Why are brands investing in mobile advertising?

According to the IAB, mobile ad spend grew by 127% in the first half of 2013.

According to the IAB, mobile ad spend grew by 127% to £429.2 million in the first half of 2013 and now accounts for 14.1% of all digital advertising spend, which is nearly double the same time last year’s figure of 7.2% (IAB).

A recent study by BBC World News found that mobile advertising is now more than twice as effective as desktop (The Drum). It’s predicted that overall US spending on mobile advertising will grow a further 56% next year, with desktop ad spend increasing by just 0.41%. By 2017, mobile ad spend will overtake desktop at an estimated $35.62 billion (Emarketer). In total, global mobile ad spend is expected to grow at an average of 26% each year over the next five years (Business Insider).

So why is the mobile device such a promising prospect for advertisers? Aside from the obvious fact that mobile is where the audience is, there’s a few key reasons why mobile advertising may be more effective at engaging consumers.

1. TARGETING

Most people take their phones with them everywhere – geo-targeting allows for location-based mobile marketing. Ads can be customized and targeted based on the user’s usage behavior and other data collected. Targeted ads are usually more contextual to the consumer, so they’re more likely to interact with that ad in some way.

“Accurate geo-targeting is extremely powerful because it enables marketers to identify interested consumers and makes it easy for interested consumers to call, visit, or make a purchase.” (iMediaConnection)

2. DISTRACTIONS

With mobile theres a much smaller screen to look at, with a lot less going on. On desktops we usually have multiple tabs and programmes open so it’s difficult for advertising to catch our attention. Advertising on mobile devices is relatively new so banner blindness isn’t so rife – we haven’t channeled it out yet.

It could be suggested that consumers use their mobile devices during leisure time when they’re relaxed with less distractions, and so may be more open to engaging with ads. Desktops however, are used more for work purposes in the office or at home. (The Guardian)

3. MULTI-SCREEN LIFESTYLE

Our lives are consumption-heavy and increasingly people are demanding constant interaction. Marketing budgets are increasingly giving more weight to multi-screen campaigns – a 2013 study from Nielsen and ANA found that two-thirds of marketers spent up to 25% of their budget on them (Nielsen).

“Our love of multitasking and the changing nature of media consumption has invented a new arena for marketers to play in. It’s clear that the new trend is being taken seriously as marketers swarm to create multiscreen campaigns and engage with users across multiple platforms.” (DotRising)

4. BETTER ADVERTISING

New and creative advertising formats can thrive on the mobile device, including rich media and video. Consumers are naturally more compelled by innovative content. Aside from this, advertising on mobile can be ‘better’ simply because it is more relevant due to increased targeting opportunities.

“Our next generation of mobile ads will no longer be intrusive, annoying or pop up when not needed since technology is enabling us to create more on-demand app download options which tie in with location data, creating a content proposition that users really want to be a part of.” (The Drum)

 

Fundamentally, mobile technology opens new and wider opportunities for advertisers by getting them closer to their audience than they have ever been before. The collection of data and a deeper understanding of consumer behavior allows for more targeted, contextual and relevant ads. With a wealth of research conducted on desktop advertising, brands know what consumers really don’t like – intrusive, annoying and irrelevants ads. The use of mobile devices have become the norm in consumers’ lives but as much as this is a huge opportunity, advertisers also have a responsibility to figure out how to be part of that in a way that consumers will accept it, and ultimately interact with their ads.

Future Coull blog posts will be looking at the challenges that advertisers face in mobile advertising – so keep an eye on our Twitter page for the latest updates.

Posted by simonholliday