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Mobile Advertising - US - May 2013

“The amount of real estate available for mobile ads, including apps, websites, games, mobile search, mobile social networking, and streaming audio and video, is enormous. With $3.4 billion in spending in 2012, marketers are staking positions in these new ad formats, but the most basic question regarding ad placement is still under discussion: does mobile advance sales, brand equity, both, or neither?”

– Billy Hulkower, Senior Technology Analyst

Some questions answered in this report include:

  • Is the phone too personal for ads?
  • Is the phone too small or slow for advertising?
  • Are mobile ads effective?
  • Apps: Best deployed above the line or below?
 

More than half of all U.S. teens and adults own a smartphone; time spent reading newspapers and magazines runs higher on mobile devices than it does for print; the majority of Facebook users access it primarily via mobile; 10% of all engagement with media occurs on a mobile device. Considering this, it may not be surprising that ad spend on mobile more than doubled in 2011 to $1.6 billion, and more than doubled again in 2012 to reach $3.4 billion.

Simultaneously, the mobile sphere is relatively novel for most advertisers, and many see the phone as too personal to be appropriate for ads, and its screen too small to allow for effective ads to be placed on it. This report serves as a guide for navigating mobile phone advertising, focusing on how brands can achieve the greatest return on investment for their mobile ad budgets. Subjects in the report include which demographics are most open to mobile ads, which show the highest level of response to ads, the type of ads preferred by consumers, as well as how to best take advantage of the location-based nature of mobile ads.

Other subjects covered in the report include mobile couponing, how consumers conduct product research via mobile phones, and an overview of which web activities are conducted via mobile in general, resulting in a clear view of where contact and engagement can occur on the mobile phone.

This report explores advertising and marketing on cell phones including:

  • Text
  • Email
  • Banner
  • Video
  • Coupons
  • Apps
  • Ads in games
  • Search
  • Social network
  • Internet radio
  • Mobile game ads
  • Tweets and feeds
 

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Table of contents

  1. Scope and Themes

    • What you need to know
      • Definition
        • Data sources
          • Sales data
            • Consumer data
              • Abbreviations and terms
                • Abbreviations
                  • Terms
                  • Executive Summary

                      • The market
                        • Sales doubling annually
                          • Figure 1: U.S. mobile ad sales, 2010-12
                        • Mobile share of internet ad sales quadruples 2010-12
                          • Figure 2: U.S. mobile ad share of total internet ad sales, 2010-12
                        • Market factors
                          • Trends in hardware penetration favorable for market growth
                            • Web activities on mobile phones gaining traction
                              • Figure 3: Top web-based features used on cell phone in past 30 days, April 2011-November 2012
                            • Data limitations a hindrance to video, a perk for apps
                              • Figure 4: Monthly cellular data allotment, by age, September 2012
                            • The consumer
                              • Social transitions to mobile
                                • Leisure activities more appropriate to mobile ads than packaged goods
                                  • High-income groups disproportionately available on iOS, BlackBerry
                                    • Figure 5: Smartphone OS, by household income, April 2013
                                  • Coupons, content, apps, drive interest
                                    • Search, web surfing rank highest in mobile web usage
                                      • Figure 6: Top online activities conducted in last month on a cell phone, January 2013
                                    • Ads reach three in four mobile web users
                                      • Figure 7: Types of mobile ads seen in past month, by age, January 2013
                                    • Search clear leader for conducting research via phone
                                      • Figure 8: Methods of product research conducted on mobile phones, January 2013
                                    • Blacks and Hispanics better audience for mobile ads than whites and Asians
                                      • Figure 9: Interest in purchasing products seen in mobile ads, by race and Hispanic origin, January 2012-August 2012
                                    • What we think
                                    • Issues in the Market

                                        • Is the phone too personal for ads?
                                          • Figure 10: Perception of mobile ads compared to PC ads, by age, January 2013
                                        • Is the phone too small or slow for advertising?
                                          • Figure 11: Attitudes to mobile ads, by age, January 2013
                                        • Are mobile ads effective?
                                          • Apps: Best deployed above the line or below?
                                          • Insights and Opportunities

                                            • Key points
                                              • Leisure activities beat products
                                                • Figure 12: Trends in attitudes to mobile advertising and shopping, January 2010-August 2012
                                              • Coupons beat activities
                                                • Figure 13: Interest in local mobile couponing, by age, January 2013
                                                • Figure 14: Use of mobile coupons, by household income, January 2012-August 2012
                                                • Figure 15: Use of mobile coupons, by age, January 2012-August 2012
                                              • Focusing on youth
                                                  • Figure 16: Attitudes to mobile ads and shopping, by age, January 2012-August 2012
                                                • Mobile video reaches young adults (only)
                                                  • Figure 17: Features used on cell phone in past 30 days, by age, April 2012-November 2012
                                                • Accessing an affluent audience
                                                  • Figure 18: Features used on cell phone in past 30 days, by household income, April 2012-November 2012
                                                  • Figure 19: Attitudes to mobile ads and mobile shopping, by household income, January 2012-August 2012
                                                • Targeting high-income households via the iOS
                                                  • Figure 20: Smartphone OS, by household income, April 2013
                                                • Buying the discount
                                                • Trend Application

                                                    • Inspire Trend: Attention Economy
                                                      • Figure 21: Attitudes to mobile ads, by gender, January 2013
                                                      • Figure 22: Stipulations for receiving mobile ads, by age, January 2013
                                                    • Inspire Trend: Make It Mine
                                                        • Figure 23: Purchasing and clicking in response to mobile ads, by gender, January 2013
                                                      • Mintel Futures: Human
                                                      • Market Size

                                                        • Key points
                                                          • Sales doubling annually
                                                              • Figure 24: U.S. mobile ad sales, 2010-12
                                                          • Competitive Context

                                                            • Key points
                                                              • Mobile ads to overtake PC ads this decade
                                                                • Figure 25: U.S. mobile ad share of total internet ad sales, 2010-12
                                                            • Market Drivers

                                                              • Key points
                                                                • Universal cell phone penetration
                                                                  • Figure 26: Cell phone ownership, April 2010-November 2012
                                                                • Majority of teens and adults own a smartphone
                                                                  • The rise of Phablets
                                                                    • Rollout of 4G
                                                                      • Figure 27: Attitudes to cellular internet speed, by current provider, September 2012
                                                                      • Figure 28: Attitudes to mobile ads in relation to internet speed, by age, January 2013
                                                                    • Data allotments largely limited on mobile web
                                                                      • Figure 29: Monthly cellular data allotment, by age, September 2012
                                                                    • Wi-Fi networks offer free access to mobile web
                                                                      • Figure 30: Devices used to access the internet at home, February 2010-August 2012
                                                                  • Innovations and Innovators

                                                                    • CSR and IndoorAtlas pursue precise hyper location
                                                                      • Digital watermarks combine print with mobile
                                                                        • Figure 31: Brides magazine We Love It 2.0 app, 2013
                                                                        • Figure 32: Digimarc Discover app
                                                                      • Apps allows user to opt out of behavioral targeting
                                                                        • Figure 33: Ad Control app for iOS image, April 2013
                                                                      • Secret “Mean Stinks” campaign links to cause-related social content
                                                                        • Location-linked texting opens new doors
                                                                          • Figure 34: Preferences for types of mobile ads, by age, January 2013
                                                                        • Google flu data used for location-based targeting in real time
                                                                          • Mobile search goes vocal
                                                                            • Verve Marketplace gives national access to local and local to national
                                                                            • Reach and Research

                                                                              • Key points
                                                                                • Three in four mobile web users exposed to ads
                                                                                  • Figure 35: Types of mobile ads seen in the past month, by age, January 2013
                                                                                • Spending on social networks, professional review sites questionable
                                                                                  • Figure 36: Methods of product research conducted on mobile phones, by age, January 2013
                                                                                • Larger screens preferred for product research and shopping
                                                                                  • Figure 37: Preferences between phones and larger devices for research and shopping, by age, January 2013
                                                                                • Higher-income groups stuck on the PC
                                                                                  • Figure 38: Preferences between phones and larger devices for research and shopping, by household income, January 2013
                                                                              • Mobile Web Activities

                                                                                • Key points
                                                                                  • Wide range of activities creates plethora of contact points
                                                                                    • Figure 39: Features used on cell phone in past 30 days, April 2010-November 2012
                                                                                    • Figure 40: Preferences for types of mobile ads, by age, January 2013
                                                                                    • Figure 41: Stipulations for receiving mobile ads, by age, January 2013
                                                                                  • Social mobile
                                                                                    • Apps
                                                                                      • Mobile shopping
                                                                                        • Figure 42: Online activities conducted in last month on a cell phone, by age, January 2013
                                                                                      • Mid- and high-income groups more active in mobile web
                                                                                        • Figure 43: Online activities conducted in last month on a cell phone, by household income, January 2013
                                                                                    • Dads and Moms

                                                                                      • Key points
                                                                                        • Men more friendly to ads, women more keen on coupons
                                                                                          • Figure 44: Willingness to receive mobile ads, by gender, January 2013
                                                                                          • Figure 45: Attitudes to mobile ads and mobile shopping, by gender and age, January 2012-August 2012
                                                                                        • Orienting ads towards dads and moms discretely
                                                                                          • Figure 46: Willingness to receive mobile ads, by parental status, January 2013
                                                                                          • Figure 47: Purchasing and clicking in response to ads, by parental status, January 2013
                                                                                          • Figure 48: Online activities conducted in the last month on a cell phone, by parental status, January 2013
                                                                                      • Impact of Race and Hispanic Origin

                                                                                        • Key points
                                                                                          • Asians lead in mobile activity, but not ad friendly
                                                                                            • Figure 49: Features used on cell phone in past 30 days, by race/Hispanic origin, April 2012-November 2012
                                                                                          • Hispanics, Blacks more open to mobile ads
                                                                                            • Figure 50: Attitudes to mobile ads and shopping, by race and Hispanic origin, January 2012-August 2012
                                                                                            • Figure 51: Use of mobile coupons by Hispanics, by language spoken in home, January 2012-August 2012
                                                                                        • Custom Consumer Groups: Based on Ad Engagement

                                                                                            • Key points
                                                                                              • Definition and demographics
                                                                                                • Definition
                                                                                                    • Figure 52: Stipulations for receiving mobile ads, by mobile ad groups, January 2013
                                                                                                  • Demographics
                                                                                                      • Figure 53: Mobile ad groups, by age, January 2013
                                                                                                      • Figure 54: Mobile ad groups, by parental status, January 2013
                                                                                                    • Online activities
                                                                                                        • Figure 55: Online activities conducted in last month on a cell phone, by mobile ad groups, January 2013
                                                                                                        • Figure 56: Methods of product research conducted on mobile phones, by mobile ad groups, January 2013
                                                                                                      • Attitudes to ads
                                                                                                          • Figure 57: Attitudes to mobile ads, by mobile ad groups, January 2013
                                                                                                      • Appendix – Additional Consumer Data

                                                                                                        • By gender
                                                                                                          • Figure 58: Methods of product research conducted on mobile phones, by gender, January 2013
                                                                                                          • Figure 59: Attitudes to mobile ads, by gender, January 2013
                                                                                                        • By age
                                                                                                          • Figure 60: Devices used to access the internet at home, by age, January 2012-August 2012
                                                                                                          • Figure 61: Purchasing and clicking in response to ads, by age, January 2013
                                                                                                        • By gender and age
                                                                                                          • Figure 62: Online activities conducted in last month on a cell phone, by gender and age, January 2013
                                                                                                          • Figure 63: Purchasing and clicking in response to ads, by gender and age, January 2013
                                                                                                          • Figure 64: Use of mobile coupons, by gender and age, January 2012-August 2012
                                                                                                        • By household income
                                                                                                          • Figure 65: Types of mobile ads seen in past month, by household income, January 2013
                                                                                                          • Figure 66: Devices used to access the internet at home, by household income, January 2012-August 2012
                                                                                                        • By marital and parental status
                                                                                                          • Figure 67: Features used on cell phone in past 30 days, by marital status and presence of children, April 2012-November 2012
                                                                                                          • Figure 68: Stipulations for receiving mobile ads, by marital status, January 2013
                                                                                                          • Figure 69: Stipulations for receiving mobile ads, by parental status, January 2013
                                                                                                          • Figure 70: Attitudes to mobile ads, by parental status, January 2013
                                                                                                          • Figure 71: Preferences for types of mobile ads, by parental status, January 2013
                                                                                                          • Figure 72: Methods of product research conducted on mobile phones, by parental status, January 2013
                                                                                                          • Figure 73: Attitudes to mobile ads and shopping, by marital status and presence of children, January 2012-August 2012
                                                                                                          • Figure 74: Preferences between phone and larger devices for research and shopping, by parental status, January 2013
                                                                                                          • Figure 75: Devices used to access the internet, by parents with children in household, January 2012-August 2012
                                                                                                          • Figure 76: Devices used to access the internet, by marital status and presence of children, January 2012-August 2012
                                                                                                          • Figure 77: Types of mobile ads seen in past month, by parental status, January 2013
                                                                                                        • By race and Hispanic origin
                                                                                                          • Figure 78: Methods of product research conducted on mobile phones, by race/Hispanic origin, January 2013
                                                                                                          • Figure 79: Online activities conducted in last month on cell phone, by race/Hispanic origin, January 2013
                                                                                                          • Figure 80: Stipulations for receiving mobile ads, by race/Hispanic origin, January 2013
                                                                                                          • Figure 81: Preferences between using a phone and larger devices for research and shopping, by race/Hispanic origin, January 2013
                                                                                                        • By language spoken in the home
                                                                                                          • Figure 82: Features used on cell phone in past 30 days, by language spoken in home, April 2012-November 2012
                                                                                                          • Figure 83: Attitudes to mobile ads and shopping, by language spoken in home, January 2012-August 2012
                                                                                                          • Figure 84: Devices used to access the internet, by languages spoken in home, January 2012-August 2012
                                                                                                        • Methods of research conducted on mobile phones: cross-tabulated
                                                                                                          • Figure 85: Methods of product research conducted on mobile phones, by methods of research, January 2013 (part 1)
                                                                                                          • Figure 86: Methods of product research conducted on mobile phones, by methods of research, January 2013 (part 2)
                                                                                                        • By mobile ad groups
                                                                                                          • Figure 87: Purchasing and clicking in response to ads, by mobile ad groups, January 2013
                                                                                                          • Figure 88: Preferences between using a phone and larger devices for research and shopping, by mobile ad groups, January 2013
                                                                                                          • Figure 89: Types of mobile ads seen in past month, by mobile ad groups, January 2013
                                                                                                          • Figure 90: Preferences for types of mobile ads, by mobile ad groups, January 2013
                                                                                                      • Appendix – Trade Associations

                                                                                                        Companies Covered

                                                                                                        • Apple, Inc
                                                                                                        • Centers for Disease Control and Prevention
                                                                                                        • Digital Media Association (DiMA)
                                                                                                        • Facebook, Inc.
                                                                                                        • Google, Inc.
                                                                                                        • Interactive Advertising Bureau (US)
                                                                                                        • Nokia Corporation (US)
                                                                                                        • Procter & Gamble USA
                                                                                                        • Twitter, Inc.
                                                                                                        • Yahoo! Inc
                                                                                                        • YouTube, Inc.

                                                                                                        Mobile Advertising - US - May 2013

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