Many of you probably know about the yearly Internet Trends report that comes out from Mary Meeker. There is always a lot of thought-provoking information in there, and if you are interested in macro trends and their potential impacts, that’s a great place to start.
One area she covered is mobile advertising. Given that mobile is an on-ramp to the internet, and by many estimates access to the internet via mobile devices is past 50% now compared to access via desktop, it makes sense that internet models of making money would or should become prevalent in the mobile world. After all, websites are now designed specifically for mobile devices in addition to desktop, so why wouldn’t desktop internet models of making money also apply? That’s not quite the case, yet at least. And I’ve been reading for a while that the amount of money spent on mobile advertising has been both “growing” and yet still “behind” other internet advertising. It can be both at the same time since growth is from a small amount.
Her analysis is the first time I’ve seen a quantification of what “behind” means. There are examples of the types of ads (print, radio, TV, internet, and mobile), and the amount of eyeball time spent on the medium type, and the ad spend percentage of that medium type, for the US market. These are relatively equal except for print and mobile. Equal, for arguments sake, would point out that the percentage of ad is “right” for the percentage of eyeballs viewing that medium. So if 10% of an individual’s time is spent watching TV compared to the other mediums, 10% of ad spend should occur there.
For print, the ad spend is well in excess of the time spent, pointing out that print ad spend is maybe too high, unless there are other benefits from this type of spend. For internet, time spent and ad spend percentage are about equal. But for mobile, ad spend percentage is only half of the time spent, pointing out an opportunity to spend more where more eyeballs are, to the tune of $22B in the US alone.
This is interesting and outlines why mobile advertising is expected to grow. It is quite possible these ads will become more and more interactive, thus creating opportunities for different kinds of ads involving real-time communications.