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Mobile ad revenues jump 76pc as everyday use grows: IAB

Marketers? spend on mobile advertising reached $5.3 billion in the first half of 2014, up from $3 billion during the same period a year ago, according to a new report from the Interactive Advertising Bureau. 

The IAB?s Internet Advertising Revenue Report reveals that marketers spent $2.7 billion on mobile search in the first half of 2014, $2.5 billion on mobile display and $103 million in other mobile formats. This is the first time that the IAB report has separated out mobile ad revenues by tactic. 

"I think it is very significant [that mobile ad revenue now accounts for close to one-quarter of digital ad revenue],? said David Silverman, a partner at PwC US, which partnered with IAB on the report. ?It is indicative of how and where people are accessing online media and how it has become naturally part of our everyday life and is not dependent on being connected to a cord."

"Since we haven't had breakout detail within mobile for historical periods, we don't have a quantitative answer to [which mobile tactics are growing fastest],? he said. 

Social revenues up
Overall, Internet ad revenues reached a high for the first half of the year with a total of $23.1 billion, up 15 percent from the same period a year ago. 

The IAB also found strong growth in social media revenues, which reached $2.9 billion, up 58 percent from the same period a year ago. 

With the second half of the year typically delivering stronger ad revenues than the first half, the IAB expects the momentum in mobile to continue through the end of the year. 

While marketers are ramping up their spend in mobile, many are still struggling to figure out the best way to proceed in mobile. 

Mobile-savvy consumers
Earlier this month, the IAB?s third annual international anthology of mobile perspectives, which analyzed data from IABs in 30 countries, noted that regardless of the place, consumers lead the way, leaving media companies, agencies and brands puzzled by mobile or unsure how to respond to the shift of the digital audience to phones and tablets. 

Those findings underscored the need for marketers to get up to speed in meeting the demands of increasingly mobile-savvy consumers (see story). 

In August, the IAB, in collaboration with IAB Europe and IHS Technology, reported that global mobile advertising revenue in 2013 soared 92 percent from a year earlier, reflecting mobile?s adoption as an essential marketing element. With a 215 percent year-over-year surge in Latin American mobile ad revenue growth leading the charge globally, worldwide mobile ad revenue rose to $19.3 billion last year from $10.1 billion in 2012 (see story). 

A surge in programmatic trading is supporting the growth in mobile ad revenues in Britain, IAB reported earlier this year. 

Programmatic trading accounted for more than a third of mobile ad buys in Britain last year and is playing a bigger role for smartphones and tablets than for digital display ads overall, according to research scheduled to be released today from the Internet Advertising Bureau. 

While programmatic trading accounted for 28 percent of all digital display ads, it accounted for 37 percent on mobile, the Media Owner Sales Techniques study found (see story). 

"Broadly, we are seeing mobile revenue increase as advertisers strive to meet customers where they are consuming media -- on their mobile devices," Mr. Silverman said. "So, more than anything, this is about mobile growth, and not necessarily mobile search or mobile display. 

"That said, within mobile, display and search are clearly the drivers," he said. "Part of the explanation for this is definitional: mobile display consists of several formats, including banner ads, digital video, digital audio, sponsorships, and rich media. 

"And part of the explanation is the relative ease of porting from the "old" to "new" platform: mobile search is less dependent on screen size than other formats that require new ad units and creative, so it benefits from a relatively simple port."

Final Take
Chantal Tode is senior editor on Mobile Marketer, New York