The Future of Print

Mobile advertising leaps 116 percent, but digital ad slowdown worries remain | TheMediaBriefing

Posted in Boom, Tablets by futureofprint on March 24, 2011

Here’s a fact to brighten up your day: mobile advertising grew by 166 percent to £83 million in 2010, up from £37.6 million in 2009. New figures from PwC/IAB show that the rate of growth is unprecedented and is a note of optimism in an otherwise hesitant online advertising landscape.

Here are some other take-home points from the study:

– B2B and specialist media are increasing their share of the mobile ad spend pie, including telecoms and financial publishers, albeit from a low base

– Mobile search ad spend has tripled from 2009 to 2010, from £20.2 million to £54.9 million.

– Mobile display spend was up 61 percent to £28.1 million, up from £17.4 million in 2009,

– Mobile display ads, all those banner ads, text links and flashing things that you all ignore, rose 62 percent to £23.7 million.

– Pre- and post-roll ads rose 492 percent to grand total of… £1.1 million (translation: people didn’t used to have rich video-enabled phones, and now they have iPhones and Android phones).

– Entertainment is the biggest sector with 32.9 percent of mobile display ad spend, automotive is the smallest with a piddling 6.5 percent.

And the usage is, of course, through the roof. Smartphone ownership was up 58 percent year on year in 2010 to encompass 38 percent of the population – according to December figures from ComScore Loading… companies comscore .

And we’ve not even mentioned tablets yet. Here’s what Dominic Jacquesson, author of our new research report on mobile media strategies, says of them:

“When Apple Loading… companies apple-inc released its Q4 2010 sales, it revealed iPad sales of 17 million in the nine months since launch. It took the iPhone 21 months after launch to reach the same point. Every major analyst tracking Apple has under-estimated the success of the iPad, despite all the hype, and we can now expect sales estimates for 2011 to notch up once again.

From 15 million when it launched in April, to 28 million by November, and now nearer to 40 million – truly phenomenal for a brand new category of device, and starkly underlining the consumer appetite for tablets.”

What does this mean?

It means lots of people are buying smartphones and tablets and using them as a secondary – not primary – browser, and the ad market has a lot of catching up to do.

Mobile’s growth rate is impressive but the levels of spend are not. A 30-second advert during X Factor can go for as much as £250,000 – almost one tenth of the entire UK spend on mobile display ads.

Moreover, as the WARC figures from the end of last year showed (via Guardian), more than a third of display ad spend is specifically designed to get people to watch TV shows, to take them back to the big box in the corner and away from the small box in their hands.

Although, the two-screen viewing habits of modern Britons shouldn’t be ignored and so many of us watch the tube with a iPhone/iPad/laptop in front of us. TV vs mobile isn’t a zero-sum game and there is exciting growth in social TV participation business models.

Only so much money to go around

But the wider problem is a stagnation of online ad growth in the UK and elsewhere. If we look at the big picture, digital services will only account for 33 percent of European ad spend by 2014, including mobile and “desktop” browsing, according to PwC’s Global Outlook 2010-2014 study (pdf link).

According to Nielsen figures published in Marketing last week, 77 of the top 100 UK advertisers increased their spend in 2010, but at the same time the amount some big league player apportion to paid-for online ads is still tiny.

Proctor & Gamble spends 1.3 percent of its massive budget on paid-for display ads. Unilever Loading… spends 1.9 percent of its budget on the same, or £2.6 million. O2 is notable for remaining the country’s biggest online advertiser by spend, despite decreasing its total ad budget by nearly a third.

There is a hell of a long way to go before ad buyers and agencies see mobile as a core part of their campaigns. And if WARC’s prediction of a 2.3 percent all-media UK advertising rise for 2011 is accurate, then there will be a lot of people fighting over want scant new money will enter the market this year. And despite the smartphone/iPad craze, you can bet it won’t be mobile advertising that takes the lion’s share.

via Mobile advertising leaps 116 percent, but digital ad slowdown worries remain | TheMediaBriefing.


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