Mobile adspend set to surge in the US

26 May 2010

NEW YORK: Mobile adspend will almost double in the US this year, reflecting the growing popularity of devices such as the iPhone among consumers.

According to estimates from IDC, the research firm, mobile advertising expenditure in America will rise from $220m (€180m; £153m) in 2009 to $433m in 2010.

Looking ahead, the company also predicted that the advertising revenues generated by this emerging channel will reach $1.8bn by 2014.

One key driver behind this trend will be the widespread uptake of "tablets" like Apple's iPad, with sales in this category set to climb from 7.6 million units this year to 46 million units by 2014.

"Mobile advertising is certainly the hottest online ad segment," Karsten Weide, an analyst at IDC, argued.

Despite this, mobile's share of new media marketing budgets is due to stand at just 1.3% this year and 5.7% in five years time.

While these figures may be comparatively small, Weide added brands should "stake a claim now both in terms of traffic and advertising market share" or risk not being able to "catch up" later.

Overall, IDC predicted that total online advertising budgets – including mobile – would jump by 19% to $31.5bn in 2010.

"Ad spending will rebound in 2010, and search and video will be the major battlefields for dominance in online advertising," Weide continued.

"Mobile is strategically important but will not be a decisive factor in the race among major publishers – yet."

Paid-for search will enjoy growth from $13.8bn to $27.3bn over the forecast period, further strengthening Google's hold on the sector as a whole.

"Search ads may be less sexy than mobile online ads, but it's where cash registers will ring most loudly in the coming years," said Weide.

Data sourced from Internet Retailing/MediaPost; additional cotnent by Warc staff