Friday, 27 February 2009

Big growth in mobile ad revenue forecast

The ClickZ website summarises a new report from The Kelsey Group that forecasts a strong growth in the US mobile advertising sector as mobile handsets continue to develop and be used more widely and for more applications, particularly with the advent of smartphones such as the iPhone.

The estimates show mobile advertising revenues growing from $160m in 2008 to $3.1bn in 2013, which is a compound annual growth rate of 81.2%. This ad spend is divided in three categories, with 2008 figures showing $21m on display advertising, $39m on search, and $100m on SMS campaigns. By 2013 the report forecasts a change in this mix, with the majority of the spend being dedicated to search - projected as $567m to be spent on mobile display ads, $2.3bn on search, and $270m in SMS.

There is a slowdown in mobile ad expenditures at the moment due to the global economic crisis and the experimental nature of much f the current advertising, but spend is expected to rise quickly after 2010 with search seen as the more reliable and measurable focus for advertising as existing web users transfer more of their time onto mobile activity, particularly with local search advertising seen as a strong area for growth.

The adoption of mobile web usage and ability for advertisers to reach consumers on a mobile device is becoming easier through the increase of applications for the iPhone as well as other providers makes compelling content for a variety of handsets ubiquitous. Google is also making it easier for small businesses to advertise through the extension of Google AdWords to mobile.

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