Mobile already accounts for more than half of digital ad spending in the US, and its share is growing. Topics in this webinar include: Why even though overall spending skews toward mobile, most brands don’t think they’re spending half their digital budgets on the channel; What opportunities lie in location-based marketing beyond geofencing; Why marketers need to embrace ad IDs and cut the cookie cord; Which metrics to monitor and get the most out of mobile measurement; Why creative is in crisis on mobile.

1. © 2016 eMarketer Inc.
Made possible by
Mobile Advertising:
Five Things You Need to Know Now
Cathy Boyle
Senior Analyst, Mobile
February 4, 2016

2. © 2016 eMarketer Inc.
Mobile Advertising
The definition of
‘mobile’ has
expanded

3. © 2016 eMarketer Inc.
73.6% of US adults will use smartphones
How widely used will the various mobile device
types be in 2016?
53.6% will use tablets
25.5% will use
wearables

4. © 2016 eMarketer Inc.
Five Things You Need to
Know Now

5. © 2016 eMarketer Inc.
Digital advertising = mobile advertising
1

6. © 2016 eMarketer Inc.
Mobile ad spending far exceeds desktop
Mobile 2X
Desktop
Mobile 2.3X
Desktop
US Mobile Ad
Spending (billions)
US Desktop Ad
Spending (billions)
$25.08 $24.60
$26.49
$28.21
$42.01
$50.84
$57.95
$65.49
2016 2017 2018 2019
Source: eMarketer, Sept. 2015

7. © 2016 eMarketer Inc.
The amount spent on mobile advertising will
approach television levels in the US in 2019
Television
Mobile
Print
Radio
Billions
In 2019, mobile ad spending
will trail TV spending in the
US by just 19%
$72.70
$78.28
$42.01
$65.49
$28.19 $27.43
$15.18
$15.28
2016 2017 2018 2019
Source: eMarketer, Sept. 2015

8. © 2016 eMarketer Inc.
Yet few brands report spending a majority of
their digital budget on mobile
“No [media] planner is planning 60%
mobile today. I’ve seen estimates
as low as 7%, and the highest
I’ve seen is 12%. They’re planning
60% or 80% in desktop.”
—Richy Glassberg, CEO of mobile ad server
Medialets

9. © 2016 eMarketer Inc.
‘Planned spend’ vs. ‘actual spend’ explains the
disconnect
Think cross-device and
platform-based buying
 Search
 Social
 Programmatic

10. © 2016 eMarketer Inc.
Spending patterns differ between mobile and
desktop advertising
Search
Search
Display Display
$14.72
$10.70$11.42
$10.58
2014 2015 2016
US Desktop Ad Spending
(billions)
$8.72
$18.54
$9.65
$21.58
2014 2015 2016
US Mobile Ad Spending
(billions)
Source: eMarketer, Sept. 2015

11. © 2016 eMarketer Inc.
Embrace mobile identifiers
(Cut the cookie cord)
2

12. © 2016 eMarketer Inc.
The alternative? Losing sight of your customers
and prospects
US adults spend the
bulk of their digital time
using mobile devices,
where cookie-based
tracking is limited

13. © 2016 eMarketer Inc.
Mobile’s two
classes of
identifiers
need to be
stitched
together to
understand
consumer
behavior
In-App ID
 Apple’s
Identifier for
Advertisers
(IDFA)
 Android’s
Advertising ID
Web ID
 Cookies (Android,
predominantly)
 Device-recognition
methods

14. © 2016 eMarketer Inc.
The vast majority of marketers still rely on
cookie-based tracking
91%
Cookies
Data used by US marketers to identify
users and build profiles
77%
Mobile/Device
IDs
vs.
Source: VB Insight, Sept. 2015

15. © 2016 eMarketer Inc.
Digital advertising has reached the
location tipping point
3

16. © 2016 eMarketer Inc.
A majority of US advertisers use mobile location
data to achieve success
56%
of Agencies
rated the use of mobile location data as
one of the most important digital
marketing tactics
53%
of Brands
Source: Hanapin Marketing, Aug. 2015

17. © 2016 eMarketer Inc.
 Location-based ad targeting (proximity targeting)
 Geobehavioral ad targeting
 Consumer insight and audience building
 Online-to-offline measurement
Marketers use location data in multiple ways
(It’s not all about proximity targeting)

18. © 2016 eMarketer Inc.
Proximity targeting is the most common use of
mobile location data
 38% of US mobile
ad dollars will be
spent on
location-targeted
ads this year
 That share will rise
steadily over the
next four years

19. © 2016 eMarketer Inc.
Digital shoppers
in particular
appreciate
location-
targeted ads
68% of US digital
shoppers in Adadyn’s
poll thought
location-targeted ads
were useful

20. © 2016 eMarketer Inc.
To increase
their ads’
relevance,
advertisers
overlay
geobehavioral
data with
contextual
data so as to
fine-tune their
targeting
55% of marketers
in the US and
Western Europe
used contextual
data-driven
marketing
frequently

21. © 2016 eMarketer Inc.
Understanding
smartphone
users’
behaviors in
the physical
world is
fueling the
rise of
location-based
retargeting
86%
Home
47%
Work/School
57%
Shopping
47%
On-the-Go
Source: YP and IDC, Sept. 2015
Locations where US smartphone users
conduct web searches

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Analyzing
visitation rates
to specific
locations
provides
valuable
insights for
retargeting and
building
audience
profiles
57%
Shopping
47%
On-the-Go
Playground
Bar
Gym
Home Depot
Sephora
Toys “R” Us

23. © 2016 eMarketer Inc.
Still, a growing number of US smartphone users
shop on their phones from home
 Online-to-offline
(O2O)
measurement is
critical
 Location data is
playing a key role
in O2O
measurement

24. © 2016 eMarketer Inc.
Mobile is measurable
(But you need to know what you’re measuring)
4

25. © 2016 eMarketer Inc.
40% or more of
US marketers
said they were
‘somewhat to
very effective’ at
measuring mobile
ad effectiveness
(But it’s not easy)

26. © 2016 eMarketer Inc.
To measure in-store sales, mobile coupons are
still the most effective method
But location data is
proving powerful for O2O
measurement
 Attribution vendors use
location signals in
attribution models to
credit mobile ads with
in-store sales
 In-store beacons hold
promise

27. © 2016 eMarketer Inc.
Location
signals can
also be used
for measuring
gains in foot
traffic

28. © 2016 eMarketer Inc.
Clickthrough
rate and
conversion
rate remain
the primary
measurement
metrics
Defining “conversion” can
be challenging, since
mobile ads influence
actions in other channels

29. © 2016 eMarketer Inc.
Relying on additional performance metrics is a
best practice with mobile
 Clickthrough rate (CTR)
 Engagement rate
 Engagement time
 Viewability
 Etc.
Multiple performance metrics are even more important in mobile than
desktop because mobile’s “on-the-go” usage leads to accidental clicks

30. © 2016 eMarketer Inc.
When it comes to mobile viewability and
verification, advertisers have concerns
 The Media Ratings
Council issued an
update on mobile
viewable
impression
measurement in
November 2015
 Goal: Circulate
document for
industry feedback
in Q1 2016

31. © 2016 eMarketer Inc.
As mobile ad
measurement
methods
improve,
marketers’
opinion of
mobile’s
return on
investment is
changing—for
the better

32. © 2016 eMarketer Inc.
Creative is in crisis
(Thus the emergence of mobile ad blocking)
5

33. © 2016 eMarketer Inc.
Attitudes
toward mobile
advertising
aren’t very
positive
among US
adults
Hispanic and non-Hispanic
millennials were slightly
more open-minded about
mobile advertising

34. © 2016 eMarketer Inc.
Nearly 70%
of US mobile
internet users
encounter ads
in that realm
More than half
(51.8%) said
the ads were
not effective
69.1%
51.8%

35. © 2016 eMarketer Inc.
One out of
three US
mobile users
employ some
form of ad
blocking

36. © 2016 eMarketer Inc.
Ads are often intrusive and irrelevant
Read
this ad!
X
Look
here,
not
there! Tap here!
Response:
Advertisers are turning to dynamically created ads and native ad formats to
increase the relevancy of brand messages and better integrate ads with content
X
X

37. © 2016 eMarketer Inc.
More than
one third US
of advertisers
are using
dynamic
creative ads;
nearly 30%
more plan to
use such ads
in the near
future

38. © 2016 eMarketer Inc.
One in four
US marketers
plan to
increase
spending on
native
advertising,
and much of it
will be served
to mobile
devices

39. © 2016 eMarketer Inc.
Resolving the creative crisis cannot be
accomplished via advertisers’ creativity alone
Publishers need to
get creative with
new ad units
Branded emojis
in messaging apps
Image source: Swyft Media
Snapchat’s sponsored
lenses
Image source: AdWeek

40. © 2016 eMarketer Inc.
Recap: Five things you need to know now
 Digital advertising = mobile advertising
 Embrace mobile identifiers—cut the cookie cord.
 Digital advertising has reached the location tipping point.
 Mobile is measurable. But you need to know what you’re
measuring.
 Creative is in crisis, thus the emergence of mobile ad
blocking.

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Dstillery demystifies your consumers' digital footprints
to reach new audiences across
mobile and desktop, at moments that matter.

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Qualitative Behavioral and Geo-Location Data
BROWSER
BEHAVIORS
PLACES OF
INTEREST
DEVICE
LOCATIONS
APP
BEHAVIORS
Digesting 50 Billion Data Points Daily

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4:53P
OFFICE
LAPTOP
6:18P
HOME
TABLET
7:05P
STORE
CELL
Connecting Behavior: Hands and Feet

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LIFESTYLE
Married
College Graduate
INTERESTS
Sports
Gourmet Food
Movies
DEVICE / PEAK DATA USAGE
Mobile Phone: Wed, 8pm
PASSIONS
Luxury Cars
Music
Cooking
LAST SITE VISITS
Motor Trend
Food Network
Fandango
LOCATIONS VISITED
Whole Foods
AMC Theater
Porsche Dealership
Insights And Delivery Across
Devices, Formats and Channels
Mobile/ Tablet Display Desktop Display In App Video

46. © 2016 eMarketer Inc.
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Cathy Boyle
Mobile Advertising: Five Things
You Need to Know Now
 The Mobile Attribution Gap: Five Missing Links in Mobile
That Make Attribution Harder
 US Ad Spending: eMarketer's Updated Estimates for 2015
 Mobile Programmatic Advertising: Grabbing the Vast
Majority of US Display Ad Dollars by 2017
 Mobile Messaging Apps: Global User Forecast,
Leaderboard and Outlook on Monetization