Forecast/Sales | Mobile | News

Mobile Ad Revenue Spikes

An Adidas ad on YouTube.
An Adidas ad on YouTube.

OCT. 10, 2013 • Advertising revenue on mobile devices in the United States grew to $3 billion during the first six months of 2013, according to the Interactive Advertising Bureau – an 145% increase in mobile ad revenue over the $1.2 billion generated during the same period last year. Internet advertising revenue overall increased from $17 billion during the first half of 2012 to $20.1 billion for the same period this year.

Impact: Despite the growing popularity of smartphones worldwide, actually translating that penetration into the consumer market into significant ad revenue has not been a given. Until this year, Facebook, for example, was under severe criticism for not being able to monetize the growing number of users accessing the social network via mobile devices. It now appears that marketers have turned that corner with mobile ad revenue now accounting for about 15% of the total online take. That is still a smallish percentage given the millions of smartphones in circulation, yet we think the breakdown should even out substantially within the next three years. The big news is that this ascendant mobile advertising no longer seems to be antagonizing consumers as it once did. Part of that is a result of the growing selection of free entertainment apps in which the trade-off between free play and advertising is more acceptable. Now the question seems to be not whether there is advertising tied to an app, but how brazen the placement is.  That’s a big leap and one of the reasons why mobile ad revenue is on the rise.

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