Mary Meeker’s annual Internet Trends report came out on Wednesday this week, and one section of it has a simple statement that sums up the mobile space: The easy growth is behind us.
In developed countries, companies battle over existing users as market penetration nears 100%. In developing countries, poor Internet infrastructure, slowing growth and an uphill battle to
“connect the next billion” means that reaching new users is harder than ever.
On the other hand, advertising technology has seen tremendous growth driven primarily by mobile. With
a 20% growth rate, up from 16% year-over-year, there is still plenty of room for growth. Most likely that growth will happen for Facebook and Google, but a rising tide lifts all boats.
Meeker
points out that advertisers are still spending too much on legacy media, and still haven’t capitalized on the opportunity mobile affords.
Much of that problem lies at the feet of
advertisers, who’ve done such a bad job that 93% of mobile users consider getting ad blockers. Google has proved that effective advertising can exist, and that the problems advertisers face are
mostly of their own devising.
A vast amount of the ad blocker users of the world are in Asia, the same region that many will look to connect new Internet users.
Advertisers in the
future will have to be able to retain and attract new customers, as well as reach new first-time audience members beyond the pale of the already-established marketplaces if they want to remain
competitive.