Instead of branding, the most valuable ad experience in the mobile space will most likely be a combination of demographic and geo data aimed at inducing a desired action at the moment the ad is shown.
This is all possible by integrating the social sign up (log in via facebook), identifying the location of the person via triangulation, gps or other methods, and remembering their behavioral history. This mixture would allow for highly targeted ads that request an action, such as increasing a sale amount at the checkout lane.
Take for example someone waiting in line to pay at Walmart. The phone can identify the user through the background running walmart app, which knows who the user is, what has he purchased before, what matches his interests, current specials, current store inventory, etc. The union of these variables can be used to determine convinient action ads, which can automatically generate a personal coupon or suggest to the user an item to buy.
Another example would be from a third party app. In this case, the same user at walmart is not running the walmart app in the background. Instead, a user is reading the news via an app like wavii, which both uses facebook login and maintains personal information of the user. That user within the wavii app can also be shown an action ad from walmart, suggesting the purchase of an ideal product match or coupon.
It needs no explanation that an action ad’s impact can be measured almost instantly. This allows marketers a more direct understanding of their ad performance and cost analysis. From an app owner perspective, action ads can serve as higher revenue sources than CPMs or CPC arrangements, given that an action ad can be tied to a commission on the sale.
An Internet of Things
The whole action ad strategy gets even better with the introduction of RFIDs into products. With this “Internet of things”, mobile business becomes the center stage of a large chunk of commerce. In this scenario, a person’s smartphone can identify the products in a household in realtime and keep a history of typically available products. An app can determine when there is a shortage of a product or whether there are special sales on the internet or nearby stores of commonly purchased products. Again, action ads can trigger the purchase of these items, like generating an online order with delivery.
Action Ads can also be beneficial for the travel industry. When arriving to an airport, action ads can display nearby hotel rates for booking, available taxi and drivers (ubercab), individual housing (airbnb), or available dining seats at the hottest restaurants (opentable) targeted to a user’s preference.
BTW: this response was written using a smartphone and the WordPress app after having used the WSJ app to read this article – Riches in Mobile Ads, Just No Profits