Commentary

With an Inherently Local Ad Base, Publishers Can Take the Mobile Lead

March 28, 2012March 29, 2012 by Jeffrey Peden

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Jeffrey Peden is a guest author. If you’d like to submit a guest post, click here.

With mobile advertising experiencing 10-20% growth year-over-year, focus can be the big challenge for most people involved in the mobile space. With expansion is going to come diversification, as increasingly niche long-tail approaches will add depth to a field that till now has been in its infancy.

Mobile advertising is currently largely national or online brands and products—especially with the explosion of ads in games advertising for other games. Local advertising makes up only a small percentage of mobile ad buys, and there’s little sense in this. Yet it’s not going to be local businesses themselves that correct this imbalance—it’s traditional local media publishers who are going to need to lead the local-mobile charge.

Why should publishers promote mobile advertising? First off, it’s a matter of numbers: in order to fill inventory, traditional publishers need to tap into local — it’s one of the single largest untapped sources of mobile ad revenue. Forty-eight percent of publishers expect mobile will soon account for a quarter or more of their traffic, according to the recent Audit Bureau of Circulations Report. That’s a lot of traffic that’s not being fully monetized. But it’s more than just a matter of an untapped market, local advertisers show the strongest likelihood of getting a real return from a mobile ad spend. And yet they’re the ones missing from the party.

The type of advertising that makes the most sense on mobile is local. A not-surprising 95% of smartphone users have searched for local information, according to Google’s 2011 report, “The Mobile Movement: Understanding Smartphone Users.” Mobile users are actively engaged with their devices to access information about local companies, contact that company, and visit their location- all within 24 hours. Furthermore, local display ads, unlike local search, are about awareness—which means a focus on locally-targeted impressions, not direct conversion. This means mobile advertising complements what SMBs are already doing on search.

Publishers are ideally poised to help transform local advertising with increasingly targeted mobile solutions. Most traditional agencies are not going to drive the SMB local/mobile synergy, except for localized campaigns for brands. The average independent restaurant, spa, or boutique merchant is too small potatoes for most agencies, and the solo marketing practitioner often doesn’t have the technical capability or tools to build out full mobile campaigns on their own. Local businesses already recognize the need to follow the eyeballs from traditional media to mobile, but they are looking for partners to facilitate the move.

Publishers are that partner. They already have the relationships with local advertisers. They already are a trusted guide, their publications a reliable channel, and they’ve already bought into the value of mobile. The seminal 2011 Audit Bureau of Circulations report finds that 88% of newspapers and 83% of magazines now distribute content via mobile, a considerable jump from 56% and 42% respectively just two years ago. Most expect considerable jumps in revenue from both mobile content and advertising, as well. Local, geotargeted advertising represents a huge revenue source for publishers: according to BIA/Kelsey’s first forecast of geotargeted social media the local segment of U.S. social media advertising revenues will grow from $400 million in 2010 to $2.3 billion in 2015, representing a compound annual growth rate of 33.3 percent.

They are already there with experience in selling mobile advertising to big brands, a level of experience that will win trust and establishes credibility for the more conservative SMBs.

Newspapers and local lifestyle magazines are in SMBs’ area of comfort. In their print incarnations, they’re many local businesses’ channel of choice. Of all the entities that can lead a mom-and-pop shop or local hotspot, one that may be so new they don’t have a real website, into mobile, it’s their trusted partner in marketing, their local print media outlet.

In this model of where mobile is headed, it’s not about increasing technology with ever-more complex bidding platforms, but about simplifying the process. The enterprise-grade tools agencies need to manage large brand campaigns will always be there, and will continue to reach new levels of power. But for the grassroots advertisers who’ll make up the backbone of the mobile space, these technologies are off-putting and excessive. SMBs are going to need intuitive, transparent ways of getting their messages mobile, often integrated with the email and social platforms they already leverage so well.

What traditional publishers need to do now, they are in a sense already doing. They’re producing the mobile content, trying to move the mobile inventory. The next move is to take their local advertisers by the hand, and offer to be a pro-active guide in the move to mobile, actively advocating for the platform with their loyal base.

Jeffrey Peden is Founder & CEO of CraveLabs, Inc. a Boston-based mobile advertising start-up focused on reinventing local advertising by bridging the gap between local businesses and media publishers. Jeff was previously co-founder and CTO of Newbury Networks, and is an active advisor to several early-stage technology companies, including the TechStars 2012 company BISON.