It's been the year of mobile for about a decade now. But thanks to the iPhone (and other smartphones), it looks like mobile advertising is set to make some actual progress this year.
According to new study by Gartner, mobile ad spending worldwide will grow 74% this year to $913.5 million but not really accelerate until 2011, when advertisers are expected to commit to mobile as part of the digital shift in the ad market.
And what is bringing in the most money in mobile so far? The dreaded banner ad.
Banner ads may not work online, but they're one of many formats that are succeeding in mobile.
According to Gartner's report, titled "Mobile Advertising Grows Quietly":
"The growth in mobile advertising revenues is primarily driven by mobile Web banner ads, but it also has a strong growth component from mobile search, downloadable applications and SMS advertising."
By the end of this year, the mobile ad market is expected to grow to $913.5 million. And by 2013, the research firm expects mobile ad spending to surpass $13 billion, with the Asia-Pacific region bringing in the most revenue, followed by North America and Europe.
The increased adoption of smartphones is helping to accelerate the growth of mobile ads, as technology gets easier to use and consumers become more comfortable using their phones for more purposes. From the report:
"GPS-aware apps now provide a much simpler and more cost-effective means of achieving location targeting, while lowering the risks of consumer backlash."
Because of the increase of location aware applications, Gartner is bullish on Yelp and Citisearch, saying that media companies will
either have to develop — or acquire — local directory services to take full advantage of location-based advertising in mobile.
Gartner expects smartphones to account for 45.5% of all mobile phone sales in 2013, up from about 9% in 2008. And the increase of smartphone usage is rising the tide of all mobile technology.
Gartner analyst Andrew Frank tells MediaPost that that increased usage of mobile media is leading Web publishers to create more versatile versions of their mobile sites, "which in turn is lifting mobile Web access among non-smartphone users."
Based in New York, Meghan Keane is US Editor of Econsultancy. You can follow her on Twitter: @keanesian.
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Director of Product Development at Econsultancy
7:06PM on 1st September 2009
Gartner previously predicted global mobile advertising spend would hit $14.6bn in 2011, so this seems to be quite a climbdown from that estimate...
8:02PM on 1st September 2009
Chris, if someone have a patent on "method and system for electronically distributing sales information to a selected group of individuals" see link: http://bit.ly/CmzvI and our product "the BipBip System" see link: http://www.bipbip.com -how do you see there possibilities in this market in the future?
Online Marketing Consultant at Azam.net Marketing
9:55PM on 1st September 2009
Yawn, been reading such reports about the growth of mobile since 1999. May be exciting to newbies, but to those know the industry it doesn't excite any more.
Fact is - and I speak from knowing precise sums that companies have spent - that billions have been spent on trying to make profit through mobile by marketing agencies and tech. companies in the last decade and almost all have lost money.
CEO at Conversion Online
10:33AM on 2nd September 2009
This is exciting news. In my experience having worked with MTN (Top 2 cellular networks in South Africa) in 1996 and then becoming involved in online marketing for fortune 500 clients, banner advertising is what funded much of the growth of the internet. Unfortunately, most marketers and decision makers simply don't understand electronic marketing. The banner ad is easy to understand. Most CEO's have said these words before: "Make it red and make it flash and say 'limited offer', make sure hundreds of thousands of people see it and I'll pay for it". Figures like these are important to e-marketers. The truth is that most businesses fail and the truth is that mobile advertising will grow dramatically. Predicting whether or not to throw money at it is up to the early adopters, and there are always early adopters.