Mobile Apps Take Aim at Internet Ad Revenue Dominance (And They’ll Win)

May 2, 2014
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It has finally happened: Internet ad revenue has outperformed the industry’s traditional ad spend behemoth — broadcast TV. And it has done so only with the help of mobile. 

Of course, we’ve long seen this day coming.

It has finally happened: Internet ad revenue has outperformed the industry’s traditional ad spend behemoth — broadcast TV. And it has done so only with the help of mobile. 

Of course, we’ve long seen this day coming.

In 2010, Mary Meeker, the former Wall Street analyst who nearly perfectly predicted the future of ad spend, marked 2014 as the year that the mobile web would become more utilized than desktop web access. Three years later, her now annual State of the Internet report summarized that in 2012 (presented in 2013, looking back on the 2012 fiscal year), there was still a $20B ad revenue opportunity in Internet and mobile advertising. Mobile claimed stake to the majority of that opportunity. 

Then, almost in tandem with Meeker’s presentation, ad spend in mobile shot through the roof. According to a new study by the Interactive Advertising Bureau (IAB), mobile accounted for 17% of 2013 ad revenues, whereas in 2012, mobile only accounted for 9%. In all, mobile pulled in $7.1B in revenue in 2013, a 110% boost from 2012 in which it earned $3.4B. 

But it wasn’t Mary Meeker’s presentation that triggered the shift. Instead, it was the good folks behind the scenes at ad agencies finally deciding to put their faith in data’s analytical hands. In essence, the ads followed the numbers, and the numbers pointed to mobile.

And in 2014 — the data will only support further mobile ad spend. 

See, there was one thing Mary Meeker didn’t see coming in 2010. And that was this: mobile Internet usage wouldn’t eventually come to surpass desktop Internet usage, as she predicted. No — instead, mobile app usage would come to dominate the space in ways no one, not even Nostradamus or Steve Jobs themselves, could have predicted only a few years ago. 

In January of 2014, mobile app usage usurped desktop Internet usage, accounting for 46.6% of the average American’s total digital media diet. Desktop usage, for the first time in the history of the Internet, fell behind mobile at 45.1%. The remaining 8.3% is credited to mobile Internet usage — a number that continues to wane

Indeed, the mobile browser has simply become another app in the sea of available apps — and not a very fancy one at that. 

Data-Backed Proof — Because That’s What We Do

What’s more? This trend is only continuing — and it’s extremely likely that it isn’t even a trend at all. Instead, it’s our new digital world order. Don’t believe it? Let’s look at the numbers behind SXSW 2014 RSVPs. 

First, a bit of background: Umbel partnered up with SXSW to provide easy to launch, customizable RSVP apps to brands hosting parties in Austin, allowing those brands to gain audience intelligence data into exactly who was RSVPing. Umbel’s technology uses social login with assured user anonymity to allow brands to visually access their audience’s brand affinities, social media habits and on-site behaviors — all while maintaining individual user privacy. It also takes a tally on who is using what device. 

Here’s what we found:

Between the Paste Party, the Spin Party and the Brooklyn Vegan Party, 61% of those who RSVPed used desktop to do so, which means that at SXSW, yes — desktop won. 

But, that leaves 42% of RSVPs coming from mobile — and 42% is hardly a minority. In fact, more than 26,000 people used the mobile app to RSVP (yes, it is an app), the vast majority of which were on iOS when they did so. 

Let This Sink In…

More than 26,000 people used our mobile RSVP app to connect with Facebook’s mobile app in a quick, no more than 10 second, registration process that got them on the list for SXSW parties — most of which were announced or advertised only via desktop or mobile Internet. Combine that with the fact that 78% of Facebook’s daily users are mobile, and here is your take away: in 2015, mobile app usage will dominate, making desktop Internet the minority and mobile Internet a mere blip in the digital media sphere.

And ad dollars will follow, more than likely increasing by triple digit percentages — as they have done for the past three years. See, the math is simple: the users are there, the ROI is there. The only thing left to consider is how you’ll activate those new impressions, clicks and conversions. Lucky for you: Umbel’s tech has already figured that out