Mobile is undoubtedly one of the core topics in advertising this year. Ad spending continues to show some impressive growth, jumping 89% from Q1 2015 to Q1 2016. That’s according to a new report from mobile publisher and app developer advertising platform, Smaato, which identifies the key trends in mobile.
Based on billions of mobile ad impressions served through its exchange, the Q1 2016 Global Trends in Mobile Advertising study also finds that the Americas are showing the highest growth in mobile at 123% compared to 65% for APAC and 32% EMEA. Overall, mobile ad spend now represents a $22bn opportunity in the US.
Mobile ad spending in the US
Among the developing markets, South America showed almost doubled the indexed eCPMs compared to APAC during the first quarter in 2016. Smaato has coined the region “Emerging Mobile MVP”.
South America indexed eCPM values
However, the country exhibits somewhat of a gender gap, with 82% of all ad requests coming from users younger than 35 years old.
Marketers and publishers however can benefit from mobile in the region which is set to account for 6% of ad spend in Brazil and 4% in Argentina this year. Growth has been projected to push these figures to 19% and 17% respectively by 2020.
Perhaps one of the most interesting findings is that mobile video adverts delivered 11x higher eCPMs for publishers at a 1,042% lift compared to other formats. However, the context does matter. Mobile video ads shown in-app generally deliver higher revenue compared to those on the mobile web. iOS apps delivered almost 3x higher eCPMs over the mobile web.
eCPM for mobile video ads was also higher on iOS compared to Android devices.
Mobile video ads deliver 11x higher eCPMs
In terms of app categories which deliver the highest eCPMs, Music apps noted a 54% eCPM lift, followed by Video and Computer Games (38%), Society (29%) and Real Estate (15%). With people using the Arts and Entertainment app category the most (52%), it makes sense that they consider mobile video ads as less invasive since they are already exposed to video and sound.
Video ads considered less intrusive by those using entertainment apps
In terms of ad size, larger formats like interstitials (320×480) delivered triple the eCPM for publishers versus traditional banner ads (320×50).
Ad format size
Ragnar Kruse, CEO and Co-founder of Smaato, says:
“Mobile video advertising is showing enormous growth potential, helping publishers to boost their monetization efforts and advertisers to engage their target audiences better. It’s very encouraging to see the continued overall strength of quarterly mobile ad spend growth, which is up 89% globally. I’m also impressed by the immunity of mobile ad spend to downward macroeconomic factors. For example, Brazil’s emerging mobile market saw quarterly mobile ad spend grow a surprising +121% in Q1 year-over-year – almost as much as the healthy US market at +130% – despite major economic and political challenges.”
Smaato ads that ad fraud continues to be an issue for the digital media industry. Invalid bot traffic is expected to cost advertisers $7.2bn in 2016. The company assures that it has implemented a publisher block rate of 14% as part of its Smaato SPX platform since its launch in 2015.