Mobile Advertising Budgets Up 142 Percent Over 2011: IAB Industry Survey

As mobile devices enable consumers to easily interact with brands, mobile advertising correspondingly attracts more budget and is expected to continue this upward trend.

Marketers at 300 U.S. companies increased their mobile advertising budgets by 142 percent from 2011 to 2013, according to Marketers Perceptions of Mobile Advertising, produced by Ovum for Interactive Advertising Bureau (IAB). Of the marketers surveyed this year, over one-third allocated more than $300,000 to mobile advertising, compared to merely seven percent in 2011. Among them, 16 percent spent more than $500,000 on mobile advertising, while the highest bracket in 2011 survey was “more than $300,000.”

This year, Ovum also added B2B and B2C perspectives and introduced new questions to reflect the changes in mobile advertising over the last two years.

At the same time, 70 percent of respondents predict their mobile advertising spend will soar over the next two years, 5 percent up from 2011. Further, 19 percent expected that mobile advertising spend will increase by more than a half during the following two years.

“Marketers are seeing more value in mobile, so they are willing to allocate more of their marketing dollars to the medium,” says Joe Laszlo, Senior Director of IAB. “The increase in budgets reflects the increasing size of the Smartphone and tablet audience in the United States.”

Smartphones have been considered the most used device for mobile advertising campaigns during the past two years, but tablets are catching up. Over half of respondents flagged tablets as high priority, compared to 31 percent in 2011.

“A majority of American adults owns a Smartphone now, and tablet adoption by US households continues to grow,” Laszlo tells ClickZ. “Marketers need to be on whatever media platform or device their customers are using, and so can’t afford to ignore phones and tablets.”

Indeed, consumers today use various channels to interact with brands. Marketers, in response to this, design ads across different screens in hopes they can drive sales, increase brand awareness and support special promotions.

Marketers deliver ads in various forms, as well. A deeper look at the use of rich mobile advertising inventory reveals that mobile website ads are highest at 70 percent this year, followed by banner advertising (49 percent), mobile search advertising (44 percent) and mobile messaging (41 percent).

It’s worth noting that over half of marketers surveyed partnered with creative agencies this year to make the most of mobile advertising. Nearly eight in 10 respondents said they are “satisfied” or “completely satisfied” with creative agencies’ ability to help them reach their mobile advertising objectives.

Over the next year, marketers will tackle mobile challenges including:

• Lack of agency expertise in mobile advertising
• Lack of standardized metrics
• Lack of standardized advertising units
• Limited opportunities for creativity
• Difficult to create mobile rich media

This most recent Marketer Perceptions of Mobile Advertising report was released by Ovum in September, 2013 and both updates and expands upon the survey of 2011. Both surveys analyzed data from 300 top-level brand marketing executives in the U.S. Get the full version of the 2013 report from IAB website.