These days, without even considering mobile advertising as an option as a marketer, you may find yourself in a bit of a rough spot. That is to say, you probably will not be doing quite as well as others, since mobile is quickly shaping up to be a leading platform for advertising. Soon, spending on ads for mobile devices will be higher than anyone could have imagined only a few years back, and the digital advertising world will be taking a slight turn toward handheld devices. In fact, a new study from BIA/Kelsey predicts a 54% growth in mobile local ad spend by the year 2016. Although not quite as large as some of the other predictions made about growth in ad spend, this number is a realistic forecasting.
To look closer at the big picture, in 2011 local mobile ad spend represented about 0.6 percent of the total. In the even that BIA/Kelsey’s prediction was to become true, mobile would represent upwards of 3 percent of total local ad spend by 2016. That is quite a jump in just five years, and with mobile growing so rapidly all over the country, there could be a chance that it could exceed the company’s expectations slightly.
Do not get confused though, for these numbers do not represent the national ad spend. However, the company did predict that mobile local ad spend would beat out national ad spend by 2016, passing it in growth rates. In four years, BIA/Kelsey has predicted that mobile local ad spending will make up about 58 percent of total ad spend, and that mobile ad spending will reach about $9.92 billion in 2016.
What will cause this rapid mobile growth? Well Michael Boland, program director of mobile local media at BIA/Kelsey tells us some of the factors that will have an impact.
Growth drivers include smartphone penetration, location data, ad targeting innovation and advertiser evolution to utilize these factors for higher-performing mobile local ad campaigns. New mobile ad formats will also drive demand including Facebook’s quickly evolving options like sponsored stories and app install ads – currently accounting for 14 percent of Facebook’s revenues and quickly growing.
Local mobile ad spend has already begun catching up to national mobile ad spend, as BIA/Kelsey’s study shows that in 2012, $1.2 billion was spent on local mobile advertising, while $1.5 billion was spent on national mobile advertising. The company expects local mobile ad spend to surpass national ad spend by the year 2014, and then continue to grow its lead from then on.
So, it would appear the BIA/Kelsey is very confident in their prediction that by 2016, the local mobile ad spend will equate to upwards of $5.8 billion, 58% of the total mobile ad spend in the country. Local advertising is constantly getting larger and more recognized by advertisers, while at the same time mobile platforms continue to grow. Therefore, these predictions are understandable and quite reasonable, as long as local mobile ad spending continues toward the direction in which it is already headed.
