Global revenue from mobile advertising should reach US$ 11.4 billion by the end of 2013, according to a new Gartner forecast. That figure is up from US$ 9.6 billion last year and is expected to total US$ 24.5 billion in 2016.
Looking at mobile ad revenue trends by region, Asia-Pacific/Japan will continue its status as the largest generator of mobile ad dollars with a leading US$ 4.3 billion last year expected to grow to almost US$ 4.9 billion this year and US$ 9.5 billion in 2016. Gartner credits an early lead in mobile content consumption by users in South Korea and Japan, as well as the burgeoning mobile markets in China and India, as driving this trend.
However, Western Europe (US$ 1.6 billion in 2012) and North America (US$ 3.2 billion in 2012) will significantly close the gap with Asia-Pacific/Japan by 2016, when Western Europe is expected to generate $4.4 billion in mobile ad revenue and North America will generate almost US$ 8.9 billion.
Search Drives Mobile Ad Growth, ‘Bubble’ May Burst
Gartner identifies mobile search as the biggest single driver of mobile ad revenue growth during the upcoming period of expansion. However, Gartner also believes that mobile display ad spending will eventually generate more revenue than mobile search ad spending and also forecasts Web display spending to outgrow in-app display spending by 2015.
Another developing trend Gartner sees is the increased time consumers spend on their mobile devices leading to more ad inventory than advertisers can fill, driving down unit costs and attracting app developers to post cheap “paid discovery” ads. Gartner cautions this artificially low unit price may be producing a growth “bubble” that will burst as more advertisers start buying inventory.
Other Signs Point to Mobile Ad Boom
Mobile Advertising Hub offers several figures, including one from Gartner, that also suggest a mobile advertising boom is underway. According to a posting on the blog, the market for mobile devices is expected to reach 2.6 billion units worldwide by 2016 and the volume of mobile traffic to Facebook increased from 8 percent in 2008 to 33 percent in 2011. Furthermore, Gartner statistics indicate the total number of mobile app downloads (free and paid) will grow from 17.7 billion in 2011 to more than 108 billion in 2015.
Facebook Takes Lead in Mobile Display Ad Revenue
Recent estimates from eMarketer indicate Facebook was expected to take a leading 18 percent of net US mobile display advertising revenue during 2012. This gives Facebook a narrow lead on previous leader Google, who will still maintain a strong second place standing with 17 percent.
Other leading US mobile display advertising providers for 2012 include Pandora (12 percent), Twitter (7 percent) and Apple (6 percent). Interestingly, eMarketer sees Facebook’s US mobile display advertising share increasing to 25 percent next year while Google’s share also grows to 19 percent and then drops to 22 percent in 2014, allowing Google to overtake it again with a 23 percent share.