Mobile Video Advertising – Why there is a positive future ahead…

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The market for mobile advertising is growing at high speed. More and more companies invest their first advertising budgets (although still not huge…) in apps, onsite or instream commercials. In 2012 the market for mobile advertising is said to increase to 1,5 Billion USD. In 2010 mobileSquared estimated the size for the mobile advertising market at 800 Million USD by 2015, and this sum is expected just for Germany.

One of the main drivers of this development could become mobile video advertising. Looking at the numbers of researchers and analysts, there is a bright future ahead. The market research company Strategy Analytics saw a growth by 958% of mobile video commercial views. They published figures from April 2012 which illustrate how the mobile video advertising market might be growing. While they counted 108 Billion mobile video views 2011, they expect that the market more than doubles to 280 Billion for 2012.

The challenge for mobile video advertising was partly based on the size of smartphones which did not allow massive advertising opportunities. Partly it was lacking the believe of the management in mobile video advertising up to now. And when we look at the minimum volume of ad campaigns in Apple’s iAd program which was downsized from 1 Million to 100.000 USD, it shows that expectations were bigger than the first mobile budgets. Often traditional campaigns are simply extended to mobile without bigger creative invest.

However, this might change with mobile video advertising.

The actual „viewing time“ of video commercials in audio-video content is still just 1,5%, found Comscore. A recent study by Juniper Research stands against this and forecasts a “viewing time” for mobile TV of 186 minutes per month in 2014. That offers a lot of opportunities for commercials.

The content offering will also change with the future of the social web. In 2010, some Cisco research stated that 57% of the Internet traffic in 2014 will be audio-video content. This outlook gets support from the massive use and sharing of video content in social networks. And if we think about the fact that Facebook already has 488 Million mobile users, then it comes as no surprise that many social media advertising suppliers like ebuzzing, Hallimash oder unruly try to conquer the social video advertising market.

The creation of banners will still be responsible for the length of the viewing and staying time. According to some new insights of Medialets the mobile „engagement stimulus“ of users increases by 35% when video content is displayed. Those users that opened or expanded a banner stayed 20 seconds with the ad format. The integration of video or product catalogue information propelled the staying time with mobile banner formats from 20 seconds to more than one minute, said Medialets. Apart from that, comScore Video Metrix published some stats showing that video ads surpassed the 10 Billion mark and showed an increase by 117% year-over-year.

The development is positive which we can also see in these interesting insights. No surprise that Nielsen forecasts a growth of 70% for the mobile advertising market. And mobile video advertising will get a good chunk of it.

Will the tablet be the catalyst in this development? Sure… By 2013, 47% of the U.S. Internet population will own tablets (117.4 million users). One in ten tablet users watches online video daily according to comScore. Just think about the parallel usage of mobile devices like tablets and smartphones with TV (especially in Prime Time), there could be fantastic opportunities for marketers and their agencies to create intelligent convergent multi-platform campaigns.

Isn’t this some great outlook for mobile video advertising…? if you have some more figures you can add, let us know…

PS: These numbers were put together from me for my moderation of the dmexco Night Talks 2012 (see picture).

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