The Primacy of Mobile Advertising

August 23, 2011

 

Currently the mobile advertising game is not even in TV’s ballpark.  Not in the same league, world, or even universe.  Television pulled down nearly $60 billion in ad spend last year - compared to mobile, which this year is expected to top the $1 billion mark for the first time.   With a gap of $59 billion, is it realistic to think mobile ad spending will someday compete with TV?  

Despite that staggering difference, the mobile advertising industry doesn’t seem to be worried - some analysts predict a very bright future for mobile advertising.  With such an enormous discrepancy between the two advertising spending amounts, why do mobile advertisers remain so inherently confident?

The answer is not where the game is but rather where it is going.

In an interview with AdWeek’s Erin Griffith, Mobile Practice Lead of Razorfish Paul Gelb firmly states why he believes mobile ad spend will overtake television’s:

“There are over three times the number of mobile subscribers as there are TV subscribers.  It’s the most adopted technology and media channel in history, engagement rates are higher and inventory, because of 24-hour access to users, is unmatched.” 

Furthermore, Gelb believes it won’t be long for the takeover to happen - citing it has only been four years since the first iPhone was sold and smartphones are already outselling PC’s.

With that type of ringing endorsement, what is standing in mobile’s way of becoming the biggest player in the ad game? 

In the article,  ‘Why the Pipes Are Broke in Mobile Advertising,’ AdAge writer Kunur Patel points to one complicated hurdle standing in the way: fragmentation.

“Marketers report that device fragmentation and lack of standardized metrics and ad formats are among mobile advertising's biggest challenges, according to the Interactive Advertising Bureau's recent survey of 300 U.S. marketers that use mobile advertising.”

This lack of consolidation amongst systems that offer serving, measuring and creating mobile ads is directly responsible for the disjointed mobile playing field.   Without a standardized format, you have ‘isolated solutions’ that may work on one network (iAd) but won’t translate to another (AdMob).

Patel continues, “There are no all-encompassing ad-servers that work on all mobile properties or ad networks so agencies can keep track of campaigns in one standard way.”

Despite this formidable barrier and other growing pains, experts are bullish on mobile advertising - dollars are moving in its direction at rapid clip. According to a survey of 300 top-level brand-marketing executives, 75% indicate they plan to increase their mobile ad spend while 35% say they will be spending more than half of their total ad budget on mobile.

So what makes mobile advertising so appealing?

“Fifty-seven percent of respondents pointed to immediacy of the response; nearly as many point to cost-effectiveness; and over half said increased engagement was a key benefit of mobile.”