It’s been a tumultuous few months for the mobile advertising space, what with federal regulators looking for possible anti-competitive practices in the Apple vs. Google face-off, questions swirling about how Apple will treat AdMob ads in its iAd mobile advertising ecosystem and Apple’s launch of its much ballyhooed iAd system on July 1.
So, does that mean it’s “game over” for the independent mobile ad networks? Not if you ask them. But analysts also seem to agree that it’s still early days for the mobile ad space, and few are declaring a clearcut No. 1 at this point.
The two “big” mobile ad networks boast name recognition, but that doesn’t mean everyone wants to buy through those networks alone, says ABI Research practice director Neil Strother. “It’s incorrect to say just one horse is going to win this race,” he says. While consolidation will come down the road, “right now, it’s more of a free for all.”
And given the market size, it appears there’s plenty of room. Over the next five years, ABI expects spending on mobile display ads in the United States, estimated at just under $313 million today, will almost quadruple to exceed $1.2 billion in 2015. And mobile display ads are just one method available to mobile marketers.
Ads within applications – of the type Apple is pursuing in the name of making money for developers’ sake – as well as SMS, banner, search and video are all mediums that marketers are including in their mobile campaigns. Some of them combine direct response with branding, Strother says, and it’s hard, if not unwise, to pick one as the “best” mobile mode of ad delivery. It boils down to what type of market the advertiser is going after and who they want to reach, he says. “What will continue to happen is advertisers pick and choose whatever fits their needs.”
Analysts agree it’s difficult to compare the independent ad networks in a strictly applesto-apples comparison. Each comes with a slightly different bent. Jumptap’s original claim to fame was in the mobile search space before morphing into a mobile ad network. Greystripe has been focused on advertising associated with mobile games, but it’s also touting its ability to create Flash content for the iOS platform. Millennial Media has been pretty consistent with its method of cross-platform ad serving technology since its beginnings in 2006.
In June, Apple CEO Steve Jobs announced that advertisers at that time already had committed $60 million to iAds for the second half of this year. But for months prior to that, independent ad networks were reporting fantastic growth – and they’re all making claims akin to the “fastest,” “biggest” and “best” claims by operators.
Last November, Millennial said it reached more U.S. consumers on mobile devices than any media company large or small. Greystripe claims to be the “world’s leading independent mobile advertising network.” Jumptap says it delivers engaging ads on the “largest, highest quality, premium mobile ad network.” It also promises “better targeting and the most relevant ads, leading to higher click-through and conversion rates,” as well as greater ROI to advertisers and more revenue for mobile app developers and publishers and operators.
Considering those self-described attributes, it’s not too surprising that no single analytic firm has sought to do an independent audit of the mobile ad networks. Which criteria do you use to measure them by? Mark Donovan, senior analyst at comScore, says comScore doesn’t compile data on the networks’ size for several reasons, one of which is the difficulty around which measurement to use – revenue, impressions, quality of impressions or something else.
Chetan Sharma, president of Chetan Sharma Consulting, notes that Millennial and AdMob (now owned by Google) have been publishing monthly reports on some of their stats, but those are not independently audited, either. He takes the lack of an independent auditing firm as a sign the space is just not that mature.
Bob Walczak, CEO of Ringleader Digital, which was founded in 2005 and works with various mobile ad networks, points out that online advertising took more than a decade to mature and mobile has the same challenges that online did. And while many expect the mobile ad network space to consolidate, a lot more parties – from the online world – might decide to join the party.
The mobile sector in general, including the device side with newer entrants like Dell and HP, is seeing new entrants, and mobile advertising is part of that trend, says comScore’s Donovan. “What you see is all these various companies circling the mobile space, and they’re watching … how consumers are being trained to download apps and they have very big dollar signs,” he says. “Nobody wants to be left behind.”