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Mobile Advertising Expected to Jump to $11 Billion

8-30-2012

As Radio debates over what to do with its online stream, consumers are giving clear signals that their lives revolve around the tiny device they carry around in their hand, or their pocket, or use when they should be focusing on the other vehicles around them. The smartphone is changing the way people communicate, listen to music, punch up directions, browse Facebook. It's almost an extension of the human body that nobody wants to leave home without. Marketers are also realizing the Return On Investment they see using mobile ads is pushing them more and more toward that platform.

Pandora reported its Q2 mobile revenue was $59 Million. We wondered if the entire radio industry comes anywhere near that number in a year. A recent white paper (link below) shows that Mobile advertising now accounts for less than one percent of marketing budgets. "However, based on sophisticated return on investment (ROI) analysis of Mobile, the optimized level of spend in Mobile advertising for U.S. marketers is seven percent, on average. Over the next 4 years, Mobile’s share of the media mix is projected to increase to over 10 percent based on growth in adoption of smartphones only," according to the study.

The study points out that the only reason spending isn't higher now is because marketers are slower to adopt to the new technology than the consumer. "Consumer media habits are rapidly changing – the penetration of mobile smartphones has skyrocketed and it is clear that Mobile has proven to be effective in successfully achieving a variety of marketing goals. Even though these facts are indisputable, marketers have been slow to adjust and rebalance their media mix to reflect consumers’ mobile-centric world. In fact, it is appropriate to assert at this time that most marketers should significantly increase their investment in Mobile advertising. While this may be a bold statement, it is a statement based on science and mathematics; it is rooted in what we quantitatively know about all media’s impact as well as Mobile’s impact and penetration to date. Based on this information, Mobile advertising (display, video, audio) should be at least an $11 billion dollar market in the U.S. and higher globally assuming similar dynamics exist worldwide."

Read the White Paper HERE




(10/24/2013 2:43:07 PM)
CE5Czh Fantastic post.Much thanks again. Cool.

- NY
(9/1/2012 8:01:58 PM)
Just wait until car radios include online streaming and you will see the popularity of terrestrial radio start to tank.

- Jacko

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