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BizReport : Mobile Marketing : December 20, 2017

Forecast: Mobile ad costs to skyrocket

Over the next two years, experts from Goodway Group believe mobile ad rates will skyrocket, increasing by at least 45% over the time period.

by Kristina Knight

The study focuses on the costs of programmatic ad pricing. Also during the time period, their experts are predicting only about a 3% increase in the costs of desktop ads. The mobile increases are expected to come at a rate of about 4% month to month, and will include both mobile display and video ads which are served either in-app or via browsers.

"Mobile advertising has been historically undervalued because it has been siloed or considered secondary to desktop. However, with consumer behavior shifting to mobile and advertisers shifting to people-based marketing efforts, it's no surprise that prices for mobile ads are going way up next year," said Jay Friedman, COO, Goodway Group.

Machine learning, says Friedman, will be driving much of the increase, as it gives marketers more control over budgets, by helping to define impression values, and, he believe advanced algorithms will continue pushing the evolution of digital marketing. How can marketers put this into action? By focusing on the individual, not the device used to go online.

"Most savvy media buyers today now pivot their media plans first around the individual and all the devices that person may use, as opposed to targeting each device in a silo. As a result, demand for mobile, i.e., cross-device inventory will rise and continue to rise as marketers increasingly align their media plans with consumer behavior," said Friedman. "As long as the popularity of an on-the-go lifestyle continues to increase, it's likely that mobile pricing will too. Can you expect that one day mobile prices will stabilize too? Sure, but when is the million-dollar question. Of course, no one likes seeing the price of things they need to buy rising, but the underlying causes of these price increases aren't so bad when you dig deeper. Increases in mobile ad prices stem partly from new advertisers incorporating a cross-device strategy into their media mix. Price inflation that comes from rising demand means a positive overall industry growth."

Tags: Goodway Group, mobile ad costs, mobile ad forecast, mobile marketing, programmatic mobile advertising

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