However, if you are using multiple LBS applications, it becomes out-right annoying.
• There is very little utility for advertisers. Other than the location based deals that pop up every once in a while on Foursquare, there is very little value added to brands by these tools. People can provide you tips when you check in to a location, but there is no call to action, no directions to get to this location and definitely no ‘download a coupon’ option for this location tool.

If LBS apps are going to survive and become successful business ventures, they will need to address these cons. There is an interesting article in  today’s Mobile Marketing Watch about a new LBS app called GroupTabs. GroupTabs is set to launch in a few weeks and is a cross between FourSquare and Groupon. If you do not know about Groupon yet, they push local deals to subscribers daily. Grouptabs plans to push people deals from around their current location as they ‘check-in’. These deals will add a lot of value to the LBS chain and definitely provide utility for both the advertiser and the end user — which solves one of the major problems of the current tools.

The second article that inspired this post is based on ‘check-in fatigue’ and can be found here. In this article Saad Fazil of VenturBeat states that, “Auto checkins can become useful if, for example, I specify Starbucks as one of my favorite spots and am automatically checked in whenever I am there — thus making it easier for the company to offer discounts based on number of checkins.” I wasn’t too sure about auto check-in’s at first as people are already leaving these services because they do not want people to know where they are all the time. However, if you can specify what your favorite stores/locations are and have the tool automatically check you in when you enter the location, those problems cease to become a deterrent.

Now imagine if we mashed up the above two concepts and created an LBS application that allowed you to chose your favorite stores. Whenever you entered the store, you would be pushed a relevant coupon or promotional deal either for the store or for a relevant purchase. This would get rid of the ‘check-in’ fatigue, would in most cases solve users issues around privacy as these are not private location and would supply a great deal of value to the end user. This is the future of Location Based Services and where we would like to see this space going in the future in order to drive the Location Based Advertising Industry.

Only time will tell, but we think GroupTabs is on to a great idea and we whole heartedly support their efforts. If they can adopt the automated check-in system, we think they have  winner. At Spreed we are looking to push location based deals when people open up their newspaper app around one of the papers retail advertiser locations. The pop up would include directions to the location and a coupon for use on their next purchase. As end-users, newspaper publishers and advertisers, what do you think of this opportunity and Location Based Services in general? Let us know!

At Spreed we are strong believers in mobile advertising and we know that the early days of this market are going to be filled with trials and tests. The market is still very young and filled with banner advertising and non-actionable landing pages. The next step is to leverage the unique opportunities made available by mobile devices. These opportunities include actionable banner ads that allow users to download coupons directly into their phone (similar to your physical wallet), call companies directly from their ad or even get directions to a stores location using the phones internal GPS.

Actionable advertising that creates value and provides high levels of emotion are important, but it also needs to be paired with best of breed targeting. The most unique form of targeting on mobile phones is their ability to pinpoint a users exact location no matter where they are. Location based advertising will be a huge success when paired with actionable advertising. Imagine seeing a banner or receiving a popup offering you directions to or coupon for a store that you are extremely close to.

Web based advertising was able to pinpoint you to your city, but this new breed of location based advertising will allow stores to draw a geometric shape around their location and push and advertisement to users that come anywhere within their desired parameters. Given that mobile phone users are constantly moving around their respective cities, this opens up lots of potential for local and more importantly retail advertisers (the bread and butter of newspaper advertising).

In Finland, a recent trial in conjunction with McDonalds and Nokia’s Ovi Maps tool advertised discounts on cheeseburgers when they were close to a McDonalds restaurant. This campaign saw a whopping 7% CTR. Once users clicked into the ad they were presented with the option to download a coupon or get directions to the restaurant. Amongst the users that clicked on the advertisement 39% went on to request even more information and interact with the ad.

These are clearly much higher than the CTRs for standard digital ads on the web. “Location is the new demographic. It’s no longer just about age, gender, and socio-economics, but about reaching mobile users who are in a geographic position to buy,” said Chris Rothey, vice president, NAVTEQ Media Solutions who helped put together this trial. “These findings show the power of LPA in helping advertisers find location-relevant consumers and guide those consumers into stores.”

Spreed believes in both smart mobile targeting and fun and ‘emotion rich’ actionable advertising. Our CleverAds platform is now able to target based on exact locations. Advertisers can draw a line down a street, a circle around a store with a given radius, or any other geometric shape. Contact us or any of our publishing partners if you would like to run a location based trial with your brand.

Even more good news regarding the mobile advertising industry so far in 2010. It seems that all the hype (whether deserved or not) surrounding the iPad has translated into some very early successes for newspapers like Gannett’s USA Today. The Washington Post is reporting that USA Today sold a $50 CPM for its inaugural advertiser on the iPad, Courtyard Marriott. That comes to $0.05 per impression, compared to less than $0.01 per impression for USA Today’s Web site. Such pricing suggests the iPad may prove to be a lucrative new source of revenue for newspaper and magazine publishers.

MediaPost News has a great post on the subject at the link below

‘USA Today’ Gets $50 iPad CPMs

Mobile ad networks have typically charged $10 to $20 CPMs for advertisers looking to reach consumers via ordinary mobile phones. Premium prices range $30 to $40 for mobile video and for particularly desirable cohorts, like iPhone and smartphone owners, super premiums of $50 for popular publications, in the case of USA Today.

WaPo reported that one mobile marketing company, Mobext U.S., said publishers are charging two to four times their typical online rates, — generally under $10.

We need to apologize for the lack of posts in the past month, but as you can tell by the title, things have really been picking up. BuzzCity, a global advertising network that releases a quarterly advertising index, reported that mobile advertising grew by 38% globally in Q1 of 2010. As a personal anecdote, we can  report that Spreed’s clients  have been bombarded in Q1 by advertisers interested in reaching their respective mobile audience.

CEO of BuzzCity, KF Lai, stated that “This double digit growth is also seen beyond the top 20 markets reported on in the study. America saw a 54 percent increase of ads served over the three months in Q1 of 2010,” he said. “This sharp increase in growth, globally and in the U.S., can be attributed to the mobile-centric agencies who are delivering more constant and structured investments in the mobile medium.”

We must note here that these numbers reflect mobile banner advertising and not SMS or mobile search advertising. Banner advertising which is currently the heart and soul of mobile application advertising has traditionally been a fraction of its other two, much more mature siblings.

It is exciting to see the Canadian numbers grow by 68%, considering that Spreed’s headquarters are in Canada and a number of a marquee clients also are run out of the great white north. Canada is still only ranked number 5 in the World for mobile advertising spending. However, this is the first year we have made the top list and all of these figures are proof that mobile is a viable channel. Those media organizations who supported the wait and see strategy in regards to their mobile strategy should definitely take these numbers to heart.

Mobile advertising is still just a fraction of mainstream digital or broadcast advertising. However, page views and overall app and mobile web usage are increasing at a rapid rate. It is important to start on a mobile strategy at some point in 2010 if your organization wants to lock down users and start building up statistics in order to attract these advertisers.

Please see the chart below for exact numbers and rankings.

About a month ago, Apple announced iAds  and when it was first launched there was a lot of speculation as to whether or not it would be the right tool to help media companies monetize their mobile applications. We wrote a blog post on it here stating that it probably was not the best solution for most media companies.

Apple is enforcing a lot of rules around the iAd platform. Firstly, they are controlling all of the inventory. If you want to run a house ad or retain your existing ad sales team to sell your inventory, you are probably out of luck. This would be a major change of strategy for a number of media companies who do indeed use ad networks at times, but usually sell their own advertising and then use networks to fill remnant inventory. Secondly, Apple is taking 40% of all the profits. I cannot think of a single media company that would be willing to give up 40% of all their advertising revenue to Apple.

Today, the Wall Street Journal unearthed some more information about iAds. They found out that Apple will charge upwards of $1 million for certain ad-buys.

To be among a select group of advertisers at launch could cost $10 million or more, the WSJ suggests.  Ad executives say they’re used to paying between $100,000 and $200,000 for similar mobile deals, but Apple is certainly putting a premium price on it’s so-called premium mobile advertising opportunities.

Apple is planning to charge advertisers a penny each time a consumer sees a banner ad, ad executives say.  When a user taps on the banner and the ad pops up, Apple will charge $2.  Under large ad buys, such as the $1 million package, costs would rack up to reach the $1 million mark with the various views and taps combined.

Our question is this, if media companies do not use iAds because it simply doesn’t provide them with the logical solution they need (inability to manage their own inventory and retain significant revenues), how is iAds a premium network? Why would big advertisers opt to spend $10M on a network buy that includes low quality financial apps or even worse fart apps?

I understand that Apple can target based on application category -i.e. Entertainment, but the only applications worth spending big advertising budgets on in that category are the ones developed by big media companies (MTV, CBS, etc). Those companies are using ad platforms that enable them to sell their own ad inventory and don’t take a massive 40% cut, leaving  applications to advertise on that are by no means ‘premium’.

Maybe we are missing something, but there seems to be a disconnect in the logic here. What do you think?