We forecast that global mobile ad revenue will be up 70% this year, and just surpass $US15 billion.
That will be a bit of a slowdown. In each of the three years from 2009 to 2011, global mobile ad revenues had posted triple-digit percentage growth, before sputtering and achieving 83% growth in 2012, according to IAB data.
The ongoing deceleration is a natural result of a bottleneck of sorts in mobile advertising. The easy dollars have already rushed into mobile, and now publishers and ad networks are busy persuading big global and national brands to go beyond dipping their toes. Also, the soft global economy hasn’t helped.
On a global level, paid search accounts for 54% of the mobile advertising market. That share is up from 50% in 2010. It maintains a similar share in the U.S. market as well.
We expect U.S. mobile ad revenue to jump 103% in 2013 over 2012 results, to about $US6.8 billion (that’s also a bit of a slowdown). The U.S. will account for nearly 45% of the global mobile ad market in 2013.
We believe search will continue to drive more mobile ad growth in the next couple of years, as the mobile display ad market matures (it’s still a fragmented and messy ecosystem).
But in the long-term, display will overtake search, both in the U.S. and globally.
The IAB says Latin America experienced the largest growth in total mobile ad revenue during 2012, 200%. But in terms of the global picture it’s still a blip in the landscape, and still dominated by messaging revenues.
Overseas regions also still lag far behind the U.S. in ad spend per mobile user. This is an important indicator that shows where advertisers are willing to allocate ad resources, mostly because of better ad campaign performance historically.
Marketers spend about $US9 per U.S. mobile subscriber, according to the IAB. In Western Europe, average ad spend per mobile subscriber is a minimal $US3.
Here’s a look at U.S.-only. Note how it looks very much like the above chart, because of the weight of the U.S. mobile ad market in the global picture.
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