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Mobile spending decreased in fourth quarter as economy rebounded: survey

While the economy is starting to rebound, that has not translated to an increase in spending on mobile, according to an agency survey by Strata.

Strata, a media buying and selling software provider that is a subsidiary of Comcast, found that for the first time since the survey began in 2008, more than half of the respondents expressed an increase in business. The survey, which follows advertising trends from leading agencies nationwide, also discovered that digital advertising demand has actually decreased, with mobile advertising not yet living up to industry hype, Strata claims.

“Mobile advertising is definitely creating a buzz, but so far the dollars have not followed, according to agencies surveyed,” said John Shelton, president/CEO of Strata, Chicago. “Agencies do show interest, especially in the iPhone, iPad and other smartphones and mobile devices.

“But most – 90 percent  –  do not see mobile advertising cutting into their TV ad planning,” he said. “Apple TV, iAd and Google TV still have a long hill to climb to get into ad planning for agencies, and location-based advertising still needs to prove it is more than just a fad or a small niche resource for advertisers.

“Those who do advertise on mobile are still just focusing on display ads.”

Good news, bad news
The Strata survey found that while mobile advertising is definitely creating buzz, the advertising purchases have not followed.

Of all interactive advertising, mobile was a distant fourth in advertisers’ minds at 29 percent, behind online display (80 percent), social media (61 percent) and search (60 percent).

The iPhone remains the top mobile device for advertisers, with more than 80 percent expressing that they are most interested in placing ads on the Apple device.

BlackBerry outpaces Android, at 51 percent to Android’s 45.8 percent.

Apple’s iPad is slowly gaining momentum in the advertising realm, where 31 percent of advertisers say they are interested in placing ads on the new device – a 22 percent increase from the previous quarter.

Other key findings of the Strata survey include the opinion that location-based advertising avenues are not even a blip on the map for many agencies, with nearly 70 percent say location-based services are not in their 2011 plans.

Those few who are interested throw their support behind Facebook Places as the top choice, followed by Foursquare.

Platforms such as iAd, Google TV and Apple TV still hold little interest to agencies, as 90 percent say they do not have clients requesting these platforms.

Of types of mobile advertising, display is the top choice at 67 percent – up 28 percent from the third quarter 2010.

SMS is second at 15 percent, down a whopping 34 percent over the last quarter.

“Mobile advertising still has a lot of ground to cover in 2011, but with Verizon now selling the 4G iPhone and the Droid continuing to gain popularity, advertisers can potentially reach a larger demographic and receive a more profitable ROI this year,” Mr. Shelton said.

“Optimism about 2011 is high, as nearly 35 percent expect the economy and their business to return to a strong growth period by late 2011,” he said. “Seventeen percent actually feel they are already there – a great economic indicator for this year.”

Final Take
Dan Butcher, associate editor, Mobile Commerce Daily (recorded after the third-quarter 2010 survey)