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Mobile's Conundrum

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Many chalk up the early positive results, particularly the click rates, to a novelty factor. "Part of the reason mobile banners worked is the same reason banners work in the early Internet: they were new," said Eric Litman, CEO of Medialets, a specialist in rich mobile ads. "But those numbers dropped quickly."

Litman believes mobile will only convince marketers to make serious commitments if it moves beyond the focus on scale with standardized, run-of-the-mill units. The risk is mobile will follow the same path as the PC Internet and become dominated by direct marketers rather than advertisers used to creating demand via TV ads. "There's only so much you can accomplish ... with a banner," he said.

Mobile ad execs admit there's much to be done to improve the quality of the ads.

The problem, they say, is not everyone has a phone capable of running the type of rich ad experiences brand advertisers want. Even the much-hyped location-based aspects of mobile aren't that pinpointed: most networks target at the DMA level, not down to specific locations. That's unlikely to change in the near term. Apple early this month warned app developers it wouldn't allow them to track user locations unless it was critical to functionality, and ruled out tracking location solely for ad purposes, saying it would disallow apps that did that.

For those reasons, some see mobile advertising as not living up to the hype.
 
"How early is it?" said Scott Shamberg, svp of experience distribution at Critical Mass. "Mobile has been around for a while. People have been saying mobile, mobile, mobile for four years. I'm not a big believer in the click-to-where-I-want-you-to-go model."

See also:

"Importing Mobile Marketing Tools"

"Google Starts Buzzing in Social Media Sphere"

"Mobile Ad Spending Trends Upward"