Imagine you are walking past a Starbucks and on your phone pops up a coupon/advertisement for coffee. I am not sure about you, but my reaction would likely be one of three:
1. "I don't drink coffee" (I know I am in
the minority on this one).
2. "I pay money for my mobile service, why the heck am I getting ads on my phone?"
3."Just because I am near a Starbucks doesn't mean I have time for a coffee."
There is no guarantee of advertisement relevance based simply on proximity. And people's mobile devices are far too personal to risk delivery of annoying ads. Then, of course, there is people's expectation that since they pay for their mobile service, there is no implied contract with providers that they would be willing to accept advertising (in fact people pay for EVERYTHING under current wireless contracts, ironically including the data usage to download advertisements ?). Ahhh, the dream of GPS-targeted advertising on mobile devices: so much promise, and yet so many flaws.
Now let's add Twitter to the equation. Twitter adds two extremely key elements that could make mobile advertising a massive market: context and a free service. The idea that Twitter is a service that I use for free gives Twitter some ability to ask for a small amount of people's attention in exchange for a service that they value. And it really won't be asking much if it can make the advertising it delivers highly relevant.
How can Twitter be so relevant? Because it has an opportunity to determine context for an advertisement. Imagine I send a tweet that includes "it's really hot out here": this can provide context for an advertisement (say for an iced coffee). lf I am tweeting from a GPS-enabled phone, you can now layer on my location to serve me a geographically and contextually relevant advertisement after I complete my text. Additionally, people tell Twitter about themselves, either explicitly through account info or implicitly through all of their tweets, so Twitter can layer on demographic and behavioral targeting (have I ever tweeted about coffee before?).
The marketplace for advertisers could work just like Google AdWords (yet another reason "Why Google Will Buy Twitter...") Advertisers could buy key words or phrases that are tweeted, based on geographic location and potentially a Twitter-user's profile info. So if I was Starbucks, I might buy all Tweets including key words coffee, tiered within 100 feet of a Starbucks location. This does require that GPS location is turned on, but another application that I have been using quite a bit is called Foursquare. It is incredibly addictive to be able to check in with GPS, and a lot easier then manually entering my location on Twitter.
The next question is, how should the marketer pay for delivery of such an advertisement to such a perfect target? Well, I don't want to solve all of Twitter's problems in one column, so what do you think? CPM? Redeemable coupons on mobile devices? Clicks? Drop me a line on Twitter at www.twitter.com/joemarchese and comment below.