Mobile advertising, long the ugly stepchild compared to its desktop sibling, is coming into its own, if not outright flourishing. Recently released projections from eMarketer estimate that mobile will capture almost half of the total digital ad spend in North America in 2017. Much of the growth over the past few years has been due to advertiser dollars belatedly following where users' consumption habits had migrated. But what else is driving such tremendous growth in the years ahead?
1. Smartphone Penetration Continues to Skyrocket
While desktop penetration and usage has plateaued in this mature space, the rapid adoption of smartphones has enabled large cohorts to replicate the richness of their desktop experience on a device that fits in their pockets. According to a Pew Internet study, 56% of Americans own a smartphone, up from only 35% as recently as 2011.
Those smartphone owners are spending quite a bit of time - about an hour a day, according to research by Experian, only a quarter of which is spent talking - with their mobile devices. That represents a fifth of their total media consumption, five times a greater share than just 4 years ago. The growth of 4G data availability has coincided with a mobile data consumption climb (with some operators averaging around 1 GB/month per customer, and some devices close to double that).
2. Mobile Media Continues to Grow
While consumers enjoy a growing proliferation of smartphone and data plan options, publishers are giving them plenty of media to consume while on the run. In North America, over 15% of web usage is through mobile, up from 9.4% just one year prior. In the UK, for example, 55% of sites surveyed for a report by Econsultancy have optimized their sites for mobile, almost double that from less than two years ago.
Mobile app usage continues to climb a similarly steep curve, as well.
3. Mobile Advertising Is Becoming More Effective
The nut that had been heretofore impossible to crack is showing some signs of fracture. The news that Facebook derived 41% of its Q2 revenue from mobile has given plenty of mobile marketers hope, especially since Facebook app usage comprises about 18% of the total time spent on iOS and Android devices.
Facebook and other Web publishers (including People.com, which we profiled in our eBook on native advertising) have increasingly turned away from traditional banner advertising—even more of a nuisance on a touch device when toggling between pages and tabs is tougher—in favor of in-stream, native embedding of ads that disrupt a user's browsing experience considerably less.
Although most of the statistics in this post focus on the US/North America, similar trends are driving upticks in mobile usage and advertising elsewhere on the planet. Interestingly, one region of the world has a higher mobile share of web usage than any other at 26.6%: Asia. As the bulk of global economic growth is widely expected to come from Asia in the decades ahead, this should have fascinating implications for the trajectory of mobile advertising.