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Smartphones have seen mobile advertising boom, finds IAB

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The adoption of smartphones has boosted traditional advertisers’ confidence in the mobile space, according to new research from the Internet Advertising Bureau (IAB) and PwC – but agencies, brands and retailers are yet to fully tap into it, believe industry watchers.

Mobile advertising has experienced a staggering 116% year on year growth (on a like for like basis), up from 32% growth in 2009. Advertisers spent £83 million on mobile advertising in 2010, according to the third annual IAB and PwC mobile study.

Entertainment and media has dominated the spend for the past couple of years, but its dominance is reducing as other advertisers – in particular financial, telecom providers and consumer good brands – see the opportunity the sector has to offer.

Smartphone adoption isn’t the only driver for the growth in spend. The way consumers are using mobile to access media has changed dramatically over the past few years.

Advertisers’ spend on search on mobile has nearly tripled from 2009, going up from £20.2 million to £54.9 million. Display advertising in the form of banner ads, text links, and tenancies experienced a rise of 62% to £23.7 million, from £14.6 million in 2009. The mobile format of pre-and post-roll adverts also experienced a rise of 492% to £1.1 million, up from £0.2 million in 2009, showing that the rich media opportunities that smartphones offer are being taken advantage of by advertisers.

Jon Mew, director of mobile and operations at the IAB, said: “This year’s research shows that traditional advertisers such as finance, telecoms and consumer goods are really starting to understand the opportunities that mobile, and only mobile, offers. Mobile advertising allows advertisers to target people on the move, and capture them when they’re most receptive. It’s an exciting time for mobile advertising, and for advertisers who use the opportunities.”

Anna Bartz, strategy manager at PwC, said: “We are witnessing patterns of growth similar to online advertising in its early stages. Increasing technology packed into handsets coupled with decreasing costs, presents brands with a tempting opportunity to target mobile consumers.”

However, Paul Childs, COO at Europe’s only global mobile advertising marketplace, Adfonic, believes that most brands, ad agencies and content owners are yet to fully exploit this opportunity and tap into the full advertising potential of mobile. “As people switch off from TV advertising and spend less time surfing the web on a PC, smartphones and tablets are becoming the devices of choice for constant and spontaneous internet access,” explains Childs. “They also open up new opportunities to integrate TV and online campaigns with mobile devices and content, and the possibility to engage more effectively with consumers through richer mobile ad units.”

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