Once a “nice to have” mobile advertising will soon capture the majority of digital ad spend according to a new report by Marin Software, provider of cross-channel performance advertising cloud.
Driven by rapid consumer adoption of mobile devices, and a corresponding surge in mobile ad clicks and conversions, the report finds that advertisers will spend more on mobile than desktop ads by the end of 2015.
The report – view it here – also reveals that while consumers use mobile devices for product research, they still make most purchases on desktops. For advertisers, this means it’s essential to adopt cross-channel advertising strategies that reach consumers across devices and platforms.
The benchmark report, “Mobile Advertising Around the Globe: 2015 Annual Report,” includes statistics and trends uncovered through an examination of the Marin Global Online Advertising Index. The index consists of advertising data from leading global brands that manage more than $7 Billion in annualised ad spend through Marin’s platform. The dataset represents all major industry sectors, and 13 countries and regions, including USA, UK, Eurozone, Japan and China.
Key Findings from the report include:
Mobile Paid Search – a Meteoric Rise: Between January and December 2014, the share of paid search clicks on mobile devices rose 36%, from 32% to 44%. Paid search clicks on mobile devices are predicted to break 50% of the overall paid search market by mid-Q4 2015. In response to this trend, advertisers are predicted to spend more on mobile paid search ads than desktop by the end of 2015.
Research on Mobile, Buy on Desktop: Despite mobile’s rise, the report reveals consumers are more likely to use mobile devices for product research, and click on mobile ads, but ultimately make final purchases on desktops. Click through rates (CTR) on mobile search ads averaged 2.7%, while CTR on desktop search ads averaged 2.1%. The same pattern can be seen in mobile social ads (0.6% CTR) and mobile display ads (0.4% CTR). When it comes to conversion, however, desktop still rules. Desktop search ads had an average conversion rate of 10.3%, while desktop social ads had a conversion rate of 1.1%, and desktop display ads had a 3.1% conversion rate. This compares to mobile conversion rates of 7.1% (search), 0.4% (social), and 2.6% (display).
Mobile Display Emerging: Clicks on mobile display ads grew 60% from January to December 2014, starting at 32% and ending at over 50%. By the end of 2014, the majority of clicks on display ads came from smartphones and tablets. Again, smartphones took the majority of these clicks away from desktops, almost doubling in clickshare between January and December 2014. If these trends continue, by early Q4 2015, the percentage of clicks on display ads from smartphones alone – not including tablets – will account for the majority digital display clicks.
Mobile Already Dominates Social: Mobile devices already make up the majority of social ad spend, with over 55% of advertisers’ social ad spend going toward smartphone and tablet campaigns. It’s no wonder advertisers are spending freely on mobile social ads; they work. Overall, 62% of all social ad clicks come from smartphones and tablets.
Mobile Video Advertising on the Rise: While consumers still mostly watch videos on desktops, mobile devices are quickly catching up. Data from eMarketer reveals smartphones and tablets accounted for 30% of all digital video ad views in Q3 2014, and this percentage is on the rise.
Matt Ackley, CMO of Marin Software, said: “The rise of mobile is nothing short of astounding, but it’s important to remember most people jump between desktop and mobile several times when researching and buying products. Our new data reveals that advertisers clearly need to adopt strategies to reach consumers across multiple channels, using tools to accurately track attribution for mobile ads. Clicks on mobile ads don’t always lead to direct conversions, but often influence desktop or in-store purchases.”