Virtual Goods in Location-Aware Mobile Games: The Future of Product Placement

Booyah, a location-based game start-up, has announced it'll be trying out a new type of promotion that may be the model for smartphone ads in the future: In-game, virtual goods placements, based on your real-time location.

Booyah's partnership is with Swedish clothes chain H&M, and the resulting ad plan is dazzlingly simple: When you're near an H&M location, a particular piece of clothing--perhaps one on promotion--will appear in the Booyah MyTown location-based social "game." If any of...