Mobile advertising grew to surpass desktop advertising for the first time in 2017 and will make up a staggering 75% of all digital ad spending by 2022. This year, the mobile advertising market is expected to exceed $200 billion globally.1 In the US alone, mobile ad spending is set to increase by more than 21% to over $120 billion, according to eMarketer. With 5G networks already gaining traction in certain countries and privacy regulations continuing to tighten, 2020 will be a pivotal year for the industry. In this blog post, we cover a few of the most important mobile advertising trends that will shape the landscape in the year ahead.
The Continued Growth of Mobile and In-App Ad Spending
Advertisers will continue to shift away from desktop to reach users on mobile devices, with apps representing the majority of this focus. US mobile in-app ad spending is expected to reach $73 billion in 2021.2 At the same time, mobile programmatic video advertising will continue to grow, with US marketers expected to spend more than $24 billion on mobile video.3 Ad agency Zenith believes mobile ad spending will account for over 30% of all global advertising expenditures this year — not just digital.4
In-App Header Bidding Is on the Rise
An increasing number of mobile programmatic transactions are shifting towards a setup that mimics the header bidding system of desktop advertising. With header bidding, publishers offer their inventory to multiple demand partners simultaneously, as a way of getting rid of the “waterfall” approach that has previously limited competition and prevented revenues from reaching their full potential. With in-app header bidding, transparency within the mobile advertising ecosystem is expected to increase, and demand partners will receive more equal bidding positions within real-time auctions.
During 2019, the industry saw a growing number of solutions designed to woo mobile and in-app publishers away from the traditional waterfalls. While there is currently no single in-app header bidding solution that entirely addresses all market needs, we expect to see this change in the year ahead.
A Growing Focus on Measurement
As the mobile advertising ecosystem has matured, viewability has become a critical metric for both advertisers and publishers. Last year, one specific viewability project made all of the headlines: the IAB Tech Lab’s Open Measurement SDK.
The Open Measurement SDK (OM SDK) facilitates third-party viewability and verification measurement for mobile apps without requiring multiple verification vendor SDKs. There are numerous benefits for all parties within the mobile in-app ecosystem, including:
- Publishers: Easier integration and fewer maintenance efforts
- Ad buyers: Viewability measurement is more accessible
- Viewability vendors: Equal data access to all vendors improves accuracy
Measurement, with viewability in focus, will continue to be of great importance in 2020. Since its announcement to the public, the sell-side has been rapidly adopting the OM SDK. But we’ll see brands, agencies, and demand-side platforms (DSPs) getting more active and taking advantage of what this standard offers in the year ahead.
Increased Privacy Awareness
With the implementation of the General Data Protection Regulation (GDPR) in early 2018, one of the most challenging eras in recent advertising history began. Since that time, many other data protection and privacy regulations have come into effect. The scale of available data has dropped in many parts of the world, causing concern among advertisers. However, many argue that the quality of data has since increased, leading to more effective targeting. In the year ahead, marketers will need to continue adjusting their strategies for how they acquire and use data. Here’s an in-depth overview of all the regulations already in place and the ones emerging throughout 2020.
Connected TV Goes Programmatic
The rise of connected TV (CTV) opportunities for advertisers in 2020 has been a hot topic of discussion. Historically, CTV ad buying has been a fragmented and relationship-based process for both advertisers and content providers. With even more momentum behind connected TV platforms, this is not a situation that we expect the market to bear for long. In 2020, industry players will move to develop setups that facilitate the widespread adoption of real-time bidding for CTV inventory.
2020 will be an exciting year for mobile and in-app advertising, and these trends provide a taste of the strides forward that we can expect the industry to take. Marketers looking to follow the tide of consumer behavior into the mobile ecosystem should observe these areas closely.
Sources: 1Statista, December 2019 | 2eMarketer, June 2017 | 3eMarketer, December 2019 | 4Zenith Media, June 2018