Mobile Advertising, Idate

  • September 2013
  • -
  • Idate

Description:

This report analyses the current development of the mobile advertising market. It includes market figures for the period 2008 to 2017, including revenue per user and fixed advertising / paid mobile app market figures for comparative syntheses. The report answers the question of whether mobile advertising should be considered as an extension of the fixed or a distinct new market, and the impacts of mobile in-app ads which are unique to mobile advertising. The ecosystem, key players and new initiatives of telcos are also examined.

Region:

world, EU27, APAC, Brazil, China, France, Germany, Italy, Japan, South Korea, Spain, UK, USA

This study includes:

- a report
- a slideshow
- a database

Methodology

The methods employed by IDATE’s teams of analysts and consultants are based on an approach that combines:
• research and validation of data collected in the field;
• the application of classic industry and market analysis tools: segmentation, competition analysis, strategic strengths, modelling, assessment and forecasts…;
• the expertise of specialists who contribute their own analytical capabilities and those of their network of market analysts.
More specifically, the tools employed by IDATE’s teams are as follows:

1/ A multi-disciplinary team of full-time consultants, specialised by sector of activity
IDATE’s analyses are performed primarily by our in-house consultants, and very occasionally by freelance market analysts. This approach allows us to capitalise on our pool of expertise through teamwork, sharing knowledge, ideas, contacts, viewpoints and key data. Each report is drafted by a team of specialists, overseen by senior consultants with a proven track record in their field.

2/ Primary and secondary research
IDATE reports and databases are compiled based on primary data obtained from one-onone interviews with the sector’s decision-makers, and on secondary data which is established by cross-referencing public sources and external databases.

3/ An integrated information centre sustained by a number of tools and proprietary
databases
Over the past 30 years, IDATE has established working and data organization methods and proprietary databases that trace the central chapters in the history of our sectors of expertise.
• Companies: IDATE’s in-house data service tracks the latest news and events to come out of the top telecom, Internet and media industry companies around the globe. Innovative firms and start-ups are monitored by the market experts in the different “Practices”.
• Markets: IDATE’s databases are derived from rigorous processing of fundamental economic variables (GDP, investments, exchange rates, demographics, etc.) and their relation to decisive sector-specific and national elements (capex, national market dynamics, etc.).
• Technologies: IDATE’s organization by Practice provides us with an efficient means of tracking innovation. IDATE’s engineers ensure in-depth understanding of the changing shape of products and services and of the latest innovations in the marketplace.

4/ Contents of the published reports
Each IDATE market report details the structures and issues at play in the market being examined, the decisive forces (technologies, regulation, consumption) and the players involved. Particular emphasis is given to market assessments and forecasts, as part of the central premise. All market reports are laid out in a clear and concise manner, and illustrated with tables and graphs of key market data and trends.
The process of drafting of a market report includes the following stages:
• analysis of the information available in the in-house databases, and review of analyses performed in the recent past;
• based on a preliminary segmentation and assessment of the market, and as part of an validated interview guide, analysts conduct interviews that enable them to validate working hypotheses;
• a market model is then established, making it possible to test the hypotheses that have an impact on the market’s development, and validated by a new round of interviews;
• and, finally, the report’s conclusions are debated with the team responsible for the project and with expert consultants from the various fields involved;
• a final proofreading and editing/revision process, prior to the production of the final version of the report which is delivered to the client.

5/ Market assessment and forecasts
• Primary data gathering worldwide.
• Market models which isolate key service consumption parameters and service pricning assumption.

Table Of Contents

Contents

1. Executive Summary 7

1.1. Mobile advertising market to continue growing 8
1.2. A market dominated by familiar names from the Internet world 9
1.3. Mobile advertising as an extension of fixed web advertising rather than a new
market enabled through apps 10

2. Methodology 12

3. Market structure and Key factors 14

3.1. Market overview 14
3.1.1. Definition 14
3.1.2. Market segmentation 14
3.1.3. Product / service trends 18
3.2. Current market estimates 21
3.2.1. Market by geographical zone 21
3.3. Key drivers 23
3.3.1. Key technologies 23
3.3.2. Privacy and regulatory environment 37
3.3.3. Mobile advertising consumption and usages 39

4. Market structure and player strategies 43

4.1. Industry structure 43
4.1.1. Value chain and Player typology 43
4.1.2. Competition structure / landscape / environment 48
4.1.3. Business models 51
4.2. Company profiles 53
4.2.1. Summary Tables 53
4.2.2. Facebook 55
4.2.3. Google 56
4.2.4. Apple 57
4.2.5. Amazon 58
4.2.6. Orange 59
4.2.7. Vodafone 60
4.2.8. Telefónica 61
4.2.9. Deutsche Telekom 62
4.2.10. SingTel (Amobee) 62
4.2.11. Verizon 64
4.2.12. ATandT 65
4.2.13. Flurry 65
4.2.14. Rubicon Project 66
4.2.15. StrikeAd 67
4.2.16. LeadBolt 68
4.3. Strategic analysis 70
4.3.1. Mobile advertising is mainly conducted through mobile web, due to easier
convergence from fixed compared to all-new app advertising 70
4.3.2. Mobile advertising market still in its infancy but can be expected to grow in the
coming years 71

5. Markets and forecasts 73

5.1. Market development factors 73
5.1.1. Analysis of growth drivers 73
5.1.2. Forecast hypotheses 74
5.2. Market forecasts 74
5.2.1. Forecasts 2013-2017 75



Tables

Table 1: Examples of mobile applications offering location-based services 17
Table 2: Worldwide mobile advertising revenue by company, 2011 to 2013 49
Table 3: Mobile display advertising revenue in the US, by company 2011 to 2014 50
Table 4: Mobile advertising activity benchmark for telcos 53
Table 5: Mobile advertising activity benchmark for telcos 54



Figures

Figure 1: Advertising revenue split between search and display formats; a comparison between
fixed and mobile 11
Figure 2: Integration of iPhone functionality in the Nissan campaign 16
Figure 3: Google AdWords’ click-to-call function 16
Figure 4: Examples of location-based ads on mobile phones 18
Figure 5: The SoLoMo concept 19
Figure 6: Example of an app install ad on Facebook mobile 20
Figure 7: Regional mobile advertising revenues, 2008 to 2012 21
Figure 8: Mobile advertising revenues by country, 2008 to 2012 21
Figure 9: Regional annual mobile advertising revenue per mobile Internet user, 2008 to 2012 22
Figure 10: Annual mobile advertising revenue per mobile Internet user by country, 2008 to 2012 22
Figure 11: Main mobile advertising key technologies by categories 23
Figure 12: Eye tracking attention evaluation on Facebook (website and application) 26
Figure 13: 24/7 Real Media's Open AdStream platform 27
Figure 14: Advertising that targets the main audience of the website lesnumeriques.com 27
Figure 15: Contextual advertising for the Shazam music application via AdSense 28
Figure 16: The Blinkx “un-roll” 29
Figure 17: How contextual advertising is integrated into an Internet video 30
Figure 18: Sponsored pages displayed on the Facebook mobile application, taking into account the
Facebook user’s profile 30
Figure 19: The retargeting process 31
Figure 20: Personalized recommendations on mobile, by Amazon 32
Figure 21: Pull-based advertising in the “WHERE” application 33
Figure 22: Push-based or geofencing advertising for Starbucks (sent by SMS) 34
Figure 23: Advertising on the “Metro Paris” application 34
Figure 24: The Real-Time Bidding process 35
Figure 25: Various kinds of data sources 36
Figure 26: While using your smartphone or tablet, how often do you fully pay attention to
advertisements when…? 39
Figure 27: How often do you notice advertising when you are using the browser or an app on your
smartphone? 40
Figure 28: Which types of ads do you pay attention to on your smartphone or tablet? 40
Figure 29: Results of a survey question about mobile ad usefulness 41
Figure 30: Advertising perceptions depending on the physical medium and the device 41
Figure 31: Mobile users’ attitude regarding the advertising format 42
Figure 32 : The initial online value chain 43
Figure 33: The introduction of ad networks 44
Figure 34 : Hundreds of ad networks complicating the value chain 44
Figure 35 : The introduction of ad exchanges 45
Figure 36 : Addition of ad exchanges further complicates the value chain 46
Figure 37: The introduction of DSPs and SSPs 47
Figure 38: The mobile advertising value chain 47
Figure 39: The mobile advertising networks market map, by MobyAffiliates 48
Figure 40: The main players dominating the mobile search and display advertising markets 51
Figure 41: Advertising ecosystem revenue sharing percentages 52
Figure 42: Verizon Precision Market Insights 54
Figure 43: The four steps to Business Success on Facebook 55
Figure 44: Mobile advertising inventory managed by Orange 59
Figure 45: Tailored media packages by Vodafone Marketing Solutions 60
Figure 46: Ad products offered by Telefónica Global Advertising Solutions 61
Figure 47: SingTel iMedia does not mention Amobee 63
Figure 48: Amobee still operates independently from SingTel 63
Figure 49: Examples of analyses by Verizon Precision Marketing Insights 64
Figure 50: ATandT AdWorks' click-to-fill ad unit 65
Figure 51: Flurry AppCircle Re-engagement 66
Figure 52: Rubicon targets publishers who are 6th to 100th for total ad display impressions 66
Figure 53: The StrikeAd Fusion platform 68
Figure 54: Ad units available from LeadBolt 69
Figure 55: Advertising revenue split between search and display formats; a comparison between
fixed and mobile 71
Figure 56: Percentage of mobile RTB ad requests by Adfonic, May to October 2012 72
Figure 57: Key forecast Figures in a nutshell 74
Figure 58: Regional mobile advertising revenues, 2013-2017 75
Figure 59: Mobile advertising revenues by country, 2013- 2017 75
Figure 60: Regional annual mobile advertising revenue per mobile Internet user, 2013-2017 76
Figure 61: Annual mobile advertising revenues per mobile Internet user by country, 2013-2017
(EUR) 76
Figure 62: Mobile advertising revenues as a share of total online revenues, 2013-2017 77
Figure 63: Breakdown of mobile advertising revenues by format, USA 2013-2017 77
Figure 64: Breakdown of global mobile advertising revenues by format, 2013-2017 78
Figure 65: Comparison of fixed and mobile advertising revenue per user, 2013 and 2017, for EU27,
USA, Japan and Worldwide 78
Figure 66: Comparison of mobile advertising revenue per user and mobile app revenue per user,
2013 and 2017, for EU27, USA, Japan and Worldwide 79

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