Aside from the guys who post up in a coffee shop for hours with an iMac to play World of Warcraft or stream Game of Thrones in the airport terminal and suck all the bandwidth, free WiFi is great. People can get online for free while on the go, and businesses get folks to hang around longer and spend a few extra bucks on a second coffee or a sandwich. It’s also a way to sell ads.
When people connect to the free WiFi at the more than 7,000 Starbucks-owned locations in the U.S. and Canada, they’re typically shown a static banner on the page to connect. Now Starbucks has partnered with Boingo Wireless—the company that partnered with Google to bring free WiFi to New York subways last year—to expand the number and types of ads shown to users.
Starting Monday, the horizontal banner typically shown on the connection page will be reserved for Starbucks house ads while other brands can run adjoining spots in standard 300 x 250 pixel IAB boxes. Beyond that, brands could run 30-second-long video interstitials after desktop and mobile users connect that they will be able to skip YouTube TrueView-style after 15 seconds and that result in a call to action like a link to a retailer’s sale promotion. If the ad isn’t someone’s cup of tea, they continue on to the Starbucks Digital Network, the portal-esque home page that presents people with articles to read, apps to download, music to listen to and now another IAB-standardized ad.
Boingo Wireless vp of product management-advertising Sebastian Tonkin said that brands will be able to target their ads by location, device (including smartphones and tablets) and day of the week/time of day. For now the location targeting is fairly basic around designated market areas, but Tonkin said the companies are exploring the idea of bundling Starbucks locations into groups like those near business districts in major cities or those near universities. From a technical standpoint, “we can group together locations around advertisers’ needs,” Tonkin said. “The same applies for devices and day of week. A typical iPod Touch user is different than a typical Android user, and people on weekends are different than the 8 a.m. crowd.”
Starbucks could potentially layer in customer data, especially information accessed through users who have registered accounts and make purchases via its mobile apps, to create even more customized targeting parameters or target ads to individuals. But initially that won’t be the case. Ads will also not be targeted by users’ browsing behavior, and no personal information is being collected.
As of this writing, Boingo Wireless had yet to sign brands to buy the ads but was in discussions with potential advertisers in the entertainment and technology industries. The company splits ad revenue with venue partners, but Tonkin wouldn’t comment on how exactly that revenue is being shared, be it on a per-impression or per-action basis or as a fixed percentage.