While this may well show an upward trend, such figures are small change in the ad business and the mobile ad sector still accounts for only a small slice of total digital advertising.
In the US, some key brands such as Toyota, General Motors and Capital One are now repeat users of mobile ads while the video ad format is also now proving increasingly popular in the motion picture and entertainment business. Indeed, all major brands see the app itself as a key element of the digital presence. More importantly, app developers see ads within apps and games as very attractive. The future breadth of mobile advertising possibilities is huge.
However, before app-related mobile advertising really takes off and reaches its full potential, most mobile ad in many parts of Asia will continue to be delivered via more traditional mobile channels such as SMS, MMS, unstructured supplementary service data (USSD) and ringback tones. This is because smartphone penetration in the high-growth markets is still relatively low and the only real way to reach all subscribers is through messaging. Penetration is barely 10% in places like India and Latin America.
The growth of smartphones is strong in mature markets with half of all handsets sold in Japan classified as smartphones. In the US, smartphone penetration is forecast to account for half of all handsets by the end of 2011.
Today, messaging channels such as SMS and USSD allow brands to communicate with any consumer with any phone in any market. Whether for its ability to ‘reach’ a target audience, its ability to obtain an immediate response from that audience, or for a creative simplicity provided by the medium, it is hard to beat messaging as a communication vehicle.