Our preliminary estimate for global mobile advertising spend in 2015 stands at $48bn, around 30% of all internet adspend that year. Incredibly, mobile's share has more than doubled in just two years; a key indicator of the medium's meteoric rise.
Mobile's contribution is expected to grow further throughout the forecast period. Spend of $90bn on mobile-specific formats will account for approximately 44% of all online ad investment next year.
In contrast, global advertising spend on desktop internet formats has stagnated at around $112bn, and will likely decline from this year onwards. This trend has already started to play out in the world's largest digital markets, including the US, China and the UK. Consequently, mobile will be the primary driver of global online growth over the coming years.
Warc collates actual advertising expenditure for 93 markets, collected via an annual survey of monitoring organisations and ad industry bodies. This survey has run every year since 1980.
Using a combination of these adspend data and broader GDP and consumer expenditure forecasts from the OECD and IMF, we have for the first time modelled future investment trends on a global scale and released our findings in a free report, Global Ad Trends 2016/17.
One of the key findings within the report is the correlation between the increase in internet access via mobile devices, and the growing investment in certain mobile ad formats.
Data from GlobalWebIndex show mobile now accounts for over a third of all online time worldwide. Further, GWI identifies what it calls a 'mobile tipping point' in 2018, by when 16–24 year-olds will devote more time to their mobiles each day than to all other media channels combined.
It seems marketers are aware of the trend, as the allocation of ad budgets increases across a variety of mobile formats.
Social media
Social media advertising revenues, for example, are rising rapidly. Facebook revealed that mobile represented approximately 80% of its global advertising revenue in Q4 2015, up from 69% a year earlier. Full-year results show that Facebook's mobile ad revenue amounted to $12.9bn worldwide last year, up 74% from 2014.
Of the $641m in Q4 2015 ad revenue amassed by Twitter, the company said mobile accounted for 86% of this. Twitter's full-year ad revenue (both desktop and mobile) totalled $2bn worldwide last year, up from $1.3bn in 2014.
Warc uses the Internet Advertising Bureau's definition of social ad revenues when calculating future investment. This encompasses a vast range of activities, including social networking, blogger outreach, word of mouth, user generated content (UGC), crowd sourcing and many others.
Taken together, we believe adspend on mobile-specific social formats will reach $28bn worldwide by the end of 2017, approximately 31% of total mobile ad expenditure.
Mobile video
Investment in mobile video advertisements, including those that appear pre-, mid- and post-roll, is also growing steadily.
In China, the world's second-largest internet ad market, mobile video adspend reached RMB8.9bn ($1.4bn) last year, almost two and a half times more than was spent in 2014. By the end of this year, half of all online video adspend in China is likely to be mobile-specific, up from a share of just 20% in 2014.
Looking globally, on the current trajectory we believe mobile video ad expenditure will top $10bn next year.
Mobile search
In dollar terms, however, these two comparatively nascent formats are eclipsed by the primary driver of mobile growth: search advertising.
As an umbrella term, search chiefly incorporates both search engine marketing (SEM), a form of marketing that seeks to promote websites by increasing their visibility in search engine results pages, and search engine optimisation (SEO), the process of improving the volume and quality of traffic to a mobile web site from search engines via natural search results for targeted keywords.
Last year Google revealed that in ten countries, including the US and Japan, more searches took place on mobile devices than on computers. Google's net mobile search ad revenue amounted to an estimated $19.6bn in 2015, up from $15.0bn a year earlier.
Globally, we believe spend on mobile ads across all search engines is likely to reach $40bn by end-2017. Should it come to pass, mobile search adspend will have near doubled from today's levels.
Global Ad Trends 2016/17, a free report drawing from Warc's suite of data products, can be downloaded here.
