by Marian Hetherly
e-marketingclass contributor
If you yawn when you read another headline about mobile advertising and its ever-pending explosion, you’re surely not alone. It seems that year after year, experts are touting the mobile platform as the next big thing that needs to be on top of every marketer’s mind. This year is no different, but there are a few indications that 2010 might actually be the stage for mobile advertising’s coming out party.1
ABI Research released a report on July 8 predicting that the amount of dollars spent by U.S. advertisers on mobile device advertising will quadruple in five years. As more people buy smartphones and tablets, the report says spending on mobile advertising will increase from its current $313 million to $1.2 billion in 2015, or a 35% increase.
“More and more will access the mobile internet,” ABI Research Practice Director Neil Strother told International Business Times. “They are using apps on these devices, spending time in front of screens. You want to go where audience is. If they are shifting their behavior to mobile audience—and they are—you want to do the same.”
Other factors driving the shift to mobile advertising are faster networks and devices that allow advertisers to run more interactive ads, affordable data plans and content from videos, music, games and social media networks. The benefits of mobile ads are ease of tracking a user’s location, a booming user base and all the advantages of traditional online ads.2
ABI’s estimates are low compared to those issued last September by eMarketer, which put mobile advertising at $593 million in 2010 compared to $25 billion for total online advertising3–and that was before the release of the iPad, which has generated strong demand. Juniper Research is even more optimistic globally. Juniper estimates that worldwide mobile advertising will have exceeded $6 billion in 2014, but this still equates to just 1.2% of total worldwide ad expenditures.
Although the estimates may vary, one thing is certain: a long-predicted Madison Avenue milestone finally arrived this year. Outsell’s annual advertising and marketing study, released in March, revealed that U.S. advertisers will spend more on digital media in 2010 than on print. Of the $368 billion marketers are planning to spend this year, 32.5% will go toward digital compared to 30.3% to print. “It’s a watershed moment,” Outsell Vice President Chuck Richard told Forbes magazine.4
Meanwhile, Pew Research released a survey in May that said 40% of Americans use wireless internet through mobile phones.2 However, ComScore estimates only 5.4 million Americans search the Web on their devices on a near-daily basis. That compares to 214 million people searching the Web generally.3 Millennial Media expects the U.S. mobile Web audience to reach 100 million unique users in 2010, which is equal to about half of the total Web audience.1
Who will suffer from the advance of mobile advertising? Television networks, potentially, if the caliber of big-brand advertising continues to be high. As the mobile audience is likely to fragment among applications, big Internet portals also may be at risk.3
However, not all marketers are convinced that mobile advertising will deliver on all the promises. Kevin Ryan, the former CEO of online advertising company DoubleClick and the founder and chairman of high-end retailer Gilt Groupe, told the Wall Street Journal that although people want to hear that mobile advertising will be huge, the screen is still too small to attract a significant portion of advertising dollars. “Even today there is almost no mobile advertising.” said Ryan. The iPad is the first mobile device he’s seen that could deliver compelling advertising to consumers.5
1“Google + IPad = Mobile Advertising Boom in 2010?” by Jason Hahn, DM Confidential.
2“Mobile Advertising Poised to Surge” by Gabriel Perna, International Business Times, July 8, 2010.
3“Apple’s Next Disruption: Advertising” by Martin Peers, Wall Street Journal, June 10, 2010.
4“Digital Lift-Off” by Dirk Smillie, Forbes, March 8, 2010.
5“Are Mobile Ads the Next Big Thing? Maybe Not,” Wall Street Journal, May 10, 2010.
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