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Verizon's mobile ‘cookies’ could take the cake

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Where's the online action today? Not on desktop or laptop. Users of those devices are leaving in droves, and accessing digital content has moved to smartphones and tablets.

According to just released data from eMarketer, adults in the U.S. now spend nearly 24 percent of their media consumption time on smartphones and/or tablets.

However, marketers are only spending about 10 percent of their ad budgets targeting these mobile devices.

If Verizon comes up with a new marking system -- similar to what advertisers have been able to use to track desktop users -- we could soon be seeing the "cookies" that take the cake.

Verizon wants to fix the problem. Company executives believe they can devise a system to track mobile consumers by assigning unique identifiers to service subscribers. The product under development, called PrecisionID, would allow Verizon to pass these identifiers to advertisers whenever mobile users in its network load websites and apps.

That would allow advertisers to then target messages to those users. In announcing its efforts in the mobile space, Verizon spokesmen say the system would not collect any information for itself and that the identifiers would be anonymous.

Marketers have been wary of allocating too many dollars to digital platforms whose users remain vague to them. On desktop computers, online ad placements are typically tracked using pieces of code on consumers' computers called “cookies.” Unfortunately for marketers, cookies don’t make the transfer to smartphones and tablets. Until advertisers can define whom their ads are reaching and measure the cumulative effect, they're loathe to bet the ranch.

Verizon’s Precision Market Insights team started collecting and selling data on customers last year, as reported by the Wall Street Journal. That information was largely analytic, and was used to provide major attractions like stadiums and shopping malls with statistics and information about cellphone users in defined locations. Verizon is now seeing the serious need to shift focus away from analytics to a system that can target and measure advertising. Verizon currently has 103 million subscribers (per the corporation's first quarter 2014 earnings report).

“We went out and looked at the pain-points in the industry we might be in a position to help solve,” said Colson Hillier, vice president of Verizon’s Precision Market Insights group. “In the mobile space delivering the right ad to right person is difficult because there is no common standard for identity and addressability."

But Hillier is optimistic that Verizon can come to the rescue.

"We think we’re in a position to solve that," Hillier emphasized. "The second piece is the measurement of mobile; there are a lot of problems with getting good attribution data.”

Verizon isn’t the sole concern champing at the bit to capitalize on new targeting technologies. Facebook is now using its user data to help marketers target users across mobile apps. Google, the online ad elephant in the room, is also currently analyzing non-desktop alternatives to cookies.

“We’ve started with mobile because it’s our core," Hillier said. "But if you think of our market position across TV, broadband, and wireless, it allows us to look at behaviors of individuals across different panes of glass.”

For the privacy-minded user, Verizon offers solace. The company says users can opt out of PrecisionID, and that no personally-identifiable information would be passed on to marketers or brands.

“We start with a privacy first mentality. We tread very carefully here,” Mr Hillier emphasized.

All of the parties involved -- Verizon, its tech partners in research and design, and advertisers -- are hoping new tracking systems will be the breakthrough that sweetens mobile advertising and motivates more money in that sphere.

If the gambit fails, they can always mutter, "That's how the cookies crumble." At this point, though, no one is betting on that outcome.

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