It is a familiar refrain in the mobile advertising business; spend on mobile campaigns lags far behind consumer attention devoted to the mobile medium. In a way, that’s good news, as it illustrates the immense potential and opportunity for both publishers and advertisers to mine this exciting new channel using innovative new ideas.
So, what are the numbers?
Berg Insight estimated that mobile ads and marketing comprised a €3.8 billion (U.S. $5 billion) market in 2011, dominated by Google’s AdMob and Apple’s iAd platforms. But Berg is predicting that numbers will grow by a factor of 5 into a €19.7 billion market in 2017. In the UK, the Internet Advertising Bureau UK (IAB) said the sector grew by 132% to £181.5 million in the first half of 2012 to account for 7% of digital ad spend.
This trend is reflected in the activities of the market’s more forward-looking agencies. For example, M&C Saatchi’s mobile division contributed 15 to 20% of the agency’s total UK profits last year.
Progress is being made fast. But there is a long way to go. To put the above figures into context, digital was 16% of all expenditure in 2012, making mobile outlay equal to just over 1% of the entire UK spend on advertising. Yet mobile is grabbing an ever-larger share of consumer attention, as demonstrated by the diagram below, where time spent on mobile is at 23%.
According to a US study by Flurry, people now spend more time on mobile apps (127 minutes per day) than they do on the desktop web (70 minutes). Mobile is not far off TV, which commands 168 minutes of viewing a day from consumers.
What is holding mobile back is a belief that the audience is too fragmented to be reached effectively and that good, useful data on users is still elusive. This is not the case, anymore. New services and technologies, demand side platforms and real time bidding are making it far easier for brands and agencies to run targeted mobile campaigns and achieve impactful results and excellent ROI.
Meanwhile, new forms of ‘rich media’ advertising are making the executions more appealing to end-users.
Takeaway
- Mobile advertising continues to experience rapid growth
- Consumer time spent in mobile apps is exceeding desktops and will soon overtake TV
- Overall mobile expenditure in digital still remains relatively small
- Marketing manager concerns over lack of data/insight and tracking on mobile should be dispelled as this is no longer the case
