Mobile advertising spend to rise 80 percent in 2010: Study

By Rimma Kats

March 17, 2010

Mobile advertising is going to break out in 2010, with average spend increasing 80 percent, but some publishers are struggling to participate in the boom, according to Mojiva.

In a recent survey conducted by DM2Pro.com and Mojiva, nearly 1,000 agencies, brand advertisers and publishers chimed in. The survey projected a significant hike in mobile ad spending.

“Agencies polled represented that the average individual client spending would see an 80 percent increase,” said Melinda Gipson, publisher of DM2PRO.com, Royaton, CT. “On average across their business, they see a ramp up of 65 percent and for brands, the prediction is that spending will more than double

“What's surprising about this is the consistency of responses here,” she said. “When you take out the agencies that are staying level or decreasing their spending by 1 percent, only 6 percent of respondents are decreasing their mobile spending.

“When's the last time you saw 94 percent agreement in the ad agency world on anything?”

Mojiva is a mobile advertising platform for advertisers and publishers who want to get into the smartphone market.

DM2PRO.com is a membership site for digital media and marketing professionals who want data, case studies and information on mobile media.

Mobile future
According to several agencies, client spending was pegged at $143,000 on average last year and $260,000 this year, which represents an 80 percent increase in spending.

Additionally, agencies predicted that its client spending would increase by 65 percent for 2010.

Brands predict that mobile advertising spending will double, from an average budget of $269,000 in 2009 to $679,744 in 2010.

In addition, more than 67 percent of publishers sell mobile separately, but for an overlapping 65 percent, mobile can either be bundled or included as a value-add in other media sales.

Only 24 percent of mobile publishers sell out more than half their inventory.

“There's a rapid influx of newbies into mobile marketing,” Ms. Gipson said. “Their spending is still quite small.

“This is to be expected, but when you look at the more tenured marketers – those spending six figures already, and the much larger increases they're forecasting, you'd have to conclude that, once you crack the code on mobile, the ROI must be phenomenal to justify that level of increases that marketers are projecting here,” she said.

“Even those who haven’t done mobile marketing at all look to be putting 10 percent of their total spend into the category. This seems like a large leap to take – sort of like going from 0 to 60 in 10 seconds.

Advertising strategy
According to DM2Pro.com, many brands have not done mobile marketing because they claim they need a better strategy.

The company claims that the data it collected from respondents should be helpful to businesses in making the right strategic decisions.

“With all this money headed into mobile marketing, many publishers still have difficulty capitalizing on this influx,” Ms. Gipson said. “It sounds self serving, but clearly, those who do, seem to be those that effectively use mobile ad networks.

“For example, publishers who use mobile ad networks say they account for more than 60 percent of revenue,” she said. “2010 is the year mobile breaks out of single digits for brand and agency marketers.

“Total overall mobile spending is small, but will begin to represent a growing subcategory of online spending for most, and a key, dedicated channel for many others who've already found it successful.”

Comments on "Mobile advertising spend to rise 80 percent in 2010: Study"

1. Stampa foto says:

   February 11, 2012 at 12:06pm

   Exist an update of this report?

2. Mike Kemp says:

   July 27, 2011 at 2:35am

   While 80% seemed wildly optimistic at the time it turned out to be actually less than the final tally! Mobile advertising seems to defy all business logic for expansion during a recession and it doesn't look to be slowing down anytime soon.

3. Nelson Mclester says:

   July 11, 2011 at 5:53am

   The results thus far indicate budgets for mobile marketing spend is set to rise 124% from 2010 to 2011, putting the total allocation to the mobile channel at roughly 4% of overall marketing budgets. Mobile as a marketing channel is up by the greatest single percentage, with “events and trade shows” the only other channel that’s projected to see growth in budget totals, surprisingly enough.

4. Scott was here says:

   June 15, 2011 at 6:42pm

   I like this line in the article; “When's the last time you saw 94 percent agreement in the ad agency world on anything?”
   The truth is, how often do you get 94% agreement on anything!
   The other truth is that mobile is going to be huge in the future!

5. Ed Frazier says:

   May 16, 2011 at 11:06am

   Now doubt Mobile is taking over a lot of the search functions that once were the domain of Google. The trends are mobile is going to be a disruptive technology.

6. Abbigliamento sportivo Lib says:

   April 17, 2011 at 11:13am

   Interesting study... I'll make good use of those information. Thank you.

7. tiffany uk tiffany uk says:

   March 1, 2011 at 5:49am

   This article was very helpful to me as I am working on a consulting assignment and needed the latest forecasts for Online advertising. I need to take it one more step. Can you help me to fill in the the blanks or direct em to someone that can help? Thanks DEF
   
   Analysts expect global online advertising to reach $81 billion by 2011 (fact check), representing a ___ % CAGR from ____ to ____.

8. John Davis says:

   January 11, 2011 at 11:35am

   This is a great post. Very analytic.

9. Julie Spence says:

   January 4, 2011 at 4:42pm

   This article was spot on!

10. Cheap Satellite says:

    December 15, 2010 at 10:35am

    As more and more people change to a 'smart phone' the mobile advertising market will continue to grow because of the sheer amount of people searching/surfing on their mobile devices. I have a fear it could inflate local advertising expenditures greatly. Nice insights.

11. Jen Stegen says:

    December 8, 2010 at 10:27pm

    Mobile marketing is the next big thing. It was only a matter of time before more is spent on it.

12. Matt Kent says:

    October 22, 2010 at 2:58am

    Mobile technology is flooded in the market place. We are now near the end of 2010 and I am convinced even more that consumers just cannot keep up with the influx and they are increasingly confused with the application extras and potential benefits. Equally, some consumers are attempting to buy a one fit, for all applications and this is just not feasible for a mobile device. The technology for batteries is, in my opinion, lagging behind the available applications. Of course, the market remains afloat, as key providers such as Apple are secure due to their band reputation. 2011 will be an interesting year for not only the mobile technology but also the general marketing approaches and methods.

13. Called. com says:

    October 15, 2010 at 5:34am

    There is nothing surprising to see that mobile advertising is breaking all records and will rise to 80% in 2010!! The are so many new brands of mobile phones being launched in the market these days that there is so much of competition and the whole benefit is going to the mobile users who can have their pick and great leverage to buy the best set that they possibly can afford!! Let us hope that they are new good sets being introduced in the market which means that it will give a better choice for the buyers and for the general improvement of the economy of the country!!

14. Shared Shares says:

    October 6, 2010 at 7:13am

    The results thus far indicate budgets for mobile marketing spend is set to rise 124% from 2010 to 2011, putting the total allocation to the mobile channel at roughly 4% of overall marketing budgets. Mobile as a marketing channel is up by the greatest single percentage, with “events and trade shows” the only other channel that’s projected to see growth in budget totals, surprisingly enough.