subject: Local Search To Reach $1.3 Billion By 2011 [print this page] Local Search To Reach $1.3 Billion By 2011
Spurred by the burgeoning mobile Web and targeted advertising demand, U.S. local mobile search advertising will hit $1.3 billion by 2013--up from just $20 million in 2008, according to a new study by The Kelsey Group. The 130% annual growth rate the market search company forecasts for local search spending easily surpasses the 81% annual improve it expects for overall mobile advertising (search and display), that will surge to $3.1 billion in 2013 from $160 billion in 2008.
Local mobile search income is really the fastest-growing curve we have,
said Michael Boland, program director for Kelsey's newly formed unit focusing on mobile local media. That's a combination of more search exercise that is local, but also the fact that CPC rates, and other ways mobiles ads are sold, will be greater than overall search because of that local targeting which commands a premium.
At present, an estimated 54.4 million--or about 20% of U.S. cell subscribers--are on a mobile Web, and only 5.2 million are making searches of any kind. As the most common mobile information service today, SMS text messaging still claims the lion's share of mobile advertising--$100 million of the $160 million last year, compared to $39 million for search. But in 5 years, Kelsey expects that proportion to be flipped, with search claiming two-thirds of the $3.1 billion in mobile ad spending. In that period, local search volume is projected to grow from 28% to 35% of all mobile searches, while local search income will improve from 50% to 56%. We think local will be a large beneficiary because of the inherent qualities of mobile devices,
said Boland.
Things like form-factor, location-awareness, and being around the thing of sale. Claim Your Google Places Listing. Those attributes will cause more advertising efforts and mobile applications tied to local shopping and commerce. Already, companies such as Kadrillion, GPShopper and NearbyNow provide local product search through cell phone. And of the 15,000 iPhone applications available through Apple's App Store, about 15% are geared toward local search, according to The Kelsey Group. To date, however, small companies have not embraced mobile advertising because of technical and company hurdles that make ad buys hard even for large advertisers. But Boland says that's beginning to alter as Web giants for example Google, Yahoo and Microsoft launch new mobile ad choices as they compete to conquer the mobile Internet. Google, for instance, recently lengthy its AdWords method to the iPhone and Android- powered phones, allowing advertisers to run campaigns on individuals platforms without having even requiring a mobile landing page.
Mobile search will be a great opportunity for little businesses as Google and others put the tools in their hands to consume advantage of it,
said Boland. But how does Kelsey square its aggressive growth projections with a recession that's already cutting into ad budgets and mobile phone sales? Boland acknowledged that the downturn will slow mobile ad growth through 2010. Mobile, to your lot of advertisers, is still seen as experimental,
he said. Starting from the little baseline of $20 million in 2008, the organization expects local mobile ad spending will improve fourfold to $81 million this year, and triple to $242 million in 2010. But coming out from the recession, mobile Web use and search volume will reach a level where it starts to attract a lot of advertising,
said Boland.
The combination of those points really begin to tip scale by the 2011 time-frame.
That's when the category is expected to top $500 million. From www.mediapost.com
