Are You Helping Clients Make the Most of Native-Social?

Thu Jul 6, 2017

Kathy Crosett

Are marketers really going to spend $40.2 billion on mobile advertising this year? BIA/Kelsey analysts think so and they support their projections by looking at consumer media time devoted to mobile phones and advertisers’ attempts to reach these digitally savvy folks. Here’s what you need to know.

A quick review of mobile phone statistics shows that 223 million, or 89% of all mobile phones, are smartphones. These phones allow users to search on the fly for restaurants, stores, products and services.

Marketers are showing more willingness to spend on mobile campaigns that work. This year, at least 40% of mobile advertising, or $16 billion, will go to location-targeted marketing. In BIA/Kelsey terms, the location term is about the ‘localization’ of the ad campaign. Large marketers know they can encourage shoppers to visit their local stores when they roll out personalized ad campaigns. They know that up to 30% of online searches are all about folks looking products and supplies to buy in the local market. The majority of these kinds of searches, 76%, end up leading a consumer to a local store within 24 hours.

BIA/Kelsey analysts also segmented the location-targeted ad market by advertiser type. This year, local SMBs will spend $2.56 billion on location-targeted ads, while the rest of the spending, $13.46 billion, will be done by large brands seeking to connect with local consumers.

Here is how all mobile ad spending will break out by category for 2017:

Traditional Display – With spending of $6.5 billion, traditional display is not expected to increase its share of the mobile marketing pie. Analysts believe younger consumers associate online display with traditional, and therefore, untrustworthy, forms of advertising, so businesses are not boosting spending on this format.

Search – Marketers will shell out $15.798 billion, which amounts to over 40% of all mobile ad spending. The 3% click-through rate on this format is one reason marketers continue to use mobile search.

Messaging – In a shift away from SMS (messaging), marketers are engaging in “conversational commerce.” As marketers answer consumer questions online, and in the mobile space, they’ll have opportunity to generate an ad. This year, messaging ads will amount to $630 million, but by 2021, the category will be worth $4.4 billion or 6.2% of the mobile ad market.

Traditional Video – This format will likely increase to $3.8 billion this year. Video advertising will gradually increase its share of the mobile marketing ecosystem, but not in the pre-roll format, which is seen as intrusive.

Native Social – For now, native social is expected to be the fastest-growing mobile ad format in the next several years. By merging ads into mobile social apps and targeting based on past behavior, marketers can capture consumer attention with content that doesn’t look like a traditional ad. The category will capture over $13 billion in mobile ad spending this year.

If you’re selling mobile ad space, share this data with your prospects and clients and help them get the most out of their investment.

 

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About Kathy Crosett

Kathy is the Research Director for SalesFuel. She holds a Masters in Business Administration from the University of Vermont and oversees a staff of researchers, writers and content providers for SalesFuel.

View all posts by Kathy Crosett
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