Mobile

Facebook has totally changed the mobile ad industry, caused 180% spend spike in 2012

Image Credit: Shutterstock

The mobile advertising industry has seen a huge boom in 2012 — and it’s almost entirely thanks to Facebook.

As the year draws to a close, data from ad analysis firm eMarketer show that by branching into mobile ads, the social network helped U.S. mobile ad spend jump from $1.45 billion to $4.06 billion in just 12 months — a 180 percent increase year-over-year.

eMarketer notes that Twitter’s Promoted suite of ad products were also part of the growth, as were Google’s mobile ads. But the analysts place much greater significance on Facebook’s role in mobile ads.

“Facebook’s Q3 mobile performance is one major reason for the change,” the firms said in a statement on the figures.

“The social networking giant offered no mobile ad opportunities at the beginning of 2012 but grew its mobile business at an astonishing — and unexpected — rate. Before Facebook’s Q3 earnings call, most researchers and analysts expected U.S. mobile ad revenues of roughly $45 to $100 million, according to figures examined by eMarketer. While the company’s total ad revenues were, for the most part, unsurprising, the share of revenues attributed to mobile advertising was far from it.”

Facebook grew its mobile ad revenue from a flat zero in 2011 to nearly $340 million in 2012. The network is projected to pull in around $850 million for mobile ads in 2013.

For contrast, eMarketer pegs Google’s mobile ad sales at $750 million for 2011 and $2.17 billion for 2012, making up the lion’s share of all mobile ad sales at 56.6 percent of U.S. sales. Mobile search accounted for most of Google’s success in this area.

Twitter also posted zero mobile revenues in 2011 and, according to eMarketer, around $135 million on mobile in 2012. Pandora, Apple, and Millennial Media round out the other top mobile ad sellers.

Nevertheless, mobile ad sales remain a very small percentage of digital ad sales, let alone overall ad spend. Mobile accounts for only 2.4 percent of all ad budgets for U.S. brands, eMarketer says. The company expects mobile to overtake radio ad spend in 2016, by which time eMarketer estimates mobile will make up 11 percent of all ad sales.

Here are some charts from eMarketer on this data:

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Top image: nokhoog_buchachon/Shutterstock


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