2014 marked the first year that mobile Internet usage surpassed desktop, which is no doubt why a recent Forrester Research study predicts sales from consumers shopping on mobile phones will increase to $38 billion this year. In fact, the average-order size on smart phones is expected to nearly match those on desktops and tablets this year, indicating a growing consumer comfort level in shopping via mobile devices.
Likewise, this growth in mobile spending by consumers is fueling advertiser spending, placing mobile among the top three advertising channels experiencing the most dramatic growth this year -- alongside social and digital video channels.
If you haven't yet dipped your toe into the mobile advertising water, here are the basic elements to understand before investing. While there are a variety of mobile advertising opportunities, the most common are display, native, and search ads.
Display ads are essentially banner ads that typically redirect a user to a landing page when clicked. They are generally purchased on a CPM (cost per 1000 impressions) or CPC (cost per click) basis.
The pros are that display ads offer a relatively low cost-per-click and a high reach (total people exposed to an ad). They also allow for visually appealing ads with graphics that support branding. The cons are that display ads often generate a low click-through rate (due to the limited control over who sees/clicks your ad), with the potential for many of those clicks to be accidental -- from users not truly interested in your brand which you would be paying for if in a CPC (cost-per-click) payment arrangement.
Native ads are similar to display ads in the way they are purchased, but they allow the ad to appear directly in user newsfeeds (think Facebook and Twitter) versus in a special advertising section of the site. Display ads are designed to interrupt the users' online activities, while native ads are designed to fit within those activities.
Native ads oftentimes generate higher levels of engagement provided the content is interesting and relevant to the user. Content that feels overly promotional or otherwise inappropriate for placement within a user's newsfeed will largely be ignored.
Search ads, like those you'd find at the top or right of a Google search, certainly offer highly qualified clicks and high click-through rates, as you're targeting consumers looking for precisely what you're offering, if you purchase the right keywords that is. The downside is that you'll often face stiff competition for desired keywords, which drives up the cost per click. And with just three lines of text available for brand messaging, you have limited promotional space.
Check back for next week's column on the current state of text advertising and what it can mean for your business.
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