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Hyperlocal Mobile Ads One Solution to Lackluster Ad Inventory

Enterprise Rent-A-Car is among the first of firms to use Google Mobile Ads' new hyperlocal advertising feature, which gives the distance between the user and the local business.   Called Hyperlocal distance, it only charges advertisers when users click to visit the website or on the phone number shown in the ad.

Google - and presumably Enterprise Rent-A-Car - have come to realize that the mobile ads that work the best are the ones that deliver useful information to users, such as distance or store hours or sales information. Another example is uLocate Communications, which remade its mobile ad network, now called Where Ads, with a focus on hyper local ads. It struggled at the beginning with low quality ads and decided to see whether it could retain more customers by getting location-based ads directly from companies who work directly with local merchants. (via Xconomy).

Click-through rates increased dramatically, allowing uLocate to start selling ads for higher prices. "We contacted a few folks and it turned out that everybody else had the same problem - lousy ad inventory that doesn’t perform well," Dan Gilmartin, uLocate’s vice president of marketing, told Xconomy. Basically, he said, the supply of ad slots in web pages, apps, or games still greatly outstrips the number of ads that advertisers are willing to pay premium prices to place. The result is that too many ad slots are filled by cheap, non-targeted ads that turns viewers off.

Hyperlocal Growth

In general, the local mobile ad category is experiencing huge growth. An update from BIA/Kelsey's U.S. Local Media Forecast indicates total local advertising will reach $2.02 billion in 2014 from $213 million in 2009 - a compound annual growth rate of 56.9%.

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