Mobile ad spend to grow 59% by 2020 as smartphones and internet drive surge

A report by Dentsu Aegis Network-owned social and digital media agency WATConsult estimates mobile advertisement spending in India would growth at 59% CAGR

With a rapid adoption of smartphones and the availability of affordable internet services, the spending on mobile advertisements in India is expected to grow at a compound annual rate (CAGR) of 59 per cent and reach at Rs 13,325 crore by 2020, according to a report by the Dentsu Aegis Network-owned social and digital media agency WATConsult.

The report says mobile advertisements are perceived to be more useful but less engaging when compared with desktop ads. However, mobile advertisements are most viewed on smartphone screens, with 75 per cent of respondents preferring to watch these ads using smartphone, against 42 per cent who use laptops.

The report also says the rise in digital information consumption is fuelled by affordable data connectivity, which has played a crucial role in bringing consumers on to mobile devices. In India, the rollout of 4G internet services has triggered a rise in ad viewing on smartphones when compared with laptops and desktops. Overall, 66 per cent respondents who participated in the survey confirmed using 4G services, followed by 37 per cent respondents who used 3G services and 31 per cent who were on Wi-Fi.

The report highlights that people use mobile devices primarily to access social media networks and emails, followed by online banking, e-wallets services, watching videos and online shopping. On the other hand, the conventional mediums -- desktops and laptops -- are mostly used for work and educational purposes.

Therefore, the report adds, the social media ads are the most viewed, followed by video, e-mail and search-based ads.

In terms of products, the most clicked mobile ads translating into sale are those of electronic products, clothing, footwear, books, movies, games and music. Health & fitness, and food & beverage ads are also clicked, but they do not turn into sales. The worst performers are mobile ads featuring jewellery, pharmaceuticals and insurance products, which get few clicks.

The report states that consumers often find mobile ads invasive and exasperating. Therefore, the report suggests advertisers create informative, helpful and engaging ads to gain consumer attention, which would later turn into clicks and sales.

The report also suggests that advertisers make ads for mobile informative, helpful and engaging in order to attract consumer attention, leading to increased clicks. Cheerful and interesting ads lead to purchases.

Consumers also feel that mobile ads are often intrusive and annoying. They give rise to security concerns as well.

Key findings of the report:

• Mobile ads are perceived to be more useful but less engaging versus desktop ads, which are perceived to be more engaging
• Smartphones screens are the most viewed devices for mobile ads, with 75% of the respondents using smartphone, followed by 42% who use laptops
• 4G is the most used data connection followed by 3G and WiFi
• Mobile devices are maximum used for accessing social networks and e-mails, followed by usage of wallets, watching videos or shows and online shopping
• 48% of the respondents prefer social media ads, followed by video ads, e-mail ads and search ads when it comes to mobile ad formats
• Ad categories such as clothing & footwear, electronic products, books, movies/music/games are highly ‘clicked and purchased’; whereas, jewellery, pharmaceutical products and insurance products ads do not get clicked much
• Overall, the report deduces that majority of the respondents found mobile ads to be intrusive and irrelevant and they feared breach of privacy.