Of all the eye-opening stats that analyst and VC Mary Meeker dropped today with her annual Internet Trends report, one of the scariest for marketers and publishers was just how poorly mobile usage is being monetized.
In a world that is rapidly adopting smartphones, tablets, and everything in between, there is a serious disconnect between making money from users of those devices versus users of desktops and laptops. Frankly, it’s a little scary for those who make a living from the web.
First, the good news: People are rapidly adopting mobile devices and mobile Internet traffic is growing quickly. The total amount of Internet traffic coming from mobile now sits at about 10 percent versus 1 percent in late 2009. That means mobile devices are immensely popular and people are responding well to using phones to access web-based content.
And in India specifically, take a glance at just how quickly mobile adoption is overcoming desktop-based web growth.
But — and it’s a big but — the monetization on mobile web and mobile apps is absolutely terrible versus the desktop-focused web. It’s so much of a problem that it almost certainly will affect Facebook’s long-term growth prospects, which is one factor that weighed down its IPO. Also, take note that current comScore projections say the effective CPM per desktop user is $3.50 per person, but eCPM per mobile user is just $.75 per person.
Now, to be fair, mobile monetization has grown over time. Apps have especially have seen their compound annual growth rate (CAGR) rise.
While it’s encouraging to see the value of both mobile apps and the mobile web rise, it’s going to be a tough ride while marketers, publishers, and web-focused companies figure out how to keep those CPM rates going up.
At the All Things D conference today, where Meeker first presented these slides, she did note that some companies, especially Twitter, have done a good job at stepping up their game to monetize mobile.
“It’s early,” Meeker said. “The screen is small and the ad units haven’t been rolled out effectively yet. We’re still early in figuring out local and social, and I think we’re going to get there.”
Top photo credit: koya979/Shutterstock
Slides credit: Mary Meeker, Kleiner Perkins Caufield Byers
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