Ability to target will increase use of mobile ads

The ability to better target mobile ads will see a huge increase in spending over the next five years.

Posted on Oct 25, 2013 by YuMe

Advertising on mobile devices is already well on its way to a budget increase within the walls of many organizations, but the success of targeted marketing will further this spending, according to a recent report from Juniper Research. The company expects smartphone and tablet advertising and marketing to grow from $13.1 billion this year to $39.3 billion in 2018 with an annual growth rate of 24.6 percent for this period. The success of social media points to the larger trend of targeted marketing, especially as more of these websites start to ad their own video services.

The rise of "real-time bidding" platforms also spells a rise for online video, Juniper said, as it will now be much easier for ads to be sold by publishers as marketing experts start investing more in well-targeted real-time impressions. The report said although advertising on mobile devices is growing, there is currently low spending relative to how engaging this medium can be. Report author Sian Rowlands said this will likely grow as the consumer interaction with marketers and devices starts to expand and grow.

"We are witnessing a change in consumer perceptions of mobile advertising as advertisers begin to use opt-in or reward style advertising: by harnessing big data and location information, mobile ads are being better targeted to users," he wrote.

One area that will see a large amount of growth, according to Juniper, is in-app advertising. This will be a key driver as more people spend money and time in that market of the mobile world. India stands to see the greatest expansion, as Juniper's report said mobile ad spending will grow four-times over between 2013 and 2018. 

Video on mobile likely to continue large expansion
According to a recent report from PricewaterhouseCoopers and the Internet Advertising Bureau, mobile advertising grew by 127 percent over the first half of 2012. For this year, it is up 17.5 percent over the same period as last year's report.

"Nothing illustrates the internet as an entertainment platform better than the fact that over one in five minutes online is accounted for by entertainment, and that advertisers spent almost 1,300 percent more on mobile video than a year ago," Tim Elkington, director of research & strategy at the IAB, said.

Brands need to recognize the role of mobile video ads and how successful they could be for any campaign.