Ready for the Mobile Ad Revolution?

The next revolution in advertising is buzzing in your pocket or purse. Are you ready?

Far surpassing the powers of print, broadcast, and the Web, a host of new technologies is converging on the opportunity to use smartphones to intercept - and influence - the consumer as she walks past a store, wheels through
a supermarket, or reaches toward a product on the shelf.

The technologies include not only the increasingly ubiquitous GPS-equipped smartphone, but also window stickers that broadcast messages, interactive bar codes that instantly link to a website, and increasingly sophisticated databases that track individual activities so they can precisely target products or deals to the consumer.

(GPS, of course, refers to global positioning systems that pinpoint the location of the user, and - after she moves a few feet - the direction in which she is traveling and whether she is walking, on a bicycle, or in a moving vehicle.)

The mobile ad ecosystem admittedly is a work in progress. As the still-evolving infrastructure matures and coheres, however, more advertising is bound to migrate to mobile, because the intimate, personalized, and immediate quality of the platform makes it, by far, the most targetable and effective of all media.

The better the mobile ad infrastructure gets, the less advertisers are likely to spend on traditional media. So, publishers need to pay close attention to this futuristic  marketing frontier, where a number of major competitors already are well ahead of them.

The mobile ad ecosystem starts, of course, with the high-tech Swiss army knife known as the smartphone. About a third of the 240 million mobile handsets in the United States are smartphones, and analysts believe the number will grow sharply in the next few years as cell phone contracts roll over, and carriers compete for new customers by deeply discounting upgraded devices.

At the moment, most mobile advertising consists of little more than banners that, when clicked, link to the sponsor's site or mobile app. While immediate and interactive, the ads are not particularly targeted to the location or interests of the individuals. But that is about to change, big time.

Not the least of the change agents is Google, which at the first of the year began plastering seemingly low-tech stickers in the windows of dozens of businesses in Portland, Ore. But the stickers, which say the business has been "Recommended by Google" and are delivered in a package telling merchants how to advertise on the search engine, are anything but retro. They actually contain low-power radio transmitters that broadcast messages to owners of phones that happen to be equipped with the Android 2.3 Gingerbread operating system.

Thanks to the miracle of what is called Near Field Communications (NFC), the owner of a Gingerbread-powered phone standing in front of a restaurant can read its reviews on Google, visit the establishment's website, check out the daily specials, receive a coupon for half-off appetizers, make a reservation, and book a limo. Using the other functions of the phone, she can invite friends to meet her after work, and alert her Twitter followers to the discount pupus.

Instant connections at the point of purchase are available for those who don't happen to own a Gingerbread phone. The barcodes and quick-recognition (QR) codes that seem to be plastered on everything can be scanned by anyone who adds any of several free apps to her smartphone.

Barcode readers make it possible to check the price of a product in the store - and rapidly search the Web to see what a nearby competitor (or online merchant) is selling it for. QR codes, which are square instead of oblong like barcodes, are turning up everywhere from print advertising to business cards, and could easily be printed on stickers placed in the windows of restaurants. Sites such as BarCodesInc.com instantly generate free custom QR codes like the one on the opposite page. Scan it for a surprise.

For all the value of point-of-purchase promotion, the true power of mobile advertising is its ability to put the right ad in front of the right person in the right place at the right time.

A number of companies great and small are working on products that solicit user preferences, monitor user behavior, and track the physical movement of users via mobile apps to develop breathtakingly rich targeting profiles.

To imagine where this is going, take a look at Livestand, a customized news-reading app being rolled out by Yahoo. Although the stated mission of the iPad app is to help users pinpoint news that interests them, there are distinct and obvious ad-targeting possibilities for the data that will be accumulated through the platform.

While plenty of privacy, technology, and commercial issues remain to be resolved as the mobile ad ecosystem evolves, there can be no doubt that the revolution is under way. And it probably will happen faster than you think.

Alan D. Mutter is a newspaper editor, turned Silicon Valley CEO, turned media consultant. He teaches at the Graduate School of Journalism at the University of California at Berkeley and blogs at Reflections of a Newsosaur (www.newsosaur.blogspot.com).