Mobile advertising is a type of advertising done on mobile devices, such as smartphones and tablet computers. This digital advertising channel came to exist as recently as five years ago, following the rapid adoption of smartphones and other high-tech mobile devices by consumers. As a result, mobile advertising is becoming a darling of the advertising industry.
In the UK, one in three households own tablets. The large number of households with tablets means brands can no longer ignore this new medium of communication. Digital marketers and brands are now beginning to take mobile advertising more seriously
Rise of mobile as a key part of brand advertising
Not too long ago people mocked the Android mobile operating system (OS), suggesting it would not have a chance in the market. However, not only has Android taken the lion's share of the mobile OS market, but also become the leader in mobile ad impressions with up to 71% of mobile applications developed for Android. The increasing popularity of mobile devices and emergence of competing mobile OS like Windows OS, Mac OS and iOS reassure that mobile advertising is not another fad.
People today just don't need desktops as much as they once did. They are turning to tablets and smartphones to fill in for the older devices like laptops and desktops. And, with introduction of superfast 4G mobile networks that offer speeds of up to 60Mb/second in the UK, using mobile devices to make calls, text and even browse the Internet is now a breeze. New mobile products like Google Glass and smartwatches guarantee mobile ads will remain a key part of current brand advertising strategies.
Push for new digital ads
Traditional ads like the banner ad can be a joke on the smaller screens of mobile phones. Expect to see new ad formats being introduced for mobile devices in the coming years to address this problem. Many new ad formats are already being pushed for mobile devices, including rich media tap-to-expand ads and mobile videos ads. The new digital ad formats are designed to offer better engagement and increased opportunities for advertisers. Mobile video ads, for example, are gathering momentum and should keep growing in coming years with faster connection speeds and increased data limits.
It is unlikely that the traditional 30 second video ad format used on desktops will still be used across different mobile devices going forward. This is because people generally don't spend a lot of time consuming content on smartphones and other mobile devices. Instead, brands will create newer and shorter video ads (about five to 10 seconds long) to display on the different mobile platforms. This will ensure video ads are more effective. Vine and Instagram Video are already using shorter length mobile video ads with encouraging results. Expect the trend to continue and catch on in the near future.
Evolution of ad buying and selling models
As people's attitudes change and mobile advertising becomes more effective and lucrative, the way the ads are bought and sold is bound to change. Cost per View (CPV) and Cost per Engagement (CPE) ad payment models will become the main ad buying and selling models, while the Cost per Mille (CPM) will fade into the background. This trend is already evident in 2014 and should continue as an increasing number of brands realize that it is not the quantity of ad views that counts, but the quality of ad views.
Advancements in mobile payment technology coupled with increasing number of companies that understand quality of ad views counts more than quantity of views means that more brands will adjust their spending budgets and allocate more money to mobile advertising. This trend will continue probably at the expense of other advertising channels like display, print and TV advertising. Advertisements that are optimised for quality engagement on mobile devices will also cost more and bring better results.
Projections indicate mobile advertising is here to stay and will grow in importance over time. If you are wondering whether the banner ad will still be effective for digital marketing in over the next few years, don't worry too much about it. Banner ads are not disappearing any time soon. People will continue to use desktops and laptops, particularly for work. However, publishers need to adapt and optimise their websites for mobile technology to take full advantage of the monetisation opportunities brought by the medium. Similarly, marketers and brands will need to figure out how to effectively utilize the opportunities presented by mobile advertising to boost their bottom line and achieve business goals.