Mobile Marketers Diverting Desktop Ad Dollars

Thanks to mobile mania, the days of growth are virtually over for desktop ad formats like search and banners, new research suggests. Desktop ad spending will peak in 2014 at $35.39 billion -- up from this year's projected total of $34.29 billion -- and then begin its steady decline, eMarketer predicts in a new report.

By 2015, desktop spending will drop slightly to $35.26 billion, and decrease further in 2016 and 2017, when it's expected to total $32.51 billion -- just above the amount spent in 2012.

The culprit? Mobile-crazed marketers are increasingly diverting desktop dollars to new platforms like smartphones and tablets, said Clark Fredricksen, a researcher at eMarketer.

“The growth of mobile advertising is slowing spending directed toward desktop ad formats faster than expected,” according to Fredricksen.

EMarketer estimates U.S. digital ad spending will reach $41.9 billion this year -- up 14% over 2012.

Of that amount, $7.7 billion -- and the bulk of incremental growth in digital advertising overall -- will go toward mobile ads, the firm expects. 

In particular, mobile search advertising is expected to grow 76% this year, and a further 52% next year, while mobile banner advertising is expected to grow 100% this year, and 54% in 2014.

“That equates to a $2 billion increase in mobile search spending next year over 2013 and nearly a $1 billion increase in mobile banner spending.” Mobile video ad spending, meanwhile, will continue to grow at triple-digit rates this year, with banners, rich media and other display ads predicted to rise 78.3% compared to search's 76.4%, eMarketer estimates.

As a result, nearly all desktop ads formats, with the exception of digital video and sponsorships, are expected to see declining spending or flat growth.

“Most emblematic of the shift to mobile is that desktop banner and search advertising, two stalwart formats in the digital advertising world, are both expected to see flat or declining growth in 2014, for the first time ever.”

Marketers are wise to be shifting their focus to mobile, according to eMarketer, as more than half of U.S. mobile users now own smartphones, and time spent with mobile devices continues to grow year-over-year. So far, the greatest beneficiaries of the mobile boom include social platforms like Facebook and Twitter.

Indeed, after less than a full year selling mobile ads, 18% of U.S. net Facebook ad revenues came from mobile in 2012, eMarketer estimates. This year, that share will reach 40%, and by 2015 it will near the halfway mark, the firm predicts. As of 2012 meanwhile, 52% of Twitter's net US ad revenues were from mobile, which eMarketer expects to approach two-thirds by 2015

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