By Chantal Tode
October 11, 2012
Mobile ad spend spikes as smartphone penetration grows
Marketers in Britain significantly increased their spend on mobile advertising during the first half of 2012, with the overall spend up 132 percent for a total of 181.5 million British pounds, according to a new report from the Internet Advertising Bureau UK.
The IAB UK compared the mobile spend for the same companies during the first half of 2011 with this year and found that display, video, SMS and MMS advertising on mobile devices increased by 91 percent for a total of 49.9 million British pounds. Additionally, mobile search grew by 152 percent for a total of 131.6 million British pounds.
“The biggest news was the huge growth that mobile saw, which was up 132 percent, outperforming most other media,” Alex Kozloff, senior mobile manager at the IAB UK, London.
“In H1 2011, mobile made up two percent of digital ad spend and in 2012, it was up to seven percent – that is great news for mobile,” she said.
“What surprised me was that every single format saw significant growth. One that really stands out was mobile video - it started from a relatively small base in 2011 and is up to 1.7 million pounds in H1 2012.”
Overall, mobile accounted for seven percent of all digital ad spend, up significantly from last year.
One of the important driving factors in the growth of mobile advertising is smartphone penetration, with 58 percent of the British population owning a smartphone as of June 2012. Additionally, the average British household’s broadband speed is 9MB and social media accounts for one-fifth of all Internet time.
The group also estimates that the ad spend on tablets was at least 2.4 million British pounds in the first half of 2012.
Overall, digital advertising spend increased 12.6 percent to a record six-month high of 2.59 billion British pounds, according to the report.
Other key findings include that the consumer goods sector joins the finance sector at the biggest spenders on digital display advertising. Spend by consumer goods advertisers increased across all digital channels as these advertisers increasingly recognize the brand-building potential in online and mobile platforms.
The group sees significant upside growth potential remaining in mobile as 60 percent of Britain’s 100 biggest advertisers still do not have a mobile-optimized Web site. This in spite of the fact that consumers spend almost 70 percent longer on sites which are optimized for mobile.
“There is still potential for growth in mobile marketing,” Ms. Kozloff said. “We are at about 60 percent smartphone penetration in the UK – that highlights a gap in consumer usage versus marketing spend so there is definitely potential to grow.
“All the formats are growing so it is not enough to just do mobile search anymore,” she said. “It is important to have a presence on mobile because consumers are using these devices heavily.”
Chantal Tode is associate editor on Mobile Marketer, New York