Mobile Internet is very hot, but why can't the advertisement sell a good price?

Mobile Internet may represent the future, but for now, mobile advertising is still cheaper than print and internet advertising.

Earlier this year, a well-known venture capitalist, Meeker Mary Meeker, a "queen of the Internet", said in an annual Internet trend report that the effective CPM for desktop Internet advertising was $3.50 trillion, while the effective CPM for mobile advertising was only $0.75.

Recently, mobile advertising platform Opera Software released data, announced the average cost of mobile advertising on different devices. According to the data, the iphone platform has the highest average CPM in mobile ads on all smartphones, but still only 2.85 dollars, significantly below the average level of desktop internet advertising. More importantly, Opera's estimates may be overly optimistic because the company focuses on mobile display ads rather than mobile search ads. The latter usually has a lower CPM.

CPM for mobile advertising of different devices (thousands of display costs)

In contrast, the maximum number of CPM in print advertising is 100 dollars, and in some special cases, CPM in mobile advertising is higher than print and desktop internet advertising. Apple, for example, launched the IAD mobile ad service in 2010, initially with a CPM of 10 to 15 dollars (depending on how the ad dot pass rate is calculated).

Overall, however, the price of mobile advertising is still relatively low, mainly because of the small size of the mobile screen, search advertising itself, low prices, and lack of innovative advertising technology, prompting advertisers to spend more budget.

Mobile search Ads trapped

According to emarketer's latest data, marketers are now spending more on mobile-search ads than mobile-display ads. However, for many reasons, the search ads for CPM far less than display ads.

Trends and distributions of mobile advertising in the United States, emarketer data

Mobile display ads mainly include banner ads, video ads, and other rich media ads. It is generally believed that such ads are more interactive and therefore more valuable to advertisers. and search ads are mostly found next to Google's search results. In fact, Google is currently in the mobile search advertising market share of up to 95%. Some analysts believe that such search advertising is ineffective and does not give a good boost to the user's decision to make a purchase.

"Advertisers know that consumers are less willing to shop through mobile phones, especially bulk shopping, so the ' direct response ' ads that drive the development of the EMarketer on the desktop platform cannot be ported to mobile platforms," said Clark Fredrickson, vice president. "He believes that Google is very aware of the low conversion rate of mobile advertising, so only to keep the advertising price low level."

Google did not comment on the price trend of mobile search advertising. But Google's third-quarter results showed that lower search advertising prices weighed down the overall level of price per click. Google reported that in the third quarter, the number of paid clicks rose by 33% Year-on-year, while the cost per click fell by 15%. Even so, Google still believes that mobile advertising has been successful because marketers have been given the right experience.

"Despite the early stages of development, the mobile platform has shown strong momentum," said Jason Spero, head of global mobile sales and strategy at Google. It is clear that mobile advertising can bring value to advertisers as long as the right moves are taken. We see that immersion branding and direct response campaigns have taken into account relevance, telephony, and device capabilities. Once marketers get the right experience and can effectively measure the effect of advertising, mobile advertising will become a market change. ”

The reality, however, is that providing the right experience is easy to say and difficult to do. The problem is not just low conversion rates, but many marketers are also concerned that screens with smaller mobile devices will make display ads or search ads more abrupt and less appealing to consumers. As a result, publishers and advertisers cannot just shrink the size of ads on the desktop Internet, they need to rethink their strategy.

Marketers ' hesitation

U.S. mobile advertising spending nearly doubled in the first half of the year to $1.24 billion trillion, according to the latest data from the US interactive advertising agency. However, mobile advertising still accounts for only 7% of total internet advertising spending.

"Everyone is excited about the mobile internet, but only a very small portion of the advertising budget is being directed to mobile platforms," says Fredrickson. People spend a lot of time on mobile devices, but they spend very little money, and the gap will become more pronounced. ”

The distribution trend of advertising expenditure can be seen that the mobile ad is negligible

For marketers, the main reason for hesitation is that mobile advertising technology is still in the neonatal phase. Many of the tools on the desktop Internet are not currently suitable for mobile platforms.

Mahi De Silva, executive vice president of Opera, said: "The desktop Internet market took 15 years to develop into the current state." With cookies and a re-targeting engine, the desktop Internet makes it more fun to display ads. But such technology does not apply to mobile platforms. ”

In fact, some of these technologies may never enter the mobile platform. For example, cookies are the most critical tool for advertisers to target users based on their internet history, but the current mobile browsers do not support cookies. This forces advertisers to rely on other information, such as the unique identification code for mobile devices. This provides advertisers with much less information than cookies.

In addition, when placing mobile ads, marketers need to make additional investments, such as making mobile landing pages and recording new systems for user ad clicks. Advertisers are now skeptical about the effectiveness of mobile advertising and the quality of advertising targeting technology, so mobile advertising has been slow to develop.

The prospect of mobile advertising

While the average price of mobile advertising is lower today, analysts expect the price to rise over the next few years as advertising technology improves and consumers move more and more on mobile platforms.

Fredrickson and De Silva agree that publishers will gradually introduce more sophisticated advertising tools, including better advertising targeting technology and account management systems. This will encourage marketers to buy more mobile ads and drive the rise in CPM. In fact, Facebook is testing a new system to help marketers put mobile ads on third-party apps and websites, and the ads are based on the "like" History of users on Facebook.

Although the functions of desktop Internet such as cookies are difficult to replicate to mobile platforms, other marketing tools still have opportunities, including advertising based on where users are located. With this technology, advertisers can push promotional information to consumers in a particular store.

At the same time, mobile search advertising prices will continue to rise, as consumers will become more and more accustomed to mobile phones and tablets for bulk shopping. "With the development of mobile e-business, you will see advertisers getting more and more interested," says Fredrickson. ”

De Silva believes that the popularity of tablets will drive the average CPM rise in mobile advertising. According to Opera's findings, the ipad platform ad has a CPM of 3.96 dollars, more than one of the iphone platform ads. However, in the second quarter of this year, the ipad accounted for only 7% of all mobile traffic. As the ipad becomes more popular, it will also lead to an increase in the average price of mobile advertising.

This article compiles from a Mashable source: a Genesis note