Eli Portnoy, CEO of ThinkNear, thinks the reason that mobile ads haven’t taken off is the lack of usable cookies — or the data that they collect — on mobile devices:
Eli Portnoy via TechCrunch
[…] why isn’t the money flowing to mobile?
Advertisers know that the golden ticket to performance is relevance, and by that I mean the ability to target and reach your potential customer base as accurately as possible. I live in Los Angeles, and you are going to have a tough time trying to sell me snow boots in the summer. The more you can target the ads, the more likely you can generate the desired action and the more successful the campaign. The current mobile eco-system allows almost no targeting criteria and demands that advertisers take a spray and pray approach to their campaigns. This leads to poorly performing campaigns and unhappy advertisers that are unwilling to keep pushing more money down the rabbit hole that is mobile.
Why are mobile campaigns so lacking?
The answer most people give is that cookies, which are the mechanism used in the online ad world, don’t work on mobile. Without getting into the technical reasons as to why this is the case, I challenge the argument because even if cookies did work I still don’t think you would see an advertising windfall. Fundamentally, cookie targeting lets advertisers build a profile about your browsing history and retarget you based on that data. However, in mobile the use case is different and this advertising paradigm starts to break. Using myself as a datapoint of one, when I am on a computer I tend to research specific items and create a browsing history that is rich with information and clearly paints a picture of my intents. However, on mobile my browsing and app history is sporadic and incoherent. I pick up my phone when I have time to kill, when I want to look something specific up, or as part of my everyday. Trying to create a profile from this activity would lead to few actionable insights.
So we use our mobile devices differently than desktops — at least at present — and as a result, mobile ads can’t be targeted as well.
But from my perspective the real problem is that advertisers don’t know that it’s me, on my phone, the same person browsing on my desktop ten minutes ago. What’s missing is a unified picture of the person, which could direct an ad to me based on a richer profile.
This space will change soon. Either someone like Foursquare will do it well enough (doubtful), Facebook will own enough piping to target well, or one of the majors will plumb it in directly. The problem with the last one is that Apple has no real incentive to improve ads on iPhone; they make a ton of money now and unless the ad makes the experience better…
And that’s the real thing. The disruptive thing on mobile will be the idea that isn’t an ad, it’s something that helps immediately. Phones are about now and possibly really soon. Help with that, people will pay.