Blog Archives

Mobile Advertising to Reach $8.2 Billion by 2016 As Search Market Share Shrinks

New figures released by Forrester Research project the healthy growth recently seen in U.S. interactive advertising will continue through 2016, with total spending reaching $76.6 billion, or 35 percent of global ad spend.

The figures are particularly encouraging for those in the mobile sector, who have had to deflect criticism about the current state of mobile advertising and its viability using current technology. The report projects mobile interactive advertising will enjoy a compound annual growth rate of 38 percent, reaching $8.2 billion in 2016. This best-in-class growth will be led by a growing mobile commerce market, consolidation of mobile ad networks and the implementation of rich media ad formats as smartphone technology advances.

Consolidation in mobile ad networks has accelerated in the past two years, as Google acquired AdMob for $750 million, Apple acquired Quattro Wireless for $275 million and ValueClick acquired Greystripe for $75 million, placing the full force of some of the most valuable companies in the world behind the mobile ad sector.

Mobile Advertisement Example - Land Rover

While display and search are projected to retain their dominance of most interactive ad budgets as rich media, text listings and online video components become budget staples, search engine advertising is expected to see a significant reduction in both its growth rate and its share of the overall interactive market. Search advertising is projected to experience a compound annual growth rate of 12 percent, nearly doubling from $18.8 billion in 2011 to $33.3 billion in 2016, but will see its share of the overall market decrease from 55 percent to 44 percent over the same period as other formats establish themselves as meaningful components of large scale media buys.

Forrester reports social media marketing will enjoy a healthy 26 percent compound annual growth rate, but will only reach $5 billion in total spend due to the inexpensive nature of many social ad platforms.

With the explosive valuations of literally thousands of VC-funded startups heavily dependent on advertising revenue for survival, let alone growth, these latest figures are encouraging. However, marketers appreciate (and are increasingly demanding) both security and results, which will likely benefit the largest and most established companies in mobile and social, including Google, Apple, Facebook and Twitter. The industry should expect further consolidation as the large, cash and equity-rich players utilize critical acquisitions to expand their arsenal and take advantage of the rapidly accelerating growth in interactive advertising.

Follow @LetsChatBiz on Twitter and join us on Facebook for access to exclusive content.

Advertisements

ComScore + AdXpose is the Most Important Deal in Online Advertising in Years

The online advertising industry has reached an inflection point. No better is this critical moment in digital advertising portrayed than in the acquisition of AdXpose by comScore for $22 million.

CMOs are feeling increasingly comfortable diverting or devoting larger percentages of their budgets online, convinced that the benefits of online advertising are as revolutionary as promised. Brands spend tens of billions of dollars online, and they expect results.

How campaign performance is measured varies by brand or agency; some seek simple impressions, others seek clicks and conversions. One of the key selling points of online advertising is the ability to measure campaign performance against objectives in real-time. Tracking technologies record every visit and every impression, but the validity of these measurements have recently come into question. A major concern is falsely inflated impression counts, artificially inflating CPM prices for media buyers. Impressions are traditionally counted in tandem with page visits, which has proven to be a deeply flawed system of measurement.

AdXpose is changing everything.

Led by CEO Kirby Winfield, AdXpose verifies impressions by telling advertisers where their ad was placed on the page and, if below the fold, whether or not a visitor scrolled down to see the ad.

“If you’re counting every impression as viewable when only 50% are viewable, then every metric that you’re using to value your media is inefficient and inaccurate,” Winfield said. “You’re pulling in a bunch of impressions that have no chance to be viewed.”

Adxpose Logo

The company also identifies the content the ad was placed next to, an important tool for CMOs demanding their ads be served beside “brand safe” content. Winfield argues the consolidation of advertising measurement data is vital if digital wants to slice into the holy grail of ad dollars, television.

“You have to go to one vendor to get viewabililty data. Another for survey data. A vendor to get audience verification. Another to get conversation data,” Winfield said. “You’re taking a buying process that is already 4-5x more difficult than buying TV and making it 4-5x more difficult to get metrics.”

comScore CEO Magid Abraham believes a pricing revolution is underway.

“Prices are going to adjust. All of the junk inventory is going to be significantly slashed,” Abraham said. “If you’re charging $.25/CPM but only 20% are visible, then the unit price is actually $1.25. We will move from a medium from where there is no scarcity to an industry where there is scarcity.”

comScore and AdXpose serve as a powerful duo at a critical juncture. As TechCrunch’s Erick Schonfeld astutely notes, “it’s not about clicks and conversions, it’s about attention.” Innovation in online advertising is at an all-time high; it’s no longer simply text and banner ads. Rich media, branded content and social solutions are transforming the industry with the aid of real-time exchanges.

Ferociously accurate data is the catalyst that can launch online advertising to the forefront of brand spending in the digital era. CMOs are demanding stronger performance, media buyers are getting smarter, auditors are more closely scrutinizing campaign performance, and this industry evolution is good for everyone. Brands get accurate, verified audience data, and publishers are able to charge premium CPMs through guaranteed, validated ad presentation.

The revolution has begun, and AdXpose is poised to create a shakeup with financial implications that will dwarf its $22 million price tag.

Google Launches Google+ iPhone App, Expands Critical Mobile Presence

After weeks of speculation, Google has received approval from Apple to release the Google+ iPhone app. However, the highly anticipated launch did not go off without a hitch. The first release of the Google+ iPhone app was buggy and highly unstable, frequently crashing and logging out users at random. Google quickly identified and rectified the issue, releasing an updated version of the app an astonishing 1 hour and 40 minutes after the initial launch.

Lead Project Manager for Google+ Mobile, Punit Soni, revealed early this morning (on Google+, of course) that the App Store was serving early downloaders a test version of the Google+ iPhone app.

(Some users report the Google+ iPhone app is not showing up in searches within the App Store. Here is the download link for the app, accessible through your iOS device.)

The app allows users to access their Stream, comment on and +1 other user’s posts, but the current version of the app does not allow users to re-share posts in their Stream. Soni, in response to Robert Scoble’s post reviewing the app, announced an in-stream Share feature is in the works. The app provides access to Photos from your Circles, your personal albums and all photos stored on your iPhone, and allows you to upload and geotag photos to Google+. Check out the full Google+ for iPhone review from Mashable, which includes 20 in-app pictures.

Google+ iPhone App - Screenshot

One of the key features driving the Google+ iPhone app’s utility over the browser-based version is the mobile-optimized Huddle feature. The success of Google+ will be largely driven by its seamless integration between mobile and desktop, and the two-way or group chat Huddle feature enables Google+ to become a central hub of mobile activity, replacing text messaging and additional group chat applications if the app gains widespread traction.

The brief and uncharacteristic early hiccup was positively overshadowed by Google’s quick update, and the Google+ iPhone app paves the way for Google+ to further penetrate the mobile environment, a critical battleground in the heavyweight bout between Google+ and Facebook. If Google+ can continue the growth trajectory it has enjoyed during its invitation-only trial phase, and perhaps beat Facebook to the punch with a standout iPad app, the social networking landscape that seemed set in stone just months ago will be poised for significant transformation. This competition between two immeasurably smart and talent-rich companies will only lead to stronger products and a better user experience, and that is something we can all look forward to.

Still searching for an invite to Google+? Click HERE for an invite, courtesy of @LetsChatBiz.