USA Mobile Local Ad Revenues to Reach $4.5 Billion in 2014

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The USA's mobile local advertising revenues are expected to reach $4.5 billion in 2014 up from $2.9 billion in 2013 according to BIA Kelsey. In its Annual U.S. Local Media Forecast (2013 2018) the firm projects mobile local ad revenues to more than triple over the next five years reaching $15.7 billion in 2018.

According to the forecast, total U.S. mobile ad spending will grow from $11.4 billion in 2014 to $30.3 billion in 2018. By the end of the forecast period, locally targeted mobile ads will represent 52 percent of overall U.S. mobile ad spending.

Driving this localized share of mobile ad revenues is the adoption of mobile local advertising tactics (i.e., geo-fencing, click-to-call, click to map) by national advertisers, who currently account for most U.S. mobile ad spending, and who are expected to take advantage of increasingly available and currently undervalued mobile local ad inventory.

"Advertiser demand will be driven by natural market forces to follow undervalued inventory," said Michael Boland, senior analyst and VP of content, BIA/Kelsey. "Mobile advertising's appeal includes higher performance, clearer ROI, tangible conversions and a shorter purchase funnel. These qualities of mobile content and advertising present a rare alignment between typical mobile user intent and advertisers' stated objectives."

Mobile Local Media Forecast by Format

This forecast comprises various mobile ad formats, including textual search, display, video, commercial SMS and native social advertising.

Search advertising currently holds the largest share, followed by display and native social ads. Search's dominant share indexes higher within this localized segment than within the broader of U.S. mobile ad revenue total, due to the high correlation between mobile search and local user intent. There is conversely a lower percentage of localization within the display category, due to the branding (as opposed to direct response) and reach-driven objectives inherent in display campaigns (i.e., in-app ads).

The forecast includes a breakdown of mobile local ad spending by format as follows:

  • Search (advertising applied to search queries on mobile devices) will grow from $4.3 billion in 2014 to $10.9 billion in 2018.
  • Native social (visual and textual brand messaging merged into organic feed-based interfaces of mobile social apps such as Facebook and Twitter) will grow from $3.3 billion in 2014 to $9.9 billion in 2018.
  • Display (display advertising applied to app and mobile Web inventory) will grow from $2.4 billion in 2014 to $6.1 billion in 2018.
  • Video (rich media ad units distributed within app and mobile web inventory) will grow from $1.1 billion in 2014 to $3.1 billion in 2018.
  • SMS (commercial SMS messaging) will grow from $332 million in 2014 to $381 million in 2018.

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Tags: mobile advertising  USA 

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