Mobile Ad Options Expand, Incorporating Unique Device Capabilities

Source: eMarketer, FEB 20, 2013

Advertisers are leveraging mobile location and context data to better target consumers

Back in 2010, when Steve Jobs declared “mobile advertising sucks,” mobile advertisers’ options were largely restricted to static banners that in Jobs’ words failed to “engage and deliver emotion.”

While the static banner is still widely available and used, advertisers looking to engage mobile consumers on a more emotional level now have a menu of formats to choose from, according to a new eMarketer report, “Mobile Display Ad Types: Move Over Banner Ads, You’ve Got Company.”

eMarketer estimates US advertisers will spend $2.2 billion on mobile display advertising in 2013 and diversify investments across a wider range of ad formats.

What differentiates mobile ad formats is their ability to leverage the unique capabilities of the devices. Sensors can provide insight into the location and context in which consumers are using their smartphone or tablet, enabling a brand to increase the relevancy of its message. And touchscreen, camera, text messaging and other phone features offer multiple ways for a brand to engage the consumer.

The popularity of one mobile ad format over another has less to do with available inventory than with ease of use, scalability and the targeting capabilities associated with the format.

Facebook’s and Twitter’s mobile ad formats score high marks in all three areas and are becoming increasingly popular with both performance and brand advertisers as a result. Big-box retailer Wal-Mart, for example, deployed 50 million mobile ads through Facebook over Thanksgiving weekend to prime the 2012 holiday shopping season. In the spectrum of mobile ad formats, Facebook and Twitter ads stand out because their organic nature helps brands become a part of the content experience.

The demand for mobile video ads is also rising fast, encouraged by increased mobile video viewing, and mobile users’ preference for ad-supported streaming video content.

In addition to in-stream video, an expandable rich media banner ad that opens to what feels like an embedded website with a video player and interactive features is becoming an increasingly popular way for marketers to tell their story.

“We are doing more and more rich media ads, but we think it’s still an untapped market,” said Brian Colbert, vice president of mobile advertising sales for Pandora. “Whether you’re leveraging GPS functionality in maps or calendar functionality, you can do so much with the phones from a rich media perspective.”

Despite the increased availability and enthusiasm for more immersive and interactive ad formats, the direct-response focus among mobile advertisers is one reason static ad formats remain popular. For advertisers trying to drive immediate conversions, the static banner provides an affordable and scalable means of linking mobile users to an app store or a web storefront, or to trigger a phone call or text message, all of which can generate leads or sales.

The improvements in mobile ad inventory are one of the most important factors influencing pricing. Brand advertisers are paying premium rates to deliver immersive mobile experiences with rich media and mobile video formats. And overlaying targeting parameters can drive prices up further. Industry organizations such as the MMA and the IAB are creating mobile ad standards to facilitate the development and buying of these newer format types, which, given time, may ease prices of rich media and video formats.



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