Half-Year Status Check: 5 Trends Driving Mobile

As we round the corner on 2o12’s half-way mark, the mobile local space continues to move rapidly. Following our January predictions (some of which have already come true), we took some time to now revisit the biggest trends driving mobile local media.

They’re broken down in my monthly Street Fight column which you can see in full here, and an excerpt below. These are the trends happening all around us and most recently explored at our Mobile Local Media SF conference.

We’ll expand this list in a BIA/Kelsey report in the works. In the meantime, here’s a taste.

1. Mobile Ad Revenues Take Off

A forecast I recently put together predicts U.S. mobile ad spending will go from 1.7 billion last year to about 7.7 billion in 2015 (affirmed recently by the the IAB). This is partly due to evolving mobile usage patterns and smartphone penetration. The latter just passed 50 percent of all U.S. mobile subscribers according to Nielsen.

There are also some interesting dynamics unfolding with the economics of mobile ad rates. Mobile usage is outpacing advertiser demand, so you see greater supply of ad inventory than ad spend. So ad rates such as CPMs and CPCs are going down. We believe that trend will continue, but will normalize at a certain point over the next couple of years as advertiser demand picks up.

2. Local Dominates Mobile

Breaking down the top-line mobile ad revenues mentioned above, the dollars going toward location targeted ads will be a major driver. They will go from just under half of mobile ad spend to almost two-thirds by 2016.

This will result foremost from usage: Google reports that 40 percent of mobile searches have local intent, and that compares with only 20 percent of desktop searches.

Advertisers are slowly coming around to that reality and building campaigns that are more geo-centric. Premium ad rates will meanwhile develop based on the higher performance of location targeted mobile ads, which we’re already seeing.

But questions remain about “what is local” as localized mobile ad campaigns have varying and sometimes lacking levels of local granularity.

Continue reading

This Post Has 2 Comments

  1. Landscaper

    Great article Mike!

    It really demonstrates how Local players need to be integrated with (or thinking of) the big two main mobile ecosystem owners: Google and Apple.

    40% of mobile searches have local intent. That is huge!

    Providing payment gateways/tools is going to be integral, and a huge money spinner for whoever introduces those gateways to the SMB’s.

    Google’s Glasses are a massive game changer! And now there are rumours that Apple is working on a similar project too.

  2. Lisanne Powers

    Mobile apps for conferencing will see significant growth and consumption over the next five years. Organizations can increase productivity, and realize significant cost savings with mobile apps that offer global reach, and access from multiple operating systems and devices. We’re seeing significant interest in mobile apps for conferencing, especially with flexible work spaces, and younger workers, http://networkingexchangeblog.att.com/enterprise-business/dont-be-like-theodore-a-technology-dinosaur/.

Leave a Reply

Your email address will not be published. Required fields are marked *

eleven − ten =

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>