Is mobile advertising heading for a brick wall?

Written by on September 14, 2015 in Opinion with 0 Comments

Pop up concept.There is turmoil in the advertising world. It is quite hard to work out whether it is emerging as the next big opportunity or about to hit a brick wall.

Here are some of the figures that make it hard to fathom:

Consumer and advertising expenditure on handset-based mobile media will rise twelve percent in 2015, and approach $425 Billion by 2021. Mobile will account for twenty-four percent of digital advertising this year. Strategy Analytics.

Mobile advertising specifically grew by 64.8 percent in 2014 to $31.9 billion, according to the Interactive Advertising Bureau.

Yet we are paying for the data – and the tracking software – that delivers the adverts, according to Shine’s letter to the FT. They are lobbying anyone who will listen to zero rate adverts. They also sell ad blocking software.

Ad blocking software usage has grown at 41 percent since last year, and as at June 2015, 198 million customers were using software.

We have arrived at the place that we talked of long ago. Many years ago, we assumed that much of the activity that took place on mobiles would be funded by adverts. We discussed, at length, how annoying adverts on mobile would be. We decided that there was value in paying not to see them.

One article that shines a small ray of light on the issue is this one. Two advertising executives, of all people, installed ad blocking software and were amazed at the improvement in performance of their handsets. After a day, the expectation of the unexpected and unwelcome advert faded and their experience with their mobile increased hugely. All those annoying adverts went unclicked in the depths of Facebook and Apple.

These same people believe that ad blocking should be embraced by the advertising industry. After all, they say, the industry had to reinvent itself when advertising went mobile, personal and interactive. So, now the bar is raised again and advertising is going to have to be extraordinary not to get blocked.

It is true. Currently, most people’s experience of advertising on Facebook, say, is that it is childishly bad. You post that you about to go on holiday and all you see for the next 10 days are adverts for holiday destinations, flights and hotels. You buy a fridge and you are bombarded with adverts for fridges. And all you want to do is shout ‘I just bought one, you numptyheads, why would I want to buy another one?’

We can talk about personalised, interactive, just-in-time contextual advertising until we are blue in the face. But until someone (in fact, everyone) actually does something that is personalised, interactive and contextually just-in-time, we will continue not to buy it. And the market in ad blocking software will be one to invest in.

It will be fascinating to see whether Verizon’s venture into mobile video, where they are banking on the data and advertising revenue, will buck the trend and produce an experience that people are happy with. Let’s hope so.

Meanwhile, here is a refreshingly good advert:

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About the Author

About the Author: Alex was Founder and CEO of the Global Billing Association (GBA), a trade body focused on the communications sector. He is a sought after speaker and chairman at leading industry conferences, and is widely published in communications magazines around the world. Until it closed, he was Contributing Editor, OSS/BSS for Connected Planet. He is publisher of DisruptiveViews and previously BillingViews. .

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