UK Mobile Ad Spend Hits £1bn

David Murphy

[caption id="attachment_42924" align="alignleft" width="180"]Mobileadvertising screenshot Mobile advertising is now worth more than £1bn in the UK alone[/caption]

Mobile ad spend broke the billion pound mark in 2013, hitting £1.03bn, 93 per cent up on the 2012 total of £529m, according to the latest Internet Advertising Bureau UK (IAB) Digital Adspend report, conducted by PwC. Mobile now accounts for 16 per cent of all digital advertising spend compared to 10 per cent in 2012.

Social media advertising spend on mobile increased to £221.8m in 2013, and by 71 per cent across digital channels overall, to £588.4m. Consequently, mobile now accounts for 35 per cent of total digital social media advertising.

Display advertising across the internet and mobile grew by 22 per cent on a like-for-like basis to reach £1.86bn. With mobile display growing by 180 per cent on a like-for-like basis to £432.4m in 2013, mobile now accounts for 23 per cent of total digital display advertising.

Digital advertising online and on mobile increased by 15.2 per cent to 6.3bn, compared to £5.45bn in 2012. And among media owners who submitted revenue figures to the IAB/PwC, tablet-dedicated advertising (not including internet advertising displayed on a tablet by default) grew by over 400 per cent to reach at least £34.4m in 2013; up from £6.8m in 2012.

Tablet ownership up
This increase has been fuelled by an increase in tablet ownership, which grew 63 per cent year-on-year from 11m to 17.9m Britons in February 2014 according to comScore’s mobiLens research. Over one in four British consumers now owns a tablet, and 36 per cent of people accessing the internet are now doing so via tablets, according to UKOM/comScore February 2014 figures.

57 per cent of tablet owners online say it’s their “go-to” device to surf the internet at home, according to YouGov data. 66 per cent say it’s easier to go online using a tablet, while 65 per cent say they like to use them while watching TV.

Online banking
Banking and finance is the area of people’s lives that would be most affected without the internet or mobile phone – cited by 48% of Britons online – followed by keeping up with current affairs (37 per cent) and relationships with friends and family (35 per cent).

“Digital advertising continues to grow at impressive rates simply because marketers are becoming more responsive and savvy to the increasing ways people consume content across different devices,” said Tim Elkington, director of research & strategy at the IAB. “However, there’s still a lot of work for the industry to do when it comes to tablet advertising. Spend on ads designed specifically for tablets is growing fast but it’s still a very small part of the pie – despite the increase in tablet ownership, and the crucial role they play in people’s internet use at home. The tablet has moved from the offices of early adopters to the nation’s living rooms and advertisers should be following suit.”

Paid-for search marketing increased 14 per cent on a like-for-like basis to £3.49bn. Classifieds, including recruitment, property and automotive listings, grew 9 per cent like-for-like to £886.5m, accounting for 14 per cent of digital ad spend.

Video advertising grew by 62 per cent year-on-year to £324.9m. Video now accounts for 18 per cent of all online and mobile display advertising. Driven by mobile display and video, the consumer goods sector continued its dominance as the biggest spender on digital display advertising, overall – accounting for 18 per cent in 2013, compared to 16 per cent in 2012.

Zac Pinkham, managing director, EMEA at advertising platform, Millennial Media, believes that breaking through the £1bn mark proves that mobile has moved from an experimental to a strategic phase.

“Where the UK mobile ad market was initially driven by performance advertisers, these results show that it’s now maturing and mirroring the US more closely as growth is fuelled by brand advertisers,” he said. “Driven by a 93 per cent overall rise on the previous year, the IAB’s results have indicated the significant impact of tablets near-ubiquity in UK households in driving spend. Our own platform data from 2013 supports this, with tablets accounting for 24 per cent of ad impressions, and overall growth also being driven by mobile video and display advertising.

“Mobile ad spend is only set to continue, and we believe that the next phase of growth is in new measurement solutions. When brands can easily evaluate the effectiveness of mobile to demonstrate the impact on real-world metrics – such as brand uplift, foot traffic, or increased revenue – then I believe we'll see even further dramatic growth in the industry.”