FEATURES
RESOURCES
|
 |
 |
AdMob
said last week it delivered 1.6 billion-yes, with a
'B'-ad impressions to U.S. mobile users in September
alone.
| |
|
Excess inventory clouds mobile
advertising space
Providers both big and small struggle to fill
screens
By Colin
Gibbs
Story posted: October 20,
2007 - 5:59 am EDT
Advertisement
|
![]() | It's no
secret that advertising dollars are finally coming to mobile.
But for now, at least, it's the high-profile publishers that
are bringing in the cash.
How big mobile advertising
will be depends on whom you ask. The Kelsey Group predicts the
U.S. market will grow from $33.2 million this year to $1.4
billion by 2012, marking an impressive compound annual growth
rate of 112%. Several other market research firms peg today's
global market at $2 billion to $3 billion, exploding into a
$14 billion market by 2011, and ABI Research claims the space
will generate $19 billion by 2011.
Not to be outdone,
IDC stated in a February report that "The potential actually
exceeds the hype" for wireless ads.
It's true that
while mobile advertising is in its infancy, it does appear to
be a viable space. Established corporations like Proctor &
Gamble, Adidas and The Coca-Cola Co., among countless others,
are already spending big bucks in mobile, and AdMob said last
week it delivered 1.6 billion-yes, with a 'B'-ad impressions
to U.S. mobile users in September alone.
And those
numbers are just a start. While the year started slowly,
advertising spend has exceeded expectations for many
established content providers.
"The ad market has
really taken off; we are seeing extremely strong numbers in
our ad business," said Louis Gump, vice president of mobile at
The Weather Channel Interactive. "Frankly, it was a little
slow in the first quarter of the year. But it screamed in Q2,
we had a record month in August, and another in
September."
Small players struggling
But smaller
mobile publishers have yet to enjoy that kind of success.
Advertisers are buying up space on TWC, ESPN and other
high-profile wireless Web sites, but lesser-known sites are
still awash in excess inventory-even if those sites are wildly
popular among young mobile users. airG , for instance, recently
surpassed the 20 million-customer mark, delivering its social
networking offering in 10 languages and across more than 100
mobile operators. But despite the attractive demographics of
its user base, the Vancouver, British Columbia-based startup
is struggling to sell more than 10% of its ad
space.
"The last year's been good," said airG spokeswoman Allison Johnson. "We're definitely getting a lot
more interest, but we're still not selling anywhere near all
of our inventory."
The unfamiliar startups create a
compound problem for advertisers and brands looking to
leverage the new medium. Not only must they learn about mobile
advertising, they then need to identify the publishers with
whom they'd like to place their ads. So mobile marketing
startups are hoping to bridge the gap between advertisers and
smaller publishers with excess inventory on their
hands.
"What you'll see is that the better-known
entities are out there not having as hard of a time selling
their inventories, whereas the new companies are having a
little bit of a harder time because it's a new medium for
advertisers," said Chris Arens, director of marketing for Ad
Infuse Inc., a San Francisco-based mobile marketing startup.
"That's the biggest struggle in what we're trying to do right
now. Not all the (mobile) traffic is going to what has
historically been the big online giants. That's just an
education issue."
Ad Infuse last week hosted an
educational summit in New York with panelists from both
wireless (Pete Distler, general manager of Sprint Nextel
Corp.'s mobile ad business) and interactive advertising (Maria
Mandel, executive director of digital innovation at Ogilvy
Interactive). Another event is slated for London in November;
more will follow next year.
Not all sunshine at the
top
Of course, it isn't just the new players in mobile
that are having a hard time turning ad space into dollars. AOL
has moved aggressively-and, thus far, successfully-into
mobile, recently launching an overhauled wireless portal and a
new mobile search application. And the company's acquisition
of mobile marketing pioneer Third Screen Media helped spark a
flurry of merger and acquisition activity in the space. But
even AOL is being forced to swallow much of its valuable
inventory, according to Scott Falconer, executive VP of AOL
Mobile.
"Third Screen is selling our ad inventory;
we're able to do targeted advertising based on category of
content, geography, carrier, handset and time of day,"
explained Falconer. "Certainly, I can say that like the rest
of the industry, a majority of the inventory is not
sold."
The glut of inventory contrasts with recent
statements from Vodafone U.K. and the U.K. portal ITV Mobile,
both of which claim to have sold out of their inventories. But
those claims may have more to do with limited space in the
early days of mobile marketing than with an overwhelming
demand from advertisers.
Arens doesn't expect mobile ad
spend to increase in the next few months as advertisers and
brands tinker with how best to exploit the new medium. But it
appears that 2008 may be the year when mainstream advertisers
truly begin to invest in mobile campaigns. How successful
those investments are will likely be indicative of the mobile
advertising's long-term potential.
"What we're seeing
by looking at our pipeline is that it's a three-month
life-cycle from proposal" to deployment, Arens stated. "Q1 of
'08 is looking to be a pretty good quarter for us, with a
number of six-figure deals within that time frame. It's
looking like '08 is going to be a pretty good year. I have a
feeling that Q4 (2007) is going to be more of a testing ground
for these types of programs."
|
|
|
|
E-mail
Story
Print Story