The mobile advertising myth needs to be questioned. Especially if you are in the mobile social networking area. I know mobile marketing is growing. I ran ads from AdMob in a community when AdMob where about to serve the one billionth ad. They are heading for 70 billion now. My point of view is from the community relying on advertising soley.

The typical mobile community/social network has a high number of page impressions per user. So your total inventory could be pretty impressive. But can you make money from it? Probably not enough.

Advertisers want to reach many unique users rather than high frequency of the same messages to the users. When I ask around it also becomes clear that many advertisers are not happy to advertise on peer-to-peer and user generated content type sites. They prefer a strict editorial site with a big brand. That is poor code for that they want a seriously controlled environment. They do not trust their prospective and existing clients in a free social and interacting environment. That distrust is of course questionable and subject of a whole row of other posts. I leave them for now. At the end of the day, the advertisers do not fancy mobile social networks all that much.

But even if you have a great site and everything figured out there are too many business plans chasing very few advertising dollars. On that note there is a great article in the recent Economist. Read it here. And one of the editorials as well in the same issue. Read that one here It’s a summary over that last six years in Silicon Valley at large but applies very well to this.

So,what to do then? Premium subscriptions, microbilling, advertising? The key here is to think critically about what you really are offering and why. The only rule is to have the guts to ask your users to part with their money (or enough attention so an advertiser wants to pay). But hey, your service is great, right? Then your users would value it enough and feel they get a bang for their buck. So go ahead. Ask them for their money. If you don’t you are running a charity without a cause and I am afraid I have to call you reckless.

Don’t forget the option to mix models. Free ad-funded with a few extra features you have to pay for. I guess this is what many call “freemium” model. Again, here you have to have some pretty good features that you know enough users will pay for. This is when you should count yourself lucky. Because you are in the mobile world. The mobile phone have some unique features that beat the PC. Things like it always being on (the number of people never turning off their mobile is increasing by the day), always with you and always there at the moment of inspiration are features you can monetize if you package it right.

Then you have to pick your fights of course. Don’t be the umptieth service of the same kind in the same market. Speaking of market. The current chaos in the world can be your best friend. Your services are probably not that expensive so make them fun and relevant enough for your users and they will stay with you and bring in new customers for you. In a downturn people seek low cost rewards, treats, closeness to others and comfort. Why do you think sales of chocolate bars, lipstick and condoms seldom dip in a downturn? Some companies will go bust and others will scale back marketing budgets. This means you have less noise to cut through with your campaign, viral guerilla stuff or whater you call your sales and marketing.