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Mobile ad spend to reach $1.56B by 2013: Study

Spending on mobile advertising is estimated to reach $416 million in 2009 in comparison with the $24 billion that will be spent for online advertising, according to a study by eMarketer.

While mobile advertising has remained a backseat player to print, television and online, eMarketer predicts huge growth in the industry, as long as marketers understand their target consumers. EMarketer credits the nearly simultaneous realization on the part of marketers that mobile has a great additive effect to most traditional marketing tactics.

"With its ability to bridge the gap between the online and offline worlds, mobile plays a unique and privileged role within the marketing mix," said Noah Elkin, senior analyst at eMarketer, New York. "As a channel, mobile is also highly flexible.

"It can support a number of different objectives spanning direct response and branding," he said. "Several marketers I interviewed for the report spoke in terms of mobile's additive effect.

"And ultimately, marketers who consistently integrate mobile into their online and offline marketing programs will achieve better results, not just on a channel-by-channel basis, but also across their marketing as a whole."

EMarketer made it clear that two inevitable trends will occur over the next few years: smartphones will proliferate the market in an even more rapid manner and marketers will move beyond an experimentation phase with mobile.

As these trends evolve, marketing budgets dedicated to mobile will increase steadily.

In fact, eMarketer predicts that spending on mobile advertising will grow faster than it has in past years, reaching $1.56 billion by 2013.

This estimate represents an annual growth rate of 37.3 percent between 2008 and 2013 across all principal formats, including display, search and messaging-based advertising.

2010 is inflection point
While many researchers cannot nail down a specific number for marketers, one commonality among projections is that many have identified 2010-2011 as an inflection point in mobile ad spending.

Within that span, the broad spread of carrier-offered data plans and smartphone penetration within the market are expected to reach enough of a critical mass for marketers to start thinking of mobile as a priority, rather than an experiment.

"From conversations with brand marketers and agency executives, three things surprised me: One is the degree to which integration of mobile with other channels and marketing programs has progressed," Mr. Elkin said.

"The second surprise is the nature of results," he said. "For campaigns done right, the metrics can be very impressive, much more so than online advertising. Finally, the sophistication of thinking that goes into where, how and when mobile can and should be used was also beyond what I expected."

EMarketer claims that more than 10 percent of brand and agency respondants said that mobile is a line-item that they are planning to include this year.

The report explained that a key factor in implementing mobile successfully is to understand the audience. A big part of understanding the demographic is knowing which device they are on and how they use it.

For example, iPhone owners have driven much of recent mobile Web traffic. The iPhone and iPod touch together have represented 57.6 percent of the mobile Web browser market in August 2009, according to eMarketer.

"Mobile will be the linchpin in a more integrated marketing world," Mr. Elkin said. "The growing proliferation of smartphones will only fuel the growth of additional marketing opportunities and ways for consumers to interact with brands using their mobile devices."