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Mobile surge helps digital ad spend break £5bn mark

12th Apr 2013
Contributor MyCustomer.com
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The proliferation of smartphones has skyrocketed mobile advertising spend to reach £526m in 2012, according to new figures released this week.

The Internet Advertising Bureau’s (IAB) latest Digital Ad Spend report showed that this contributed to an increase in overall digital spend of £607m from 2011 to 2012, which saw the total spend reach a record high of £5.42bn and smash the £5bn barrier for the first time. 

Mobile attributed for 10% of the total spend, with advertising increasing 148% on 2011 to reach 322.7m – accounting for half of the £607m spend increase over the year. According to the research firm, a dramatic increase in smartphone ownership is fuelling this trend with comScore recently reporting that almost two thirds of the UK population now owns a device.

Additionally, this steering of investment towards mobile advertising shows that marketers are responding to consumers’ increasing use of mobile to engage with brands and taking the channel seriously. 

Tim Elkington, IAB director of research and strategy, said: “Mobile has reached this milestone because marketers are becoming more attuned to the ‘always on’ nature of consumers who expect to engage with content wherever they are. Consequently, advertisers are increasingly buying integrated campaigns across online and mobile rather than regarding mobile as an afterthought.”

The report also showed that mobile video advertising grew 1,601% from £0.8m in 2011 to reach £13m in 2012, contributing to total mobile display advertising figures of £150m - an increase of 121% in 2012. Mobile search also increased by 164% to £365m and now accounts for over two thirds (69%) of the total mobile ad spend.

Display advertising revenue was also shown to grow, boosted by the rise of video and social media ads. According to the report, display rose by 12.4% to reach £1.3bn – representing nearly a quarter of the total digital ad spend last year, with social media display advertising increasing 24% to hit £328.4m.

The IAB’s figures support recent predictions from Forrester that mobile social ad spend will reach $4.5bn by 2018. Analyst Jitender Miglani argued that mobile ads provide a better return on investment (ROI) for marketers and that, as a result, the overall mobile ad ecosystem will evolve.

“While the online advertising ecosystem (comprising ad networks, ad exchanges, demand-side platforms, sell-side platforms, data management platforms, etc.) is somewhat mature for display and search, it will evolve for mobile social over the next five years.”

Adrian Moxley, co-founder and CMO at WeSEE said of the IAB report: “These most recent figures published by IAB are evidentiary of the significant leaps we’ve already seen in the growth of video advertising in recent years. Video content is becoming more appealing based on the interactive experience it can offer viewers and it is essential that advertisers take advantage of this medium thoughtfully by delivering targeted ads that will lead to increased click-through rates and conversions.”

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