Google, Millennial Media executives debate future of mobile advertising

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NEW YORK--Google (NASDAQ:GOOG) is working on ways to enhance how mobile advertisers can track the effectiveness of their mobile ads, even as consumers move between mobile devices and desktop computers, according to a senior Google executive. 

Jason Spero, head of global mobile solutions at Google, speaking here at AllThingsD's D: Dive Into Mobile conference, said Google and other companies that serve mobile ads need to do a better job of tracking how consumers use mobile ads to buy goods in the physical world, where a lot of the value of mobile ads is actually realized.

"Until you can show [that tracking connection], they're not going to pay as much for it," he said.  "We're investing heavily in helping people track the value."

"Fundamentally we need to be able to track that because that's where the value is created," he added.

Spero noted that in February Google overhauled its AdWords platform to reach consumers across all device screens. The revamp was designed not only to increase Google's mobile ad revenue but also to help merchants manage integrated campaigns stretching across multiple connected devices, shaped by contextual factors like location, time of day and device type. Key features include bid adjustments for managing spending across devices, locations and time of day, as well as context-optimized promotions and measurement tools to help marketers compare and contrast interactions on different devices and platforms.

Spero said that in terms of being able to track how mobile ads are performing and how they should be targeted, mobile advertisers should not assume that smartphone or tablet users are on the go. He said people also use tablets in cafes and their smartphones on their couches, which means they are using mobile devices abut are not necessarily walking around. Therefore, he said, Google is focused on "putting some other contexts ahead of form factor." 

AdWords is Google's primary advertising product and its chief source of revenue. Average cost-per-click, which measures the price advertisers pay the company, fell 6 percent year-over-year during the fourth quarter of 2012, following on the heels of double-digit declines during the previous three quarters; analysts have blamed the decline on the shift to mobile, where ad rates still lag behind the desktop.

Mollie Spilman, executive vice president of global sales and marketing at Millennial Media (NYSE:MM), said mobile ad buyers "are asking for specificity" in how their campaigns are targeted. She said that National Geographic launched a campaign that involved launching ads on tablets at the same time a show about Abraham Lincoln was airing.

Spilma said ad buyers are "are allocating more and more of their budgets to mobile" but added that it is still a "new medium. A new medium makes people not want to go in 100 percent."

For more:
- see this AllThingsD article

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