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The evolution of the mobile ad ecosystem is ushering in some new disguises.

I spoke recently with several practitioners about where mobile ads are heading.

“The customer experience [of mobile ads] is totally broken,”  Joe Prusz, ad tech firm Rubicon Project’s head of mobile, told me, referring to both web and in-app ads.

He pointed to tiny banner ads that people can’t even read, a smorgasbord of different Android system versions that advertisers and publishers have to deal with, and data standards that “are not fully baked for targeting and retargeting” of users.

In light of those conditions — plus the expected increased use of ad blockers on iPhones — MassiveImpact CEO Sephi Shapira sees a “massive trend toward native ads.” His company offers a performance-based mobile ad platform.

Native ads offer the same viewing quality as the surrounding content, are served along with content or the app, and expand upon the web content or app experience that the user has chosen.

But Shapira’s vision of native ads goes far beyond those that today are embedded in news and other feeds or pages, and blend in with the surrounding style.

While native ads are traditionally supposed to offer some visual distinction that identifies them as ads, Shapira sees ad blocking as pushing ads in the other direction.

For mobile, he predicted, the move is toward “the end of clearly separated ads.” He compared it to the evolution from prescription glasses to contact lenses and then to laser eye surgery.

Even with user targeting, mobile ads — web ads in particular — are blunt instruments that, at best, follow you like a lost puppy for days after you entered that one search query or visited that one site.

Functional assistants

Native ads are appealing to advertisers because, as Prusz notes, their clickthrough rates are two to five times greater than those of display ads. They often offer content that complements the surrounding editorial, so they expand on a user’s interest the way Google search ads do.

There’s also the expectation that mobile web ad blockers have a harder time blocking native ads, because they are served as part of an editorial feed. But some tests have shown that native ads can be blocked, so publishers and advertisers may soon be upping their arms race to serve in-content ads more like content.

To move mobile ads away from being annoyances, Shapira wants to see them evolve into their next role, that of functional assistants, serving answers to your specific questions.

“In five to seven years, ads will be so efficient and effective,” he told me, “you won’t be aware of them.” They will operate more like intelligent recommendations, he said. Or, possibly, some recommendation engines will essentially operate like curators of selected ads — which could raise their utility while risking lowered trust.

Shapira pointed to the app for the Uber car service, where you request a car and then one that meets your requirements is presented to you. “It’s [like] the ‘I feel lucky button’ on Google, every time,“ he said.

Arguably, this is the future of mobile ads. They will be tailored so specifically to your interests and will provide such a high level of utility, like Google search ads do, that you will welcome them as you would content that you seek out. The idea is that, even if your ad blocker could block them, you wouldn’t want it to — because they deliver the advertising equivalent of the right Uber driver.

“This is product placement gone wild,” Shapira said.

Device fraud

“Gone wild” is the correct descriptor here. If ads become so integrated into content that they vanish like eyeglasses have, the question is whether users will be able to trust anything they read or do online.

Usefulness is one thing. Self-interest disguised as usefulness is another. One result of ad blocking is that it is driving the adoption of disguises as the industry adapts to avoid blocking, as well as pushing ads toward utility, to make them more palatable.

Shapira acknowledged that this ad future will require a new kind of industry self-regulation, but the popularity of ad blocking has grown, in large part, because advertisers and publishers have little self-restraint. More likely, it will require the Federal Trade Commission to redefine appropriate advertising.

But a different kind of disguise can work against mobile advertisers. Brian Mandelbaum, founder and CEO of video ad platform Clearstream, described to me recently a kind of disguise that “is rarely talked about.”

“What we’ve seen pop up in the last few months,” he told me recently, “is the pervasiveness of device fraud.”

It’s a way for fraudsters to “command different rates” for mobile ads, he said, since an ad to an iPhone user might be considered of higher value than that same ad directed to a user of a Windows phone.

He said it exists even in the “good neighborhoods” populated by premium publishers, and estimated that this kind of device misrepresentation may be in the “mid to high single digits.”

One solution is a remote instrumentation that generates a kind of fingerprint of the device, returning info about screen size resolution, the device ID, the buffer rate, and other particulars that a fraudster may not imitate successfully.

But, Mandelbaum said, this approach is “complicated and not a silver bullet.” Which is not surprising. Disguised guests, whether bad guys or good ones, are not easy to get rid of once they’re part of the party.

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