Uptake of Mobile Data Services Boost Prospects for the Mobile Ad Market

­The increasing adoption of messaging, mobile Internet, mobile video, rich application, mobile search, and a multitude of available data services, which can also be used to serve up mobile ads, is driving growth in the U.S. mobile advertising and search market. The rapid addition of new data subscribers and the increasing frequency of mobile data usage are generating a newer inventory that is then open to monetization. Mobile advertising projects a unique and compelling value proposition that continues to generate strong interest from key stakeholders.

Analysis from Frost & Sullivan finds that the market earned revenues of over $917.8 million in 2008 and estimates this to reach $2.8 billion in 2014.

"The promise of delivering highly qualified and targeted ads on a more personal device and even taking it a step further by enabling commerce from within the same ad experience is too strong to ignore," says Frost & Sullivan Industry Analyst Vikrant Gandhi. "The industry is 'smarter' due to the online experience, in which many industry participants initially disregarded the phenomenon only to find the early adopters managing to take up strategically important positions."

Innovative possibilities in mobile advertising make it a vital and attractive channel for advertising. There are multiple channels for advertising in mobile that can be leveraged to attain optimum effectiveness for the campaigns. The emergence of new solution types, such as an ad-mediation layer in mobile and third-party ad serving, are also helping the industry.

The biggest impediment is convincing the customers, particularly the advertisers and agencies, about the potential and capabilities of mobile advertising. The inherent benefits of mobile advertising must be showcased to project it as an exciting advertising vehicle, as proper marketing techniques will be the ultimate deciding factor for success. Aspects including ease-of-use, comprehensive reporting and feedback, subscriber interaction mechanisms, integration with existing online ad platforms, and others are crucial for sustaining long-term growth.

"It may not be enough to simply implement new platforms and wait for the 'buy side' to come in," cautions Gandhi. "The industry needs proactive measures to get more brands and agencies to include mobility as a core component of their marketing and advertising strategy."

Promoting greater brand participation is likely to remain a big challenge for the industry. Mobile advertising is perceived as not being very measurable. Other views that detract from its value are that it is cumbersome, spoils the user experience, and cannot tie into commerce. Attempts must be made to clear these misconceptions.

The industry has worked tirelessly over the past two years to make mobile advertising one of the most transparent, measurable, and intelligent digital advertising channels. It can be made a 'self-sustaining' process to a large extent, but achieving the desired scale will require close coordination among content providers. Educational seminars on the industry, trial offers, strategic marketing through webinars, and white papers are some suggested responses. The requisite technical elements to facilitate mobile advertising are already in place, but the need of the hour is to ratchet up interest levels of advertisers to trigger market growth.

Posted to the site on 22nd October 2009