Alphabet Inc. today reports that Google’s advertising revenue rose 19.5% in the second quarter.
Local businesses put more of their ad dollars into mobile.
Studies have shown that most searchers on mobile devices have local intent, meaning they are looking for something—a store, a restaurant, a product, a local sale or deal—near to where they are at the moment. With that in mind, the amount of money spent on mobile ads with a local focus will grow from $784 million last year to $5.01 billion in 2016, a 539% leap and an annual growth rate of 45%, predicts a new study from media research and consulting firm BIA/Kelsey.
The firm segments mobile local ads into four distinct formats: search, display, text messages and video. Search is growing the fastest and is the biggest driver of growth in mobile local advertising, the study says.
Mobile local paid search ad spending hit $390 million in 2011, BIA/Kelsey says. It will reach $691 million this year and $3.21 billion in 2016. Mobile local display ad spending hit $299 million in 2011, the firm says. It will reach $506 million this year and $1.32 billion in 2016.
Mobile local text ad spending hit $81 million in 2011, and is projected to reach $101 million this year and $182 million in 2016. Mobile local video ad spending hit $14 million in 2011; it will reach $29 million this year and $292 million in 2016, BIA/Kelsey predicts.
Marketers spent approximately $1.6 billion on mobile ads of all types last year, accounting for 5% of all online marketing, according to the Interactive Advertising Bureau, a trade group for online marketers.
With mobile paid search ads taking the biggest share of mobile local advertising, BIA/Kelsey says companies should closely watch the number of searches conducted on desktops versus mobile devices. Consumers will conduct more searches on mobile than on desktop computers by 2015, the firm predicts. By 2016, search will be decidedly mobile, with consumers conducting 113.4 billion mobile searches compared with 85.6 billion on desktop computers.