Google’s Vision for Making Mobile Ads Better

Executive says search giant betting on tablets and mobile Web

SAN FRANCISCO—Jason Spero, Google's head of mobile for the Americas, offered his thoughts Wednesday on the direction of mobile advertising and pointed at where the company is investing for the future.

Spero, who joined Google through its acquisition of mobile advertising startup AdMob, was interviewed on stage at the MobileBeat conference in San Francisco. As mobile traffic and usage grow, he said, Google is making "big bets" in some areas while slowing its investment in others.

For example, he said that Google supports advertising on lower-end feature phones, but it's not spending much to develop technology in that area—less than 5 percent of its mobile ad budget. On the other hand, even though a lot of the excitement right now revolves around smartphone app stores and downloadable apps, Spero said Google believes mobile websites built with HTML5 technology are "going to be the foundation of the visually pleasing ads that we serve."

Google is also making a big investment in ad technology for tablets, Spero said. He acknowledged that there are challenges in adapting mobile ad units to the larger screen of the tablet, but he said that's part of a bigger trend, where "the definition of mobile is changing." In the past, "mobile" meant a specific set of devices, but in the future it will refer to a context. Mobile users are on the go, rather than at a desk at home or in the office. With that in mind, advertisers should think less about designing ad units for a device and more for a specific context—so don't build ads for, say, tablets, but rather for the "lean back entertainment experience."

More broadly, Spero said that improving the quality of advertising is Google's biggest focus across its various platforms, and that it's now in the "execution phase" of the mobile ads business. Does that mean it won't be acquiring any more ad startups? Not necessarily, he said. If the company identifies holes in its strategy, then it will have to make a "make-versus-buy decision." Outside Google itself, Spero predicted that the rapid pace of startup acquisitions will continue.

"If a media company hasn't addressed mobile, they're late now," he said.

He even talked about the competition—namely, Apple. Spero said that Apple's iAd program was valuable for the entire industry "because it made a lot of agency people sit up and take notice." At first, Apple's higher pricing meant that it wasn't competing directly with Google. That's changed now that Apple has lowered its minimum campaign price.

"We do see them closer to our pricing now," Spero said. "There are some benefits to that and there are some competitions."

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