Did you catch the December news from eMarketer, forecasting that the two biggest players in mobile advertising – Google and Facebook – will be dining on a shrinking piece of the U.S. mobile-ad spending pie in the coming years?
It’s no small shrinkage either; eMarketer shows the two companies’ combined 55 percent share shriveling to just 48 percent next year, thanks to players such as Yahoo, Microsoft, and AOL, who are hungrily gobbling up market share by growing their mobile ad business at a much faster rate than Google and Facebook. The predictions show this shrinkage continuing through 2016.
Why is this happening?
- Many factors are at play. Among them:
- Google and Facebook got an early start in the mobile ad market, becoming the de facto place for advertisers to throw ad dollars.
- But being the first horses out of the gate is not the same thing as being best. Some advertisers have been disappointed by their experience in working with Facebook.
- For the perpetually-connected consumer of today, the browser is devolving as the gateway to online actions and transactions, its influence being diminished by mobile apps – a change that especially negatively impacts Google’s share.
- Other mobile ad venues and solutions continue to arise, proving to be effective alternatives to the Big Two.
- As the mobile ad market is maturing, marketers are wisely diversifying their investment, rather than keeping their eggs in one or two baskets.
Mind you, neither Google nor Facebook will be feeling much pain from their shrinking share of the mobile ad market, since the size of that pie is growing dramatically. As a result, eMarketer estimates
that U.S. mobile ad spending will grow 50 percent next year alone, rising to more than $28 billion, and more than $40 billion in 2016, as the chart below shows.
So, even as Facebook and Google’s share of the pie shrinks, their mobile ad revenue will continue to grow – just not as fast as their competitors’ growth rates.
Interestingly, mobile ad technology platforms from companies like 4INFO are influencing mobile ad revenue share. How so: Measurability is, not surprisingly, proving to be critical to an advertiser’s ability to justify mobile ad spend since growing mobile ad spend often comes at a price – reducing budget allocation to traditional screens. Any service provider that can concretely validate that a company’s mobile ads are actually paying off in a lift at the cash register will dramatically influence mobile ad spending.
We are seeing plenty of this at 4INFO. We’ve combined precision ad targeting at scale with meaningful attribution in AdHaven Bullseye™
, our flagship technology platform With our TruView™
measurement, you know who’s buying your product, no matter how or where they’re buying it. You can finally understand the true return on your mobile advertising.
Across campaigns we’ve done for more than 150 of America’s most recognizable brands, we’ve seen consistent sales increases averaging 7.5 percent (and as high as 23 percent!) and an average return on ad spend of 382 percent.
Expect the companies to capture the share of the mobile ad spend in the next year to be those companies that are able to help marketers attribute the value of their advertising to meaningful measurement, specifically actual incremental sales lift both online and in brick and mortar stores. The days of being able to live with measuring clicks and page views are (thankfully!) behind us, and so will be marketers, agencies and mobile ad platforms that aren’t able to measure or deliver meaningful return on ad spend.