With location-aware smartphones accounting for as much as two-thirds of the mobile device mix, local content is set to make a big push in mobile over the next 12-16 months. The mobile ad ecosystem is maturing quickly, with more advanced environments like private exchanges popping up sooner than expected. Verve Wireless, which has been in the space since 2007, serves up one of the largest local mobile ad networks and offers a mobile publishing platform as well.
Street Fight caught up with the San Diego-based company’s chief marketing officer Greg Hallinan to discuss monetizing local content on mobile and the future of the mobile ad stack.
With geo-targeting, most mobile media now have the ability to serve up a local audience. Where does contextually local content stand vis a vis location targeting in the mobile space?
It’s not just a matter of local targeting – albeit, very important. Local advertising needs to be in a context that is relevant to that particular user whether its through news, information, sports, entertainment – it’s got to be credible.
At the end of the day, it’s still all about audience. If you have the consumers on you’re local site – whether that’s online, mobile, or both – you have the ability to monetize. The challenge with any location targeting, which is not necessarily unique to mobile, is reach. You can location target yourself right out of an audience. Outside of a fun talking point at a cocktail party, the ability to connect to a single user outside of your location is just not relevant. You have to location target at a wide enough radius to capture a meaningful audience. Yet it is sill extremely efficient compared to what you used to have to do.
What trends are you seeing in your network?
As far as trends are concerned, we’ve seen massive quarter over quarter growth, with local volume increasing 400% from Q2 to Q3. The shift in local ad dollars is happening right now. By vertical, services have been at the top for the last couple of quarters. But we’re seeing a shift – automotive (a big player in the national sector), arts and entertainment, health care, and education have all move up in the last few months.
For the most part, the use case for location targeting has centered on bringing nearby consumers into brick-and-mortar locations. Does location matter to national brands that do not have physical locations?
It absolutely matters to them. Traditionally, they operated in a bifurcated advertising world. They had national teams that would focus on the big national reach buys with large rating points and they had local teams that focused on in-market programs. What we’re seeing is the blending of these worlds because they recognize – particularly as it relates to mobile- the ability to move people through that purchasing funnel especially when combined with the other pieces in the media mix. Your sophisticated media brands aren’t buying mobile just as a stand alone. They’re buying mobile as it supports the other more traditional programs/campaigns they’re running.
Think about any Consumer Packaged Goods (CPG) Company. It’s not just about awareness but also heavily about the distribution channel. They pay a lot of money to ensure product facings and endcaps and promotional capabilities at the point of purchase. The ability to drive awareness incentive programs via mobile and then measures that – to be able to say, I know that I drove x number of people around your Walmart store through this promotion –gives them huge leverage back with the distribution channels. They’re all over this.
The challenge with any location targeting, which is not necessarily unique to mobile, is reach. You can location target yourself right out of an audience.
Much is said about the debate between the mobile web and native applications and their potential effect on the future of mobile content distribution. Where does hyperlocal content fit into this discussion?
Mobile web is a must but applications are advisable because of the implied level of commitment. The amount of consumption on the mobile app is anywhere from 8 to 10 times that of mobile web. In general though, a companies mobile strategy should dependent upon reach. Consumers also tend to opt in to location awareness in their applications more than they do with mobile web. But I think a lot of that just has to do with commitment. If you go and download the San Diego NBC application, you are a core consumer of that particular media property versus someone who may be just tapping in and out for certain content.
As far as our network is concerned, the difference between creating an ad product for mobile web and native applications is relatively seamless. We have absolute parity across everything in terms of our products – click-to-map, click-to-call, in-banner video, all of that stuff. Those are the table stakes that are a must in order to compete today. The things we’ve done that are unique to us are to leverage those creative units while adding a level of dynamic content. Whether that’s, taking something like “hey, the lottery has reached this level” and pulling that into the display ad or, to pull proximity to particular retail location. This type of integration is the kind of the next level stuff for interactive local advertising.
Where we’re going is much more immersive through the blending of the ad itself, or the product or the offer being tied into the content. I don’t want to say advertorial but there is a way to create an experience where the is part of the experience through interactive content, stories, or local information. And now, the consumer starts to have a more firmed relationship with the brand because that brand is tied to important things in their community.
How do you scale at that complexity?
I think we have an advantage because we are a publishing platform as well. 1,300 of our media partners are leveraging our tools to distribute that content.
Where do you see the space heading over 12-16 months?
I think the big story will be the rise of the transaction component and the shift from traditional sales organizations to the merchants themselves as well as an increasing ability for those guys to select the offers or deals that are driving ROI because of the transaction capability.
So, self-serve will be big?
With a caveat — it’s who delivers that service that will be interesting. Is it your traditional inside sales teams? I think yes, or at least the smart ones. The smart sales organizations will become more of the marketing consultancies for local businesses in their respective communities rather than selling them on a traditional unit. They will have access to put together almost a mini agency within that local market to provide a number of different tools.
Steven Jacobs is an associate editor at Street Fight.
This interview has been edited for length and clarity.