Smoke markers were used in bombers from the late 1930s through World War II. They were filled with white phosphorous and were dropped by the lead aircraft when the target had been determined. It signaled the remaining aircraft to drop their bombs. They identified the general target location for the other planes in the squadron. As you can see in the picture the smoke markers point to the target.
The wooden ones floated and were a smoke-producing flare designed to be dropped by an aircraft over open water for drift sighting during the day or night. When the drift signal is thrown from an aircraft it floats on the water and gives a light and smoke which are visible to an observer in the airplane from which it was dropped. These signals are used in obtaining the drift of the airplane from which it was dropped.
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