Local merchants in Chicago such as La Fonda Latino Grill and Spoil Me Salon & Spa are participating in the pilot of a new mobile ad network enabling them to target public transportation riders with offers intended to drive in-store traffic.

CommuteStream claims to be the first mobile ad network using mass transit patterns to target consumers whose routes take them nearby specific merchant locations. It is being piloted on Chicago Transit Authority, whose riders take more than 1.4 million daily transit rides on buses and trains.

“For local businesses, the best customers are most often those with reoccurring and convenient access to those businesses,” said Sam Pro, co-founder of CommuteStream, Chicago.

“Mobile ads make it easy for businesses to reach riders whose daily lives bring them within close proximity of their location,” he said. “And they target them while on the move when they are most likely to stop by a local business.

“These riders are already nearby on a regular basis and might just need a little nudge to get them in the door. We are not just about driving foot traffic, but about matchmaking between businesses and riders who have the potential to be high quality repeat customers.”

Predictive geo-targeting
The CommuteStream ad network uses predictive geo-targeting to deliver offers based on individual rider travel routines and preferences, with the ads delivered inside transit applications that collect transit data such as train and bus trackers.

For example, a local bar could promote a daily special to consumers who take or bus or train that passes by their location.

The ad network is leveraging how mobile users are increasingly engaging with apps to assist in their everyday activities. In particular, transit riders frequently use apps offered by their local transit authorities to see if their train or bus is on schedule.

An example of an offer

Hyperlocal advertising
Other local merchants participating in the pilot include Apart Pizza Company, Paradise Pet Salon & Spa Too and Savvy Seconds & 1st’s

The ad network is also an example of how mobile is driving growth for hyperlocal advertising.

CommuteStream plans to expand the network to reach riders on public transit systems around the country.

“A typical experience might be a businessman using a bus tracking app to decide whether to wait for the bus or to grab a cab,” Mr. Pro said.

“As arrival times for the buses are shown within his tracking app, so is a banner ad for a free coffee at a cafe next door to his work,” he said. “Or maybe it’s a happy hour deal near his home that he can use later that night, or 20 percent at the grocery store he passes by every day.

“We’re essentially taking ad space that already exists inside these apps, and drastically increasing its relevance and locality, and in doing so also improving the riders experience. Tapping on our ads provides more information about the deal or offer and easy access to directions, contact info, etc.”

Final Take
Chantal Tode is associate editor on Mobile Commerce Daily, New York