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What Ever You’re Spending on Mobile, Spend More

IDG Global Solutions 

That’s the key piece of advice for marketers this year from IDC’s Karsten Weide. He reported that mobile advertising grew 88% in 2012 to $4.5 billion from $2.4 billion in 2011.

At the BtoB Digital Edge conference in March 2013 in San Francisco, Weide spoke with IDG Global Solutions Director Howard Sholkin, who asked Weide for his predictions about digital marketing for the rest of this year…

Facebook’s Growth Slow-Down Causes Market Share Loss

By: Karsten Weide, Program Vice President, Media & Entertainment, IDC

Facebook’s domestic advertising growth has slowed dramatically, from growth rates in the 60s% in the first three quarters of 2011 to 30% in 4Q11 and now to just 21.2% in 1Q12. This has led to an actual market share loss after what seemed to be an inexorable rise, from 13.9% of U.S. display advertising in 4Q11 to just 12.0% in 1Q12.

Desktop search advertising is rapidly losing market share to mobile advertising in the United States. That is one of the findings of IDC’s latest Worldwide and U.S. Internet Advertising Spending Report (IDC #235593, forthcoming) for the first quarter of 2012. While search advertising’s share was 54% in 1Q10, it has shrunk to 42.4% in 1Q12. Mobile advertising’s share on the other hand grew from 2.1% to 9.8% during the same period. Desktop display advertising is affected by mobile growth as well, but to a lesser extent. Search is affected more by mobile growth than display because the last three quarters of mobile advertising go toward mobile search ads. We expect a further decline as advertisers divert more of the budgets they transfer from traditional media onto the Internet to mobile advertising rather than PC-based advertising.

IDC’s report also found:

  • Worldwide online ad spending grew by 18.7% from $20.0 billion in 1Q11 to $23.7 billion in 1Q12.
  • U.S. spending increased by 18.7% from $8.2 billion in 1Q11 to $9.7 billion in 1Q12. IDC forecasts U.S. spending to grow 18.6% to $9.9 billion in 2Q12 and predicts 17% growth for the entirety of 2012, with total spending amounting to $41.7 billion versus $35.7 billion in 2011.
  • Yahoo! may be coming out of its U.S. sales slump. While Yahoo!’s net domestic ad sales declined in the past five quarters, it is now back to growth, if at a weak 1%. However, it is too early to tell if the current recovery is here to stay. Before this slump and recovery, Yahoo! had experienced a first cycle of downturn and improvement, only to end up in trouble again.
  • Search ads grew by 8.8% from $3.8 billion in 1Q11 to $4.1 billion in 1Q12. Search ads’ market share declined from 44.5% in 4Q11 to 42.4% in 1Q12. Google’s net U.S. search ad market share increased slightly to 59.8% in 1Q12 (58.2% in 4Q11), Microsoft stayed at second with 7.1% (8.7% in 4Q11), and Yahoo! ranked third again with 7% (6.2% in 4Q11).
  • Display advertising grew by 14% from $2.6 billion in 1Q11 to $2.9 billion in 1Q12. Display advertising’s market share fell from 30.7% in 4Q11 to 30.2% in 1Q12. In display ads, Google extended its lead, with a market share of 25% in 1Q12 (21.4% in 4Q11). Facebook stayed in the number 2 position, with a market share of 12% (14.0% in 4Q11). Yahoo! was number 3 with 11.1% (12.2% in 4Q11), and Microsoft was number 4 with 8% (6.8% in 4Q11).
  • Mobile advertising grew by 150.2% from $0.4 billion in 1Q11 to $0.9 billion in 1Q12. Mobile advertising’s market share grew from 7.1% in 4Q11 to 9.8% in 1Q12.

Worldwide Internet advertising sales have shown fast growth even in this time of economic uncertainty. In the U.S., we expect solid growth in the mid- to high-teen percentage range for 2Q12, but keep in mind a straw can break the economy’s back at any time (we are particularly worried about the European Euro currency and debt crisis and the stalemate and acrimony in domestic politics), which would result in low teen even negative growth rates or in 3Q12 and after. However, even if that were the case, we think that Internet advertising’s market share of all advertising across all media would continue to increase as it has in the recent “grand recession”.

 

How to Build a Better Banner Ad

eMarketer, 12/13/10

Pity the standard banner ad, the workhorse of the webpage. It does not dazzle with video or rich media or annoy visitors by popping up or under other content. Declining clickthrough rates appear to have stabilized at a mere 0.09% in 2010, falling from a fractional 0.15% in 2008, according to a recent report from MediaMind.

And consumers scorn them: 43% of respondents to an online AdweekMedia-Harris Poll said they ignored or disregarded internet banner ads more than paid search ads and those in traditional media—TV, radio and newspapers.

Read more

Google Expected to Outgrow Apple in Mobile Display Ad Market in 2011

All Things Digital, 12/6/10

The mobile advertising market is ballooning, as is Google’s share of it. Of the $877 million spent on mobile advertising in the United States this year, 59 percent of it went to the search sovereign, according to an updated assessment by IDC. Meanwhile, Apple claimed just 8.4 percent share, Yahoo 5.6 percent, down from 7 percent last year, and Microsoft 4.3 percent, down from 6.3 percent.

Clearly, Google rules the mobile ad market in the States in much the same way it dominates search. That said, it’s important to note that the mobile ad market as defined by IDC includes both search and display ads and that the advertising business of some of the companies figuring in IDC’s report doesn’t extend to mobile search.

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Google Campaign to Build Up Its Display Ads

NY Times, 9/21/10

Google, the online search ad giant that rarely advertises, has decided it needs to advertise the fact that it is in the online display advertising business.

And if that is not enough advertising about advertising, it has picked one of the most crowded advertising venues to get the message out — Times Square.

For all of Google’s success, its business has been built on search ads, the simple four-line text ads that appear with search results. Google does not get as much attention for its display ads, which include images, video and audio, even though those ads appear on YouTube and the million Web sites using Google’s display ad network.

Read more

Google Instant: Big Changes for Users, Publishers, Marketers

IDG News/NY Times, 9/8/10

Pursuing speed, Google now refreshes search results while people type queries, which could usher in major changes for end users, advertisers and publishers.

Announced on Wednesday, Google Instant presents and adjusts search results and their accompanying ads on the fly as users enter search terms in the search engine’s box.

The intention is to compress the loop of entering queries, scanning the search results, refining the query and checking the new results, a process that may be repeated multiple times and sometimes leads to frustration.

Read more