BIA/Kelsey Forecasts U.S. Mobile Local Ad Revenues to Reach $9.1
Billion in 2017
Mobile search will be the dominant ad format, growing to $5.7B in
CHANTILLY, Va. (April 4, 2013) – BIA/Kelsey,
advisor to companies in the local media industry,
forecasts U.S. mobile local advertising revenues to grow from $1.2
billion in 2012 to $9.1 billion in 2017, representing a compound annual
growth rate (CAGR) of 49.3 percent. This corresponds to a 0.9 percent
share of local media ad revenues in 2012, growing to a 6.1 percent
share in 2017, according to the firm’s recently released U.S.
Local Media Forecast (2012-2017).
BIA/Kelsey’s projected mobile local ad revenues represent a
subset of total U.S. mobile ad spending, which the firm forecasts to
grow from $3.2 billion in 2012 to $16.8 billion in 2017. This puts
locally targeted mobile ads at 38 percent of overall U.S. mobile ad
spending in 2012, growing to 54 percent in 2017. Several factors will
drive the “localized” share of U.S. mobile ad revenues,
- Large brand advertisers will increasingly adapt their campaign
objectives to the capabilities of the mobile device due to effective,
abundant, and currently undervalued mobile local ad inventory.
advertising will move down market to the
SMB segment through a combination of self-serve tools and local media
direct sales channels.
that develop for location-targeted ads will
compound ad volume growth.
will increase among ad networks and ad tech
providers (i.e., Enhanced Campaigns).
“Though inventory growth currently outpaces advertiser demand,
we believe the latter will begin to accelerate,” said Michael
Boland, senior analyst and director of content, BIA/Kelsey. “This
will not only increase overall mobile ad spend, but mobile ad rates
such as CPMs and CPCs, which are currently lower than desktop equivalents,
due to inventory oversupply.”
Click to expand/collapse graphics.
Mobile Local Media Forecast by Format
This forecast comprises advertising placed in mobile search, display,
video and commercial SMS. Search advertising currently holds the largest
share, followed by display and SMS. Search’s dominant share indexes
higher within this localized segment than within the broader of U.S.
mobile ad revenue total, due to the high correlation between mobile
search and local user intent. There is conversely a lower percentage
of localization within the display category, due to the branding (as
opposed to direct response) and reach-driven objectives inherent in
display campaigns (i.e., in-app ads). The forecast includes a breakdown
of mobile local ad spending by format as follows:
- Display (display advertising applied to app and mobile Web
inventory) will grow from $379 million in
2012 to $2.7 billion in 2017
(text advertising applied to search queries
on mobile devices) will grow from $704 million
in 2012 to $5.7 billion in 2017
- SMS (commercial
SMS messaging) will grow from $101 million
in 2012 to $162 million in 2017
- Video (rich media ad units
distributed within app and mobile web inventory)
will grow from $38 million in 2012 to $515 million in 2017
BIA/Kelsey custom advisory service clients can log into the client
resource center to download the full mobile media forecast.
About the Annual U.S. Local Media Forecast
BIA/Kelsey defines the local media advertising
marketplace as those media that provide local
audiences to all types of advertisers. Mobile
local advertising is defined as advertising
that is targeted based on a user’s location.
BIA/Kelsey’s Annual U.S. Local Media
Forecast (2012-2017) draws from multiple sources.
These include proprietary data – company,
industry and country information in the public
domain – as well as discussions with
clients and non-clients about the direction
and pace of development in the local media
marketplace. The forecast is issued annually
each spring and updated in the fall. BIA/Kelsey
custom advisory service clients receive a full
forecast report. For information on gaining
access to the forecast by becoming a BIA/Kelsey
client or for details on purchasing the forecast,
contact Steve Passwaiter at email@example.com or (703) 818-2425.
BIA/Kelsey advises companies in the local media space through consulting and
valuation services, research and forecasts, Custom Advisory Services and conferences.
Since 1983 BIA/Kelsey has been a resource to the media, mobile advertising,
telecommunications, Yellow Pages and electronic directory markets, as well
as to government agencies, law firms and investment companies looking to understand
trends and revenue drivers. BIA/Kelsey’s annual conferences draw executives
from across industries seeking expert guidance on how companies are finding
innovative ways to grow. Additional information is available at http://www.biakelsey.com,
on the company’s Local
Media Watch blog, Twitter (http://twitter.com/BIAKelsey)
and Facebook (http://www.facebook.com/biakelsey).
For more information contact: