On the go and on the up—Mobile drives global ad spend

If the digital economy is consumer-led, then it is the smartphone that has perhaps done most to put power back into the hands of individuals. There will be nearly 4 billion smartphone subscriptions by 2025, giving consumers access to a wealth of products, services and information. Around a third of consumers report that their smartphone is their primary source of entertainment.

Mobile will overtake desktop in 2017  

It is perhaps not surprising, then, that advertising spend is going where the consumers are. In 2017, Dentsu Aegis Network’s latest ad spend report forecasts that the majority of global digital spend will be generated by impressions and clicks delivered to mobile phones. Mobile’s share of total digital spend predicted to reach 56% to overtake desktop for the first time in 2017, and increase further in 2018 to account for a total of US$116.1 billion. In terms of growth rates, this represents a rise of 30.1% in 2017 and 24.4% in 2018, driven by the increasing popularity of Video, Social and Search usage across mobile devices and the growing demand for location-based, footfall-driving campaigns. Indeed, reflecting the importance of mobile in powering growth across a range of other media:

•  Mobile-Video is forecast to grow by a strong 47.2% in 2017 and 32.6% in 2018 and make up more than 50% share of total Video spend. 
•  Mobile-Social spend is forecast to increase by 47.5% in 2017 and 34.4% in 2018. 
•  Mobile-Search is also expected to increase by 26.8% in 2017 and 23.6% in 2018, commanding over 58% of total Paid Search spend (mobile platforms and desktop) in 2017.

Emerging markets are leading the mobile charge

Given the importance of the mobile phone in emerging markets, where they are often the critical channel between citizens and government and financial services, mobile is also seeing significant growth. In India, for example, mobile ad spend is forecast to reach 41% of total digital spend in India by 2017 with a forecast year-on-year growth rate of 50.7% in 2017 and 43.6% in 2018. More broadly, the Asia-Pacific region is the second largest region in the world as far as its share of global ad spend on mobile is concerned (see chart below) and is rapidly catching up with North America.

Share of Mobile Advertising Spend by Region (2018)

Pay attention!

As mobile advertising continues to grow, the ability to deliver contextual, targeted ads that connect with consumers will be a critical challenge. The average Briton, for example, owns 3.3 connected devices (e.g. phones, tablets, Fitbits), all of which vie for consumers’ attention. Maintaining attention in a world of distraction will be essential if mobile is to continue to deliver on its advertising potential.