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Mobile ad spend hits all-time high - study

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26th Mar 2012
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Mobile advertising skyrocketed last year to reach an all-time high as brands boost investment into rich media, according to new research.

The latest annual Internet Advertising Bureau (IAB) and PwC mobile advertising spend study revealed that advertising on mobile devices skyrocketed by 157% in 2011 to a new high of £203.2m.

With the smartphone ownership standing at 53% of the population, as well as the proliferation of touchscreen technology and tablet sales, this has sparked a surge in brand spend in apps, said the study.

Additionally, the rapid increase of apps and social media, fuelled in part by cheaper data tariffs, has created a new era of “dual” and “triple screeners” with over half of the population watching TV whilst using a mobile device, causing marketers to create more rich media ads.

According to the report, entertainment and media took the highest share spend last year with 23.2% followed by telecoms (14.9%), consumer foods/FMCG (14.4%), retail (12.3%) and finance (10.3%).

The report also showed apps are worth more than half of all display with 54% of display advertising now on apps; while 46% of display advertising spend is on browser inventory.

Display advertising on mobiles more than doubled year on year, increasing by 186% to £68.9m (£28.1m in 2010) and a market share of 34% (34% in 2010). In 2008 display advertising on mobiles was worth £14.2m, so it has risen five times in three years, said the report.

Additionally, standard display formats have driven growth, which has risen 96% to £59.4m. However, the category including SMS and MMS advertising grew by 241% to £7.6m (£2.5m in 2010).

Mobile video advertising (pre / post-roll) also increased rapidly to £0.8m (£0.2m in 2010) as brand advertisers invest in new rich media formats, said the report.

Mobile search was up 145% to £134.3m (£54.9m in 2010) and a market share of 66% (66% in 2010). In 2008, search was worth £14.4m, so has grown nearly ten times in three years.

The report also showed that from launch in 2010, tablets are now an everyday device with more than 4.1m Britons owning one. As a consequence, the IAB has measured tablet-specific advertising for the first time and found that £2.4 million was spent in 2011.

Jon Mew from IAB said: “This study proves just how engrained mobile has become within both brands’ and consumers’ day to day lives. With 26 million smartphone owners now in the UK – the opportunities for brands to interact with consumers in a more innovative and relevant way are endless. So it’s no surprise to see mobile advertising continuing to grow at such an overwhelming and encouraging rate.’’

Anna Bartz from PwC said: “Mobile advertising is gaining momentum – with growing opportunities to target consumers with a range of innovative formats, on the web and in mobile applications. The rapid adoption of smartphones and tablets means mobile is offering a compelling new way for brands and advertisers across all sectors to reach people, making it an increasingly powerful platform in multi-media strategies.”

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