“Reach your customers anytime and anywhere”
—Impact Mobile

Few mobile users realize that their communications and actions are monitored and recorded for marketing purposes. Indeed, mobile subscribers are often too busy using their phones and PDAs to concern themselves much with the privacy implications of the mobile platform. But AdMob’s approach to Apple’s iPhone is typical of industry’s opportunistic stance in this regard. “People take their mobile phones with them on-the-go,” explains the AdMob website, “and our iPhone ad unit leverages dynamic maps, allowing customers to enter their zip code within the ad unit itself to find your locations nearest them. Convert clicks to in-store sales.” That kind of service comes with a hidden cost, however, and as with so many mobile marketing applications, the flipside of convenience is surveillance. AdMob admits as much in its promise to “Capture Personal Information: Collect lead generation information directly from your target audience. Let a mobile subscriber provide registration information or other details directly from your ad.”^[143]

Such data mining efforts are not limited to mobile transactions alone, moreover, with companies such as Wmode, a mobile content distributor, integrating such technologies as NetInsight to “[m]onitor usage of loyalty cards and personal offer codes to connect the dots across online and offline channels… and [c]apture conversions and revenues across online and offline channels.”^[144] Ringleader Digital, similarly, explains that “[a]s mobile browsing, search and other behavioral components are tracked and a history is built up, we can begin to integrate that data with zip code, context and perhaps publisher level data profiles. The granularity of targeting will be an evolution that comes together over time.”^[145]

Nielsen Mobile, with its P$YCLE application, its Marketing Customer Information Files (MCIF), and extensive marketing databases, is among the leaders in bringing online and offline data together. “When you append P$YCLE codes to your MCIF or any other marketing database,” the company explains to prospective clients,

you can pinpoint targets who have the resources and propensity to purchase specific financial products and services.

• P$YCLE links your segments to the outside world with links to actionable third-party data—Nielsen Claritas has combined the power of P$YCLE segmentation with up-to-date consumer data from Equifax, Experian, and Acxiom. Our partnership with all three of the major consumer-database companies means that you can get P$YCLE codes where you already get your household-level data.^[146]

Since many mobile devices do not yet support Web-like tracking cookies, it can be difficult to gather consumer behavior for marketing analysis and segmentation. However, mobile applications are being designed to compensate for this deficit. As Steven Feldman, the marketing vice president of Cielo Group, points out to marketers, Cielo’s “branded application comes to the rescue, essentially serving as that tracking ‘cookie’” that mobile marketing lacks. “Within the application, brands can follow consumers’ activity—where they visit and what content they view. Marketers can also ask profiling and survey questions over time in order to gain information for segmentation and targeting. All the while, your ongoing dialogue with consumers serves to strengthen the relationship.”^[147]

Impact Mobile, a mobile advertising agency, is also involved in the current push by marketers to promote mobile data mining. Its JumpTXT Media Platform enables “companies and partner agencies to implement time-sensitive, personally relevant customer retention and acquisition campaigns.” This platform provides a range of user analytic and data mining tools that mobile websites can use to commodify their audiences. For example, registration for a mobile community using the platform is

based around one page of questions that the member has to fill out. Here the most important data such as name, post code, email, mobile number and high-level interests are entered. Following the activation, the member is encouraged to further profile himself. For example, if an interest in Music was initially given, the member can choose from a wide range of music categories to specify his interest in more detail. And because it is a mobile application, the company stresses that advertisers “can reach your customers anytime and anywhere, create a brand new dialogue and obtain real-time tracking and reporting information.”^[148]

Mobile data mining practices are constantly improving as companies devise new ways to extract greater quantities of more precise personal data from consumers. Google is one of the companies most energetically pushing the envelope and actively encouraging the adoption of tracking cookies on mobile devices. Through its mobile operations, “Google provides mobile conversion tracking on phones that support cookies. Google can measure clicks, impression and conversions for all campaigns.”^[149] In addition, the company will use the introduction of its much-anticipated mobile operating system and software platform, Android, to fundamentally reorient the mobile landscape in favor of mobile cookies. According to a company website, Google is planning on incorporating a variety of cookies into the Android platform.^[150] Although it isn’t yet clear what these cookies will do, there are at least a dozen cookies included in the programming specifications.

Google and its Android platform, in fact, provide an excellent example of how a large and powerful company can shape the practices, capabilities, and core architecture of the emerging mobile system. Within the last year there has been a troubling degree of consolidation in the mobile industry among media, advertising, and technology companies. The result of this consolidation is not only the concentration of power in fewer hands, but also (2) an increased ability of these companies to use collections of user data to violate consumer privacy; (3) the integration of existing technologies to synthesize newer, more invasive targeting practices; and (4) as Google illustrates, monopolistic organizations capable of altering the DNA of the mobile marketing environment to suit their own ends.

These trends in mobile advertising aren’t an isolated American phenomenon, either. Speaking at the Mobile Marketing Forum meeting in June, Stephen Oman, global program director for the UK mobile data personalization company ChangingWorlds, commented on the importance of behavioral targeting to the future of mobile marketing. Mr. Oman stated that “advertising is another form of content that must be highly personalized over mobile and not just using basic demographic profiling. Highly targeted and relevant mobile adverts, far beyond the level achieved in traditional methods of advertising, must be realized.” He went on to comment on the importance of data mining in these campaigns, stressing that “in-depth subscriber intelligence which implicitly or automatically learns about the interests and content preferences of individual subscribers is absolutely essential for the mobile environment where a very personal device must offer only information and advertising that is strictly related to personal interests.”^[151]

The actions and intentions of a European company would be of little interest to U.S. regulators were it not for the fact that the company in question has brought its expertise and technology to bear on American consumers, too. In January 2008 ChangingWorlds did just this when it launched its ClixSmart Ad Personalizer for the U.S. mobile market.^[152] With its Ad Personalizer, the company “has extended its unique and patented blend of personalization and unrivalled subscriber intelligence capabilities to mobile advertising.”^[153] On its website ChangingWorlds claims that its “personalized mobile advertising solution is a unique solution to deliver truly targeted and highly personalized mobile adverts that will ensure mobile operators keep both subscribers and advertisers happy.” It advises potential clients that achieving “true personalization of mobile advertising where adverts are highly relevant, attention grabbing and will illicit [sic] a response that can be measured, requires very sophisticated and PURE subscriber intelligence.”^[154]

In addition to its Ad Personalizer, ClixSmart’s Campaign Manager “captures detailed business intelligence information based on actual user behaviour” and “enables mobile operators to rapidly launch branded mobile marketing campaigns, which can be targeted at individual subscribers….” Meanwhile, the ClixSmart Recommender is touted as being “unrivalled in its ability to implicitly build user community preference information which implicitly links a subscriber’s interests to the interests of other similar subscribers and then to relevant content.” “Both individual and community subscriber intelligence is used to automatically generate personalized content recommendations based on a user’s preferences as captured by their mobile portal use and also by leveraging community business intelligence to generate community based recommendations.”

As ChangingWorlds explains,

at the core of the ClixSmart platform is a business intelligence and personalization engine that is capable of capturing unrivalled subscriber intelligence by automatically monitoring the implicit behaviour of users online in order to learn rich preference information and by combining this information with external sources of complimentary data, from demographic details to billing data…. The ClixSmart platform has used its behavioural profiling techniques to record approximately 50 million mobile subscriber intelligence, providing its mobile operator clients with an unrivalled repository of subscriber intelligence…. Moreover this subscriber intelligence is characterised by its use of fine-grained preference and behaviour data, unlike more traditional coarse-grained demographic features. This is important because it means that these profiles facilitate a more targeted approach to content recommendation and advertising. For example, these ClixSmart profiles cover approximately 1 billion preference features that capture critical information on the lifestyle and behavioral preferences of individual subscribers and communities of likeminded users.”^[155]

Such data mining technology, as Acuity Mobile explains, “Improves with Use—All user response is tracked and used to augment the system’s understanding of the user’s preferences and interests to improve accuracy and to populate the client’s customer database.”^[156] Ultimately, of course, the goal of mobile marketers is the same: “…to reach individual consumers on the most intimate level without wasting exposures on uninterested or irrelevant audiences,” as Ad Infuse points out.^[157] Commenting on its own adInMotion platform, Ad Infuse explains that “To find the most relevant advertisement for an individual mobile customer, the advanced matching algorithms of adInMotion™ use:

• Data about content and advertisements
• Contextual information, e.g. time, place, media usage patterns
• Customer data, e.g. age, geography, subscription type
• External customer intelligence sources, e.g. M:Metrics, ComScore, etc.^[158]

With so-called “just-in-time search advertising” on mobile devices, moreover, ads can be tailored according to where the user is perceived to be in a given transaction cycle. For example, Medio’s MobileNow explains that

with the immediacy of ads placed within search results, you can influence mobile customers at the exact moment they’re ready to act…. [Y]ou’ll target the people who are the most interested in your product…. [U]sing data beyond keywords, Medio presents timely ads relevant to the user’s query and individual context, including device type, location, language, recent searches, and more…. Medio works closely with our partners to create the richest set of user data available. Through our deep expertise in data mining and analytics, we create behavioral “clusters,” mapping users’ tastes and preferences to provide better search results and more relevant ads. Of course, we also provide targeting parameters, specified by the advertiser.^[159]

Boasting of its “unique data mining and analytics expertise, enabling supercharged merchandising based on historic and similar behaviors,” Medio also explains that mobile marketing will offer highly personalized results as well, via “customer insights derived from advanced data mining… with an understanding of what’s important to the individual subscriber.”^[160] What’s important to the individual subscriber, if truth be told, is privacy and security and reliability, concepts that are conspicuously absent in the trade press. It is incumbent upon the FTC, then, to ensure that mobil marketers begin to take these consumer interests to heart.