Summits Yellow

Record UK Mobile Ad Spend: The Industry Reacts

Tim Maytom

Earlier this week saw the IAB and PwC release their latest figures for the UK's digital ad spending in 2015, with mobile up £1bn on the 2014 figures to £2.63bn. Mobile accounted for 78 per cent of all digital growth in the period, with video and native in particular driving spending. We reached out to a panel of industry experts over what these new figures tell us about the world of mobile marketing, and where the next few years will take us.

justin taylor teadsJustin Taylor, UK managing director, Teads
“With more premium inventory available than ever thanks to outstream or native video ad formats, it’s no surprise that advertisers are spending record amounts on online video. With the demise of print publications like The Independent and El Pais, effectively monetising online audiences is now the number one priority for premium publishers. They need to find a way to deliver online advertising that works for brands, without alienating their readers.

"The next hurdle will be ensuring mobile video ads complement the mobile user experience, rather than disrupt it. We expect to see more and more video ads appearing in vertical formats that fit better with the way consumers are naturally using their smartphone or tablet.”

stephanie carr marin softwareStephanie Carr, vice president for EMEA, Marin Software
"We expect advertisers will maintain investment in paid search as the big players continue to innovate in the space. Google and Bing’s Shopping campaigns, the introduction of video results and even voice search are all examples of exciting opportunities. However, display is quickly catching up with search, driven by mobile which has yet again seen huge growth.

"As people use mobile devices more than ever to research, browse the web, check social networks, and most importantly for advertisers, click on ads, marketers are amending their ad spend accordingly. We are now finally seeing mobile ad spend catch up with media consumption.”

antoine de kermelAntoine de Kermel, managing director for EMEA, TVTY
“These results show that unsurprisingly, mobile’s rapid growth is not slowing. Our daily lives now revolve around our mobiles from shopping, to chatting on social media and consuming news. The opportunities for marketers to capitalise on these daily moments are clear.

"It’s important that while there is a surge in mobile advertising, brands target their spend accurately. With advertising bombarding consumers around the clock, it’s never been more essential for brands to react instantly and align digital campaigns with the moments that make consumers pick up their phones.”

jonathan_milne_celtraJonathan Milne, chief revenue officer, Celtra
"The IAB's figures show that 'mobile first' is now a reality for marketers who have followed consumer behaviour with their advertising budgets. Importantly, brand advertising budgets are now being deployed significantly on mobile, which is no longer seen as a performance channel. Moreover, advertisers and their agencies are leading with mobile and this increased investment has led to improved mobile creatives, with video and other engaging formats becoming prevalent.

"With mobile now mainstream, brands are shifting their focus towards building trust with consumers through improving the ad user experience. The priority for marketers is now fine tuning to achieve the right balance of well targeted audiences, brand safe environments, viewable placements and the right relevant message to further increase their ROI."

gavin stirrat voluumGavin Stirrat, global managing director, Voluum
"Two major trends are evident in today's release of adspend numbers. The first is the power and value of mobile as part of the digital marketing mix, with mobile making up almost a third of all spend, and more tellingly driving nearly 80 per cent of the year-on-year total growth.

"And secondly, programmatic spend now represents the majority of all display, making up 60 per cent of trading (up from 47 per cent last year). These trends reflect the fact that households now contain an average of 3.5 mobile devices – making mobile the most effective medium to reach consumers - and clients and agencies are demanding the efficiencies and transparency that programmatic offers.

"Whilst these numbers are a validation of the industry’s efforts, there remain challenges which have yet to be properly understood and managed, including fraud. However one of the biggest challenges the industry is likely to face, from clients through agencies to tech platforms, is finding skilled resource to manage the continued growth in mobile and programmatic."

Thomas-HussonThomas Husson, vice president and principal analyst, marketing & strategy, Forrester
"The UK mobile ad market is definitely leading the pack in Europe so it is good to see mobile ad spend really taking off in a significant way because it demonstrates that marketers are finally maturing and following the behaviors and expectations of their customers. Beyond the absolute value, what I find more interesting is to put things in perspective: what's the share of mobile in the overall marketing-mix?

"The answer is quite simple to me: not what it should be. Marketers are missing an opportunity here because there are not able yet to fully measure the impact of mobile on their overall marketing objectives. No doubt mobile is and will continue to be the growth engine in the years to come because consumers will take control of the brand relationship via their smartphones and because increasingly marketers will realize mobile can also augment their traditional marketing efforts – including offline.

"This is just the tip of the iceberg though: beyond advertising, marketers need to deliver utility and content to meet the growing expectations of their customers and serve them in their mobile moments."

Harry Dewhirst BlisHarry Dewhirst, president, Blis
With £8.61bn spent on UK digital advertising last year and ad spend on mobile devices driving the majority of this growth – up 78 per cent year-on-year – this is a fantastic opportunity for those brands that understand mobile consumer behaviour. Billions of people have an intimate relationship with their mobile devices so it's no surprise that marketers want in on the action. Is it possible for brands to enhance this relationship and improve the mobile experience for users by providing value?

"My advice would be for brands to knock gently and err on the side of 'less is more' when it comes to mobile intrusions; make life easier for consumers on their mobile devices; treat your mobile relationships as being precious, and work every to make those relationships better.

Nigel-Clarkson-YahooNigel Clarkson, managing director and country commercial director, Yahoo
We are not surprised to see a continued growth in mobile advertising revenues in 2015. As connected devices and data capabilities become increasing 'mobile', we are seeing increases in traffic to mobile devices, so it is logical that revenues will move that way too. Of particular interest to us is the continual growth of online video and native advertising. As a market leader in premium, in-stream native ad solutions, we are already seeing huge increases in demand for our multi-format, cross device native offering, which is a major driver of our mobile revenues.

"These formats offer a premium ad experience, are resistant to ad blocking and pass the IAB agreed LEAN principles of what constitutes a 'good' advertising experience for consumers. Backed by our huge data resources, we are also able to make the experience more relevant for our customers, which is what both they and the clients we work with want."

Criteo-Jon-BussJon Buss, managing director for northern Europe, Criteo
"Mobile has totally changed the retail environment. Our smartphones are now at the centre of our whole shopping experience – from research to consideration to purchase. According to Criteo’s latest Mobile Commerce Report nearly four-in-ten consumers shop on multiple devices and complete those purchases on a mobile device almost a third of the time.

"While it’s encouraging to see UK businesses ramping up mobile spend accordingly, they must remember they are selling to people, not devices. Mobile web and app experiences need to be personalised to convert browsers to buyers. In addition, many advertisers are still struggling to link the multiple profiles generated by a person’s devices and apps. This restricts their ability to optimise online campaigns and creates a fragmented consumer experience.

"The businesses that will set themselves apart are those that can identify individuals in real-time across devices, and use these insights to deliver relevant and valuable interactions across all customer touchpoints."

simon baptist tuneSimon Baptist, director of business development for EMEA, Tune
"It was really exciting to read the IAB UK Digital Adspend 2015 study and see that with a year-on-year 60.3 per cent growth, mobile has become the growth engine driving digital advertising spend in the UK over £8bn.

"When looking at the top spending verticals on mobile display, it's interesting to see Consumer Goods as the top vertical. Alongside media consumption time switching to mobile and with tools like deep linking really opening up mobile apps, the Retail and Travel sectors are starting to see a lot of commercial success from mobile, I would expect them to challenge Consumer Goods for the top spot in 2016."

alex hewson m&c saatchiAlex Hewson, EMEA head of media, M&C Saatchi Mobile
"This is a watershed moment for the industry as this demonstrates the confidence major brands now have in the channel. Unlike previous years where digital desktop spend was growing rapidly, we do not assume the majority of this significant increase in mobile spend is been driven by search - especially as you look at how key industry players such as Facebook are generating vast revenues based on display app install formats.

"We’re seeing other big digital hitters such as Google evolve with the industry and re-imagine their focus. One of their most recent Google products on mobile is App Search and this shows how they are adapting to the prevailing market trend of performance based app marketing.

"Moreover, with the UK mobile market reaching maturity, the increase in demand is driving media cost up and forcing marketers and agencies to be smarter. Gone are the days of pushing out thousands of ‘cheap’ banners and hoping a few would stick. Brands have to be diligent in targeting and measurement, they need to re-imagine creative for the small screen, and they need ensure that they are setting the correct KPI’s to achieve success on mobile."

xAd Theo TheodorouTheo Theodorou, head of EMEA, xAd
“Figures from the IAB and PwC are the latest to shine light on the booming world of mobile adspend. This is not only great news for the mobile marketing industry but great news for ‘on the go’ consumers. With mobile now accounting for 78 per cent of digital ad growth, this long term shift exemplifies a change in focus to what is most beneficial when marketing to consumers – greater relevancy and precision.

"Given its intrinsic portability, mobile enables brands to reach consumers at the right time and the right place and as UK marketers increase their adspend in this area, we will no doubt witness a further uptake in programmatic location-based marketing.

“What is now imperative is that the excitement we’re seeing is converted into delivering smart, creative content that make the most of mobile’s unique format, whether it be vertical video or more relevant, dynamic display ads. Should marketers keep to this, 2016 will almost certainly be a rosy year with plenty of potential for successfully targeted campaigns that put the consumer first.”

antti-pasila-5760x3840Antti Pasila, founder and chief commercial officer, Kiosked
“With many major events like the Olympics and the EU referendum gathering the world’s attention in the coming months, brands are already investing more resources than ever into connecting with consumers digitally. Mobile marketing in particular ensures brands can develop better targeted campaigns – therefore the increased spend in this sector will mean for more relevant and timely messages delivered to the right consumers.

"It is unsurprising, considering the huge potential for one-to-one marketing, that mobile marketing adspend is on the increase. By using tracked data and demographics to identify the interests of specific individuals, brands can reach the right consumer with pinpoint accuracy. Now, more than ever, it’s time for marketers to harness advertising automation to make campaigns work that extra bit more effectively.”

Conor Shaw, Managing Director, Marketo EMEAConor Shaw, managing director for EMEA, Marketo
“The IAB and PwC report is further evidence that the industry is waking up to a more personal approach to communications. With mobile spend on the rise and programmatic following close behind, brands are wising up to the need to deliver meaningful communications at scale.

"Innovations in personalisation technology have allowed marketers to learn customer buying patterns and the context of where someone is in their decision journey. This insight helps deliver more effective, large scale online and mobile marketing campaigns, that engage customers at the crucial moment to the individual.

“This focus on tech innovation to support industry growth is set to thrive in the years to come. Despite the many issues facing the industry, adspend in booming and through further innovations, the future is set to be even brighter.”

Richard RobinsonRichard Robinson, managing director for EMEA, Turn
“We are living in an increasingly mobile-focused world where consumers are rarely separated from their smartphones or tablets. Therefore it is great to see the industry recognising the potential that mobile marketing brings to connect with consumers via this channel.

"However, marketers should be sure to think in terms of an audience-first, as opposed to channel-first, approach. Using data, marketers can locate the optimum time, channel and content for interacting with their audience at different points in the customer journey data. Data-led campaigns will bring about the chance to cut out irrelevant ad noise and allow for true 1:1 interactions across all relevant channels, which will build loyal and lasting brand relationships.”