Mobile advertising expenditure to reach $41.9bn by 2017

Mobile & tablets

by CBR Staff Writer| 22 January 2014

The spending is expected to grow to $18bn in 2014.

Global mobile advertising expenditure is expected to reach $41.9bn by 2017, according to a report from the analysis firm Gartner.

According to the report, the spending is expected to grow to $18bn in 2014, rising from the estimated $13.1bn in 2013, while a major part of the revenue is expected to come from display formats and the video segment is expected to experience the highest growth.

Gartner research director Stephanie Baghdassarian said over the next few years, growth in mobile advertising spending will slow due to ad space inventory supply growing faster than demand, as the number of mobile websites and applications increases faster than brands request ad space on mobile device screens.

"However, from 2015 to 2017, growth will be fueled by improved market conditions, such as provider consolidation, measurement standardisation and new targeting technologies, along with a sustained interest in the mobile medium from advertisers," Baghdassarian added.

During the forecast period, mobile display ad formats are expected to be the biggest category of ads which is expected to move to a mobile web display after several years of higher growth in in-app display.

The search/map ad types are expected to benefit from increased use of location data gathered from users either automatically or through the use of apps like Foursquare and Pinterest.

Though the ad spend growth is expected to be distributed equally across the globe, North America is expected to contribute to most of it because of the high growth in the regions' advertising budgets along with the shift to mobile, the analysts said.

Gartner research vice president Mike McGuire said North America is the region with the strongest general advertising focus and investment.

"Overall advertising budgets are the highest, so when a portion shifts to mobile, in a multiplatform approach, it immediately impacts the market's scale," McGuire said.

Asia/Pacific and Japan are expected to have slow mobile ad growth between 2012 and 2017, while China and India are anticipated to contribute more towards mobile advertising growth due to expanding global and local brands for middle classes.

Emerging markets like Russia, Brazil and Mexico are expected to add to the mobile advertising growth in Latin America, Eastern Europe, the Middle East and Africa.

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