Summary: Internet advertising spending continues to grow and increasing mobile usage indicates that these devices will attract a larger share of advertising revenue.
Growing Importance of M-commerce
Spending on Internet advertising continues to grow faster than all other forms of advertising. According to Nielsen’s quarterly Global AdView Pulse report, advertisers spent 12.1 percent more on Internet advertising than they did 12 months ago.
Overall global spending on advertising was US$128 billion in Q1 2012, up 3.1 percent on the same period last year. Interestingly, the biggest increase came from Internet advertising, which grew by 12.1 percent.
In Europe, although overall ad spend was down slightly (0.25 percent), spending on Internet advertising flew in the face of this fall, growing by 12.1 percent. Additionally, with large international events taking place this year such as the European Championships and Olympic and Paralympic Games, this trend is likely to continue.
The future of mobile advertising in particular looks promising. Digital marketing intelligence firm, Emarketer, has projected that mobile advertising spending will grow to £358 million in 2012, from £210 million last year, an increase of 70.3 percent. The company has forecast that thereafter growth will continue at more than 50 percent per annum for the following three years. Currently mobile advertising makes up only around 2.3 percent of total spending on advertising in the UK, but this is expected to grow to 11 percent by 2016.
Research published by digital analyst comScore Inc., also supports the growth in smartphone usage. In the five biggest economies in Western Europe (France, Germany, Italy, Spain and the UK), 16.6 percent of smartphone users had recently accessed ecommerce sites via their mobiles. This represented a 100 percent increase on the same time last year. Approximately 12.4 percent of smartphone users had purchased via their devices and notably, for those who had accessed retail content the conversion rate was 75 percent.
According to the World Bank, an incredible 75 percent of the global population now has access to a mobile phone and the number of mobile phone subscriptions has increased from less than one billion in 2000 to six billion in 2012.
In the US more than half of mobile phones are now smartphones and in June, the number who used mobile commerce apps passed 50 percent for the first time. The most popular shopping apps unsurprisingly are eBay, Amazon.com, Groupon and Amazon Appstore.
The UK is one of the biggest smartphone markets in Western Europe and around 6.5 million users are accessing ecommerce sites or apps. Indeed around half of smartphone users utilise mobile apps. ComScore’s European Mobile Product Manager, Hesham Al-Jehani said: “E-Commerce has become central to many consumers’ digital lives over the past few years, but we are now observing a rapid increase in the emergence of m-commerce, where consumers visit retails sites or use dedicated apps and ultimately make on-device purchases.”
For the typical affiliate marketing agency UK, another reason for utilizing the mobile device market is that research has found that mobile shoppers are valuing ease of use over price. Greystripe found that mobile shoppers were less likely to make use of coupons than traditional shoppers. Kurt Hawks, general manager at the company said that mobile shoppers are “more likely to buy when given an interface that is easy to use.”
Attribute to: Jag Ture, Cayenne Red.
Jag is a member of the digital marketing agency team at London based PPC Agency Cayenne Red. She has been writing for over five years, and is a regular contributor to the media on how companies market themselves in the digital age.