Mobile Ad Spending Surpassing Expectations
Following the release of the iPhone 7, it comes as no surprise that mobile ad spending hit an all-time high in 2016. For the two competitors, iOS and Android, both saw a recent spike as the costs associated with mobile advertising are increasing.
The indexes, cost per thousand impressions (CPM) and the average cost per purchaser (CPP), saw significant growth as CPM grew 26% for iOS and 6% for Android, while CPP was up 40% on iOS and 65% on Android. The recent surge is likely due to the launch of the iPhone 7 for iOS and Android becoming easier to target users for marketers than on iOS leading to lower CPP Index. Although Samsung’s exploding phones played a leading role in the drop in mobile ad spending for September, Android has had a nice rebound since.
The expectations for mobile ad spending is it will continue to rise as consumers are spending more time on their mobile devices and marketing campaigns are taking notice. It’s also important to note that with new innovative ad tech and higher engaging advertisements on the market, such as playable ads, mobile ads will have higher CPM resulting in lower CPP. This has forced marketers to become creative in order to reach their target audience effectively, which has seen improvements during campaigns throughout 2016.
Between April and June 2016, Over 40,000 US mobile campaigns were analyzed showing that mobile campaigns reached 60% of their target audience. According to Nielsen, this is up from 49% during the same period of 2015. The rate of successfully targeted ads on mobile and desktop is now equal, but with mobile campaigns becoming increasingly popular it is expected for mobile to overtake desktop. In 2015, marketer’s advertising budget toward mobile was up to 12% from 4% of ad spend in 2013. More significantly, mobile accounted for 47% of total ad revenue in the first half of 2016 up from 30% in the same time frame in 2015. Mobile ad spending shows no sign of slowing down.
According to eMarketer, mobile-app-install ads in the U.S. will generate nearly $6 billion in marketing spending in 2016. As mobile-app-install ads continue to rise on various platforms and their being more emphasis of marketer’s ad budget directed towards mobile, it will be important for marketers to not only create an effective ad but also an efficient one with the intent to increase their reach for target audience.
Source: Mayo Seitz Media, December 2016
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