Does mobile advertising merit $1.8 billion in 2012?
U.S. mobile ad spending will jump by 47% to hit $1.8 billion in 2012, according to estimates from eMarketer.
Search and banners/rich media will receive most of marketers' mobile ad dollars with eMarketer pegging advertisers to drop $594.8 million on each channel next year. Messaging, this year's biggest benefactor of mobile ad dollars, will follow at $508.3 million, and video will trail at $104.5 million.
Question is, does mobile merit the cash influx? Yes if mobile ad technology improves; no if it doesn't.
(Briefer discussion of whether mobile merits next year's projected spending growth: Yes because more consumers will have smartphones next year. Therefore, mobile ads will have a broader reach and advertisers will be paying more either in order to reach those consumers or because they have reached those consumers. It's called math.)
AOL is one company that is looking to grow the mobile ad space, according to The Wall Street Journal. Problem is, AOL's mobile strategy seems to be more of a revenue grab than a legitimate investment.
While the Journal mentions that AOL “is revamping its digital advertising technologies to make it possible to sell and measure the effectiveness of ad campaigns that appear both on the Web and in mobile,” the only details the article provides point to AOL's inflated ad rates.
From “a recent sales pitch presented to advertising agencies that was viewed by The Wall Street Journal”:
The document lists the pricing for its Editions iPad application, which launched in August and has registered more than 100,000 downloads, as $150,000 for four weeks, with a four-week minimum ad buy required.
Ad rates for AOL's Huffington Post iPhone and iPad apps are $35 per thousand views.
The Journal adds that the cost per thousand reviews for ads on AOL's non-mobile sites averages $7, according to research firm SQAD WebCosts.
I wish numbers were available to directly compare ad rates on HuffPost's desktop site with those for its mobile apps. But even without them, I don't expect the desktop rates to be such an outlier as to rival the mobile rates. Therefore, AOL is saying that mobile eyeballs are more valuable than desktop eyeballs. No way — at least not yet.
As it stands, it's too easy to ignore mobile ads unless you're playing Angry Birds (in which case you get angry at AdMob for placing ads that obstruct the game). It's arguably easier to ignore mobile ads than to ignore desktop ads, if only by function of a smartphone's pinch-to-zoom or tap-to-zoom capabilities. For example, if I'm reading a news article on my Android phone, I can double-tap the text and have the page resized so the only viewable content is the article copy.
Outside of a mobile app, I can't recall the last time I saw a mobile search or display ad. I'm sure they've been there, but unfortunately for the advertisers and their mobile return on investment, my eyes have not been. I don't think that will remain the case, but it'll take more than obese ad rates and proclamations regarding the importance of mobile.