Mobile local ad revenues in the U.S. are expected to hit $4.5 billion this year, according to a new report from BIA/Kelsey. That would be a massive increase over last year, which saw $2.9 billion.
And that's really just the beginning. The firm is projecting mobile local ad revenues to more than triple over the next five years, reaching as high as $15.7 billion in 2018.
It expects mobile ad spending in general in the U.S. to reach $11.4 billion in 2014 and $30.3 billion in 2018. By the end of that year, it says, locally targeted mobile ads will be 52% of overall mobile ad spending in the U.S.
“Advertiser demand will be driven by natural market forces to follow undervalued inventory,” said Michael Boland, senior analyst and VP of content at BIA/Kelsey. “Mobile advertising’s appeal includes higher performance, clearer ROI, tangible conversions and a shorter purchase funnel. These qualities of mobile content and advertising present a rare alignment between typical mobile user intent and advertisers’ stated objectives.”
Tactics like geo-fencing, click-to-call, and click-to-map are helping drive up spend on mobile local advertising, according to the firm.
BIA/Kelsey expects mobile search ad revenues to grow from $4.3 billion in 2014 to $10.9 billion in 2018, native social ad revenue to grow from $3.3 billion in 2014 to $9.9 billion in 2018, mobile display (app and mobile web) ad revenue to grow from $2.4 billion in 2014 to $6.1 billion in 2018, mobile video ad revenue to grow from $1.1 billion in 2014 to $3.1 billion in 2018, and SMS ad revenue to grow from $332 million in 2014 to $381 million in 2018.
Image via BIA/Kelsey