Mobile neglected by advertisers

23 February 2012

SAN FRANCISCO: US advertisers are drastically underspending on the mobile channel, new analysis from Flurry has indicated.

According to the digital research firm, consumers spent 23% of their overall "media time" on mobile devices in 2011. But over the same period mobile adspend accounted for just 1% of the all-media total.

Adspend measured against overall time spent per media was broadly aligned for TV (43% versus 40%) and radio (11% and 9%), suggesting that marketers had weighted their budgets correctly for these channels.

But there was a distinct under-investment in online (16% of adspend, versus 22% of media time), and a marked over-investment in print media, with newspapers and magazines accounting for 29% of adspend and just 6% of media consumption time.

Flurry suggested that these disparities would be evened out over time, and that mobile underinvestment could be attributed mainly to the fact that the channel was still relatively new, with systems for tasks such as bulk-buying inventory and tracking ad effectiveness yet to be standardised.

"With the iOS and Android app economy only three-and-half years old, Madison Avenue and brands have yet to adjust to an unprecedented adoption of apps by consumers," the report added. "Further, the mobile advertising ecosystem remains nascent, without sophisticated platform tools."

As part of its report, Flurry also identified common features of the mobile advertising audience, showing that smartphone-owning households have an average annual income of $66,000, versus the national average of $44,000.

Mobile advertisers were found to be putting the highest values on young, well-educated adults.

Overall, 25 to 34-year-olds were the most valuable audience, with eCPMs of $7.80 for males and $12.92 for females in this age group. In terms of educational attainment, those who had attained a bachelor degree were found to have the highest eCPMs of all segments, on $7.92.

"Based on our analysis, revealing that the most sought after segments already interact most with mobile ads, a key ingredient required to realize the promise of mobile advertising is the introduction of mobile ad platforms that can segment publisher audiences and enable targeting by advertisers to reach segments of their choice," the report added.

Flurry used data from VSS and Kleiner Perkins Caufield & Byer, as well as its own analytics, for the report.

Data sourced from Flurry; additional content by Warc staff