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Top 10 Mobile Advertising Trends to Watch

Written by: Laurie Cutts, Director of Marketing

As a marketing channel, mobile isn’t going anywhere. With over 14,000 different smart devices and tablets, it’s safe to assume that smartphones and tablets are here to stay. Inevitably, where consumers go, advertising follows so if you’re looking to drive conversions, it’s essential to understand how people are interacting with your messaging and content while using their mobile devices.  To help advertisers make sense of it all, we’ve identified the top mobile trends you should keep in mind as we head into the busiest time of the year.

1. Mobile adoption is ridiculously fast.

Smartphones have spread faster than any consumer technology in human history, reaching market maturity faster than radio, TV, the commercial Internet and many other devices and technologies. According to Nielsen, 61% of US mobile subscribers now own a smartphone. This trend isn’t exclusive to the US. By the end of 2012, several markets worldwide reached a key milestone with over half of mobile phone users in five other countries—South Korea, Norway, Sweden, Australia, and the UK, having made the switch from feature phones to smartphones.

2. Android vs. iPhone.

Android vs. iPhone is the topic of endless debates, studies and blog posts. Android phones have quickly gained market share in recent years and outpaced iPhone. In the US, sales of Android phones continue to lead iPhone 53% to 38% according to Comscore’s latest MobileLens study. Worldwide, Android’s dominance is even more pronounced. According to IDC, Android had more than a 70% market share as compared to 21% for iPhone. Cost effective smartphones from Huawei and ZTC have helped drive this trend in emerging markets.

3. One-third of US adults own tablets.

Tablet penetration has doubled since 2011. A third (34%) of American adults now own a tablet computer and a majority (56%) of them are in higher income households. With their ease of use and high quality user experiences, tablets are often used in people’s homes whereas smartphones are typically used on the go. Where smartphones are personal, tablets are social, with Forrester Research finding that 50% of tablet owners share their device with family and friends.

4. Tablets are the new PC.

time_spent_mediaEvidence suggests that the PC to Tablet shift is already underway when it comes to consumers replacing their devices. IDC reported a 14% drop in PC and laptop sales in the first quarter of 2013, and by 2017, it’s expected that tablet shipments will exceed PC shipments.

It’s not surprising that consumers are attracted to tablets; they offer greater portability and are attractively priced. eMarketer reported that 84% of users are comfortable using tablets for doing things that they used to do on their laptops. And for the first time this year, time spent on non-voice mobile activities surpassed time spent online on desktop and laptops. Their latest study revealed that US adults will spend 43% of their time with digital this year — 19.4% on mobile—compared to 19.2% on laptops and PC’s.

5. Smartphones are for shopping. Tablets are for buying.

Consumers are using their smartphones and tablets differently when it comes to shopping. People rely on their smartphones to assist them with their shopping and their tablets for browsing and buying. According to latest research from eMarketer, 78% of smartphone owners shop but only 39% of them buy. This is in contrast to tablets where 84% of owners use them to shop and 63% of them buy. Tablets are associated with higher purchase values and they are expected to drive the rise in higher value “couch and pillow” commerce representing 72% of Mcommerce sales by 2017.

6. Global mobile advertising revenues are surging.

Although advertisers are still figuring out mobile, the good news is that revenue from mobile ads is escalating globally. A study from the Interactive Advertising Bureau (IAB) revealed that mobile ad revenue around the world increased a staggering 82.8 % to $8.9 billion in 2012 from $5.3 billion in 2011. Here’s a breakdown by region.

  • Asia-Pacific: 40.2% ($3.558 billion)
  • North America: 39.8% ($3.525 billion)
  • Western Europe: 16.9% ($1.499 billion)
  • Central Europe: 1.3% ($112 million)
  • Middle East & Africa: 1.2% ($109 million)
  • Latin America: 0.6% ($50 million)

Growth was strong across the board in each region. North America had the biggest jump with a 111% increase from 2011 to 2012. The biggest factors for the revenue increase were huge smartphone adoption, more 3G and 4G penetration, and better targeting. One company that has seen incredible mobile growth is Facebook. The social network now controls approximately a quarter of all mobile display revenues.

7. Tablet ad spend outweighs smartphone ad spend.

Mobile advertising is exploding but the money is pouring into tablets at a much faster rate than smartphones. According to a forecast by Deloitte, in 2013 tablets will generate $4.9 billion in advertising revenue compared to the nearly $3.4 billion for smartphones –and this gap is expected to grow wider.

8. Advertise locally.

According to eMarketer, smartphone and tablet users are most likely to click on ads that are locally relevant.  It’s essential for advertisers to take advantage of the unique attributes of mobile including location targeting and highly personalized ads. Location-based targeting will accelerate as more advertisers take advantage of the locative technologies in many smartphones.  “Geo-fenced” mobile ad campaigns are a good place to start, serving offers only within specified areas around certain store or points of interest.  Retailers that want to take it a step further can use dynamically updated product data to inform customers about in-store availability.

9. Consumers use multiple devices to make a purchase.

multi-device-purchasingWith customers carrying out their purchase decisions in complex and unique ways, savvy marketers are coordinating their presence and integrating their campaigns across multiple devices. There are two primary modes for what is called “multi-screening.”

  • Sequential screening is when people move between different devices.
  • Second screening is when people use their smartphones or tablets while watching TV or another device.

With sequential screening, smartphones are frequently the starting point. They allow consumers to easily shop at home or on the go while tablets are typically used at home for leisure based activities like shopping. A Google study on the multi-device path to purchase showed that 65% of consumers start shopping on their smartphone and then continue to purchase on either their PC or Tablet.

10. Showrooming and ROPO.

Two additional phenomena caused by the proliferation of mobile devices are ‘showrooming’ and ‘ROPO’.

  • Showrooming is when consumers view products in the store before purchasing them at a lower price online.
  • ROPO is when people research online and purchase offline.

These two trends are having a massive impact on every day sales.  Although purchases online have not overtaken offline, customers are increasingly going to their mobile devices before purchasing a product.  Retailers need to take into account this customer behavior because it is important to make an impact online to ensure their products are purchased offline. Savvy retailers are aligning touch points throughout all their channels, including offline advertising and promotions, mobile apps, social media and online websites.

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