Mobile Advertising Revenue Forecasts Roundup

Mobile advertising plays a crucial role in the app economy, it’s one of the financial drivers that move it forward. On one side, each year mobile devices hardware and software enhancements bring more and more opportunities for brands to reach out their customers more efficiently. On the other side, mobile advertising companies potential to generate revenue increases as well. In this article we want to put together data from several sources to draw a picture of what revenue potential mobile advertising industry has to offer to advertisers in the coming years.

Key Mobile Advertising Revenue Forecast Statistics:

  • Mobile advertising spending in 2018 – $167 billion
  • US mobile advertising spending in 2018 – $57 billion
  • Average US mobile advertising revenue growth till 2018 – $2-3 billion a year
  • China mobile advertising spending in 2018 – $40 billion
  • US Mobile App Install Advertising Revenue in 2018 – $9 billion

These are the keys to forecast a mobile advertising industry revenue potential, let’s draw more detailed picture for specific countries and companies and compare mobile with other types of advertising.

Mobile internet advertising spending is being growing for a number of years and, according to the forecast, it will continue to grow in the coming years. At the same time, the speed, with which it grows, has been and will be slowing down. According to eMarketer forecast, we should expect it to reach $195 billion by the year 2019, twice as much as it was in 2015, when mobile internet advertising revenue was only $69 billion. We can explain this slowdown by the ad market dependance on the mobile industry in general. Businesses that come to mobile ad market have a harder time to reach out their consumers, because of a big competition and because of app users general tendency to use only a handful of apps frequently. In such environment it becomes harder to achieve a greater exposure for a product or service on mobile devices.

Forecast: Mobile Internet Advertising Spending Worldwide, 2013-2019


Source: eMarketer

Now let’s look at the geographical distribution of mobile advertising revenues. For the next two years the biggest portion of this revenue will be generated on the US mobile market, by 2018 the total mobile ad revenue will reach $57 billion, almost $30 billion more than it was in 2015. At the same time, even though the China’s mobile ad market is smaller, but it’ll be growing faster, which will mirror its faster economic growth. In 2015 China commanded only $14 billion mobile ad revenue, but by the year 2018 it’ll hit $40 billion threshold, meaning it will triple in volume. Apart from US and China, Brazil, Spain, India and Indonesia will be outliers on the overall trend of doubling mobile ad revenues we can see for the other countries on the list. According to the eMarketer forecast, Indonesia’s will increase its mobile ad revenue on an order of a magnitude, from $129 million in 2015 to $1.5 billion in 2018.

Forecast: Mobile Advertising Spending Worldwide, by Country, 2013-2018


Source: Adage

As we’ve seen on the previous graph US will continue its leadership in mobile advertising revenue generation. Let’s look at how different advertising channels, and Mobile in particular, will be growing in the next couple years. The pattern you can see on the graph below is that Paid search and Display will be growing slower than Mobile and Video. The mobile ad revenue in United States is projected to grow, from $12.6 billion in 2015 to $19.2 billion in 2018.  The average growth speed for Mobile will be $2-3 billion a year, meanwhile other channels will be growthing only $1 billion or less a year.

Forecast: US Online Advertising Revenues, by Channel, 2013-2018, in billions


Source: MarketingCharts

The next up is the statistics for how mobile advertising stacks up against other media revenues in United States from 2011 to 2017. We see the most dramatic increase for Mobile media, from $1.6 billion in 2011 to $31 billion in 2017, 30 times jump! None of the other media will experience similar growth in the coming years. Print, Radio, Outdoor and Directories will be growing with much slower pace than Mobile, TV is the only other media that is forecasted to growth significantly in the coming years.

Forecast: US Advertising Revenues Share, by Media, 2011-2017


Source: eMarketer

The China’s mobile advertising industry growth dynamics present a special interest. The country’s economy continues to growth really fast and hence it’s interesting to see how various Chinese IT companies are projected to grow this year. Among top five companies that generate mobile advertising revenue, Tencent is the one that, according to the forecast, will grow 93% this year. Alibaba, the leading Chinese Internet company, has jumped ahead of Baidu last year and will continue to lead this year, with $7.3 billion mobile advertising revenue, $2.6 billion up from 2015.

Forecast: China Mobile Advertising Revenues, by Company, 2013-2016


Source: eMarketer

There are several companies that contribute to the US mobile advertising revenue. Amongst these Facebook, Google and Twitter are being the leaders since 2013, and are projected to lead the next two years. Facebook mobile ad revenue will increase 5 times from $1.5 billion in 2013 to $7.5 billion in 2017, Google’s revenue will increase even more significantly, from $630 million in 2013 to $2.4 billion in 2017. Over the course of several years Twitter experienced serious problems with growth of its user base that slowed down its financial growth as well. Despite those difficulties, the company’s mobile ad revenue is projected to hit $2.3 billion mark in 2017, almost 8 times of its mobile ad revenue in 2013, which was only $320 million. The following chart contains Apple’s iAd, but according to the Apple’s statement, the network will be discontinued as of June 30, 2016. During its operating time, Apple had ups and downs with the iAd’s efficiency for app developers and finally the company’s decided to abandon a mobile advertising market.

Forecast: US Mobile Advertising Revenues, by Company, 2013-2017, in millions


Source: Statista

According to the BusinessInsider forecast, the most dynamic sector of mobile advertising, the mobile app install advertising, will  double generated revenue in 2019, reaching $6.8 billion point. The rising popularity of this app user acquisition channel is driven by its efficiency, easy-to-measure ROI and exceptional performance on Facebook. But it needs to be pointed out, that the growth pace will be slowing down, and it can be explained by a slower app stores growth.

Forecast: US Mobile App Install Advertising Revenue, in billions


Source: BusinessInsider

Final Thoughts

Mobile advertising industry continues to grow and its 3-4 year forecast promises a great potential for ad companies. In a future, mobile ad spending growth will be defined by major mobile platforms such as Android and iOS expansion to Asia, China and India in particular, as well as Latin America and Africa. The expansion in terms of both – hardware and software to meet the demand of the world’s population sector that right now simply can’t afford expensive smartphones and tablets. And finally, as we’ve seen on the Apple’s iAd mobile advertising platform example, even such tech giant as Apple isn’t immune to a failure but it just goes to show the relevance of the Evolution theory statement about surviving of the fittest.