Frost & Sullivan: Australian mobile advertising market to reach $682 million in 2018

~ Advertising on tablets to account for 70% of overall mobile ad spend by 2018

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Nov 10, 2013, 11:42 ET

SYDNEY, Nov. 10, 2013 /PRNewswire/ -- Australia's mobile advertising market is predicted to grow strongly at a CAGR of 39% from 2013 to 2018, with expenditure reaching $682 million in 2018. By that time, 70% of overall mobile advertising spend will be served on tablets, whilst 30% of adverts are expected to be served on smartphones.

Frost & Sullivan's new report, Australian Online General and Mobile Advertising Market 2013, reveals that 50% of companies plan to increase their mobile advertising budget substantially compared to the prior year. 79% reported intentions to increase mobile advertising expenditure by more than 10%.

Over the last 12 months there has been very high growth in mobile advertising expenditure, fuelled by strong growth in consumer media consumption on smartphones, but especially tablets. It is now increasingly being seen as an important part of the overall advertising strategy of both media agencies and brands.

"In the last 12 months, the Australian mobile advertising market grew strongly across all industries. "Banking & finance and automotive continue to lead the market, though retail is also seeing strong adoption," said Phil Harpur, Senior Research Manager, Australia & New Zealand, Frost & Sullivan.

Harpur elaborated, "Local mobile ad networks, such as Big Mobile, and global mobile ad networks such as InMobi and AdMob are expanding their business models within Australia. This momentum is expected to continue into 2014, assisted by the advancement of mobile-specific advertising campaigns, optimised for both smartphones and tablets."

Mobile advertising ad rates have remained stable over the past year. "Rich media mobile ad inventory is growing as a proportion of overall mobile ad inventory and has experienced upward pricing pressure. The majority of new inventory is now being produced using rich media. The mobile video advertising market remains underdeveloped, though there is evidence of innovation such as video mobile ads embedded within banner ads. Mobile search advertising continues to grow strongly in line with the growing usage of mobile search, which has increased substantially over the past few years," Harpur explained.

"The high mobile usage of both smartphone and tablets has led to an oversupply of inventory spots. A major challenge for the industry moving forward is how to drive value in mobile and tablet advertising in light of the burgeoning supply of inventory via better targeting techniques," Harpur stated.

"Higher demand is now coming for premium mobile ad solutions, which are now seen as an essential part of an integrated advertising campaign covering both offline channels, such as TV and print, and online channels, both mobile and non-mobile," finished Harpur.

Frost & Sullivan's Australian Online General and Mobile Advertising Market 2013 report forms part of the Frost & Sullivan Australian Digital Media program. All research services included in this subscription provide detailed market opportunities and industry trends evaluated following extensive interviews with market participants. Interviews with the press are available.

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SOURCE Frost & Sullivan