Mobile advertising set for stellar growth

Global revenues from mobile advertising will hit $3.5bn in 2010, following strong growth in the last 12 months. Further growth is expected over the next five years, with the market set to generate around $24bn in 2015. But with major investments coming from the likes of Apple and Google, operators will lose out.

According to the latest research from Informa Telecoms & Media, over the five year period, the share of mobile advertising revenues for operators will fall from around 26 per cent in 2010 to an estimated 20 per cent in 2015.

There are an increasing number of successful mobile advertising campaigns taking place and a lot of market activity including in-house innovation, partnerships, mergers and acquisitions focused on growing consumer engagement on mobile. These developments are starting to provide the much-needed momentum that the mobile advertising industry needs, said Shailendra Pandey, senior analyst at Informa.

“The launch of Apple’s iAd advertising platform is forcing rivals to speed up their own mobile advertising strategies. Google has responded by acquiring AdMob and has announced it is on track to generate $1bn in revenues from mobile in 2010, a significant portion of which will be mobile advertising revenues. Google has also reported a 500 per cent growth in mobile search queries between 2008 and 2010,” Pandey said.

The mobile advertising industry has moved ahead from the trial and experimental phase and many brands are now spending significant sums on mobile campaigns on a regular basis. “The investments from big players such as Google and Apple validates the market opportunity, resulting in brands and agencies more actively considering mobile for their campaigns,” Pandey said.

Get more information on the report

In 2010, many mobile operators, including Orange, O2 UK, Movistar Spain, VimpelCom Russia, Maxis Malaysia and Claro Argentina, have launched services and trials to encourage their subscribers to opt in to mobile advertising and receive reward points in exchange for viewing ads on their mobile phones. It is becoming quite clear to the operators that close partnerships with other value chain players is essential and is a better strategy than attempting to build an in-house mobile advertising solution and their own creative and sales teams.

As a result, Informa believes that the mobile advertising market will go through a sustained period of consolidation over the next 12 to 18 months. The big value chain players have been on the acquisition trail for companies that will integrate seamlessly with their own platforms to ensure they have that end-to-end mobile ad-serving capability.