A few weeks ago Mary Meeker, of Kleiner Perkins, presented a
deck on internet trends in 2012 at the D10 conference. Meeker is a renowned
venture capitalist who focuses on investments in high-growth internet
companies. The presentation outlines two trends that are highly relevant to
digital media. The first is that internet growth remains robust and the second
is that rapid mobile adoption still in early stages. An 8% year-over-year
increase in internet users implies that marketers should continue to increase
their investments in digital marketing in the coming years. Meeker’s deck also
outlines a 37% increase in growth in mobile subscribers, noting rapid growth of
mobile conference and payment systems. While mobile eCPMs are 5X lower than
desktop, Meeker projects that mobile monetization will is likely to surpass
desktop monetization within the next 3 years. For the past 5 years, I’ve heard industry experts consistently promise
that it’s the "year of mobile". Today, I think we’re still several years away
from this milestone for two primary reasons: 1. The first ad on the internet (via desktop)
appeared nearly 20 years ago. Today, marketers are only allocating ~15% of
marketing spend to desktop internet advertising. Two decades since its
inception and this advertising medium hasn’t even captured a quarter of the
market. 2 Mobile measurement & analytics are not robust. Marketers are not
comfortable interpreting such data and quantifying ROI. I also think that the
power of mobile is under-estimated and under-used by marketers. Mobile is the only medium that bridges
the gap between online marketing and offline sales reaching consumers both
digitally and physically. Hopefully in the coming years, marketers will connect
the dots through creative solutions that match their target audience’s
consumption habits.
1 comment:
I think you make a lot of good points here, especially on the idea that we've been hearing about the promise of mobile for years. I think that people are bullish on mobile advertising because we're seeing a huge "time vs. spend" gap on the platform. For example, per comScore, desktop interent takes up 22% of overall media time, but only 16% of ad spend. Mobile is a bigger gap, accounting for 23% of media time (larger than desktop internet) but only 1% of ad spend. This has to normalize at some point. Print is where it will likely come out, as it accounts for only 6% of time spent and 29% of ad spend.
Data from Ovum suggests that brands are going to spend more on mobile. 75% of their survey brands said they are going to increase their spend on mobile in the next two years (half of these said by over 50%). The rise of the tablet, where it's easier to put a display ad than a small-screen handset, should help mobile spend.
If I may, though, I would respectfully disagree with your view that Ms. Meeker is a "renowned venture capitalist." I have no issue with her, but she's been at Kleiner less than two years. She was an equity analyst at Morgan Stanley for many years, and got blown up in the last tech bubble like many others.
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