While mobile is presenting some tough monetization challenges for companies like Facebook, it’s increasingly looking like a boon to others.
And things are only going to get better according to a new report published by analyst firm Juniper Research. According to Juniper, by 2017, mobile search and discovery, which Juniper considers to include ads in the paid search, local search, augmented reality and discovery app categories, will be a $15bn per year business.
It’s not difficult to understand why: the ‘targetability’ of some of these ads is considered to be very high, and high CPC rates coupled with high CTRs is causing advertisers to spend more on them, producing, of course, more revenue for companies like Google.
But the Googles of the world may not have the greatest opportunities as Juniper sees it. Daniel Ashdown, the author of Juniper’s report, noted:
Web search results, by their very nature, are more generalised, despite the local parameters search engines offer. Furthermore, the websites linked-to in search results are often not optimised for mobile devices.
Because of this, local search apps, like those offered by companies such as Yelp and Qype, may have an easier time cashing in as they can lead their users “through the whole process, to reaching a purchasing decision.”
The biggest challenge in capturing a piece of this multi-billion dollar pie, Juniper says, will be differentiation. Players like Google, because of their market positions, will do very well because they capture so many mobile searches. Those that can offer better experiences and targeting will need to differentiate themselves to stand out.