Mobile web spends up 100 per cent, as in-app advertising drops, says Smaato

Smaato’s new report states that in-app ad spending has fallen by 10 per cent over last year. Could social apps like Facebook and Twitter be a reason behind this?

e4m by Abhinn Shreshtha
Updated: Oct 6, 2015 9:21 AM
Mobile web spends up 100 per cent, as in-app advertising drops, says Smaato

A global report by digital ad platform Smaato sheds new light on how companies are approaching digital ad spends. The report entitled “Global Trends in Mobile Programmatic” report for H1’15, determined that while apps still command the market for overall ad spending on mobile, spending on the mobile web increased by 100 percent over the past year.

Smaato analyzed data from billions of mobile ad impressions served on its exchange during the first half of 2015 to reveal that mobile web usage is soaring. According to the report spending on the mobile web now accounts for 38 per cent while the percentage spent on apps dropped to 62 per cent from 72 per cent last year.

The report also stated that Facebook and Twitter could be the driving force behind this surge in mobile web usage. A reason for this could be that social media apps are increasingly being used by publishers to spread their content; they contain a large number of posts with external links. So, these might actually be driving more traffic to the mobile web and hence away from apps.

So if Facebook and Twitter’s apps are actually reducing overall app usage, how does it affect in-app advertising?

“While Facebook and Twitter are giant apps that have huge user base, it has to be noted that an average mobile user in Asia has over 30+ different apps installed. As such, in-app advertising is still growing in more verticals other than social networking services,” explained Malcom Wong, MD, APAC at Smaato.

 “The shift to mobile began with the mobile web and then apps took over,” further added Ragnar Kruse, CEO of Smaato. “Although we can’t say for sure whether we’re looking at a huge comeback of the medium, the fact remains that publishers and advertisers can’t afford to ignore the mobile web. Mobile ad strategies - whether it be the size of ads or the use of rich media - must be created with both app and mobile web usage in mind.”

While the United States continues to be the top country on Smaato Exchange for mobile ads inventory and spending, Asia Pacific countries recorded the highest growth during the first half of 2015 compared to the same period in 2014. China grew by 315 per cent, India, 279 per cent, Singapore 225 per cent, Indonesia, 142 per cent and Malaysia, 126 per cent.

 In terms of the target audience, Smaato said advertisers are “doubling down” to target families and parents on mobile. According to the report, spending on this demographic increased by over 300 per cent over the past year, while the second most lucrative vertical only rose by 87 per cent. “Advertisers will pay nearly 4 times as much to target someone by age and/or gender. Publishers who pass this information are seeing dramatically higher eCPMs,” the report stated.

Bigger is better
Another facet of the study was that larger ad formats have found popularity among advertisers, especially in developing markets. The report stated that spends on larger ads (300x250 and up) rose by over 250 per cent, in contrast with the overall spend on the original app-only banner ad size (320x50), which only increased by 30 percent. Spends on larger banner ads (320x480) interstitials grew by 325 per cent.

It is a common perception that the larger the ad format, the more chances of a person actually seeing the ad. However, with new ways of thinking about ad intrusion, many have started to questions this wisdom. Wong agreed that larger formats do in general see a higher average click through rates.

“The key point here is to spread the marketing message via mobile display banners. For advertisers who want a greater emphasis on a key marketing message will prefer larger ad formats. For publishers, some might find larger ad formats intrusive to their user’s experience in the app and some mobile users do not find larger formats receptive. It is important to balance a user’s experience and flow, so that the ads will be more appealing and enticing to users. Basic smaller banners are generally accepted by all mobile users, while the clicks might not be as high, but it does sieve out interested users from its basic marketing message, those will still click to find out more,” he opined.

Programmatic has huge potential in India

With digital and mobile marketing becoming a massive piece of the overall pie, the future for programmatic buying is bright in the country opined Wong. For example, the report placed India as the third highest spender on mobile and the second biggest in terms of supply, with a growth of 279 per cent over 2014 globally

“Mobile adoption rates grows and users are increasing keen on having smartphones. Segments like electronics, retail, banking, food and beverages, fashion, education, etc are spending big on digital. India is growing in programmatic usage for brands who wish to specifically target a defined set of audience. We are seeing more targeting done on parameters of gender, age and specific location,” said Wong.

When asked about specific trends in the digital ad buying landscape, Wong said more players are moving moving from a pure ad network to incorporating RTB buying into their offerings to clients. “Advertising agencies are moving more buys into programmatic as now targeting and engaging the right audience is more important. We see a future trend of big data and retargeting coming mainstream in India,” he said.

For more updates, be socially connected with us on
WhatsApp, Instagram, LinkedIn, Twitter, Facebook & Youtube