We all know mobile is growing at an incredible rate but sometimes one needs to step back and just look at the potential size of the mobile marketplace. So try this for size: by the end of this year, the mobile ad market could outstrip the entire online display advertising sector.
Now admittedly, this is a bit of a stretch, but there are good statistics to back it up. Mobile app sessions average 4.2 minutes with 4.3 ads served during that time. A million smartphones are being activated every day, and consumers download an average of 65 apps per device. And smartphone users spend more time in mobile apps per day than they do online.
Put all that together and you get a growth in mobile app ad inventory that is more than doubling each quarter. For the app analytics company that produced these figures, Flurry, this is where things get a little squirrely. They use an average cpm of $2.50 for mobile ads and then assume that all the inventory gets sold at that rate. Then they compare that total to the actual value of the online display ad market. Clearly, this comparison is BS – actual ad inventory sold vs. total inventory sold at a mythical rate – but it’s useful to get an idea of what is possible.
In June 2011, Gartner projected that mobile advertising revenue would double to $3.3 billion worldwide in 2011, and grow from around $300 million to over $700 million in 2010 in North America. eMarketer, a research firm, predicts that U.S. mobile ad spending will top $1.1 billion this year.
For performance marketers the takeaway is that cheap media buys are easy to find in mobile – you just have to work out how to get them to convert.