Google Takes Majority Of Mobile Ads, Facebook Closest Rival
Google will end 2013 with 56% -- about $8.85 billion -- of the worldwide investments in mobile advertising, if eMarketer is right.
The research firm estimates Google earned $4.61 billion in mobile Internet ad revenue last year, more than triple its earnings in 2011. It also netted $32.73 billion in digital ad revenue in 2012, nearly 31.5% of total worldwide digital ad budgets spent during that year.
Aside from the growing adoption and monetization of mobile through AdWords Enhanced Campaigns, the ability to generate continuous revenue through YouTube will help Google keep its lead. The fact that smartphones continue to build on operating systems, push technology and search engine queries that learn from actions and accessible data to the phone will also support growth.
"Mobile search presents a challenge for advertisers, and Google, as consumers are still less likely to purchase goods on their phones vs. the desktop," said Clark Fredricksen, eMarketer vice president. "For now, that means mobile is still a less attractive ad channel for some direct-response advertisers than desktop."
Fredricksen pointed to February worldwide search metrics by device from Marin Software. Smartphones came in at 4.7% click-through rates (CTR) on $0.48 cost per click (CPC) and a 2.8% conversion rate. Tablets were 3.1%, on $0.62 and 3.3%, respectively.
Retail, financial services, automotive, telecom, consumer product goods and travel spend the most online each year. Overall, Fredricksen said direct-response sectors, like retail at an estimated $9.4 billion in 2013, tend to spend the most on Google, while brand dollars spread across other platforms.
Facebook will become the No. 2 beneficiary of investments in mobile ads. The company will garner about $2.04 billion this year, accounting for 12.9% market share. Other companies like Pandora, YP, Twitter, and Millennial Media will gain some share.
eMarketer estimates marketers will spend more on Twitter this year, increasing its share to about 2%. In the U.S., Twitter will take about 3.6% share; worldwide, 1.95%.