Global Trends in Mobile Advertising Q3 2016

Transcription

1 Global Trends in Mobile Advertising

2 Global Trends in Mobile Advertising Smaato s Global Trends in Mobile Advertising report offers key insights into the mobile programmatic advertising landscape worldwide during. Our platform delivers up to 300 billion ad impressions each month, which are auctioned through a network of over 450 demand partners. Please note that this report reflects trends across Smaato s global base of publishers, advertisers and users during. Each report offers a quarterly snapshot, so specific data and observations may not be comparable with previous reports. Executive Summary During, we observed the following five global trends across the mobile landscape: 1. Strong Mobile Ad Spending Growth Continued in Global mobile ad spending continued to post robust growth (+64%) in Q3 versus the same quarter last year on the Smaato platform. Growth was driven primarily by the Americas (+77%) and APAC (+64%) regions, followed by EMEA (+22%). In each region, the 2 biggest markets each saw healthy growth and were the primary regional growth drivers. Japan, Turkey and Scandinavia were also regional growth standouts. 2. App Domination Accelerated, but Mobile Web Still Has Value As in previous quarters, mobile ad spending continued to shift in-app, which picked up 8 share points versus mobile web ad spending in Q3. In-app advertising now solidly dominates with 81% global ad spending share. Nonetheless, mobile web also continues to grow in absolute terms, up almost 4% from the same quarter last year with rising ecpms in Q3. 3. Android Dethrones ios as ecpm King, Apple Remains Top Device Brand for Ad Spending Android overtook ios as the ecpm leader on the Smaato platform and also remained the overall mobile ad spending leader (55% share). Despite device-side stumbles by both Apple and Samsung in Q3, Apple remained the global device brand that saw the highest ad spending on the Smaato platform (41% share), driven by its still high (but slightly lilting) ecpms and Android OS device fragmentation. Samsung remained #2, even with its Note 7 debacle. 4. Men are from Android, Women are from ios An ad request coming from a man s smartphone was more than three times as likely to come from an Android device than an ios device. However, an ad request coming from a woman s smartphone was 1.5 times more likely to come from an Apple (ios) device. Notably, this trend is strengthening. 5. Video Took Off in Video is surging on the Smaato platform, with video ad spending up 557% in Q3 versus the previous quarter and video ecpms growing 62% as well. Average video ecpms in Q3 were more than 9 times higher than the average overall ecpms on the Smaato platform. 90% of all video ad requests came from apps. Copyright 2017 Smaato Inc. All Rights Reserved. 1

3 1 Strong Mobile Ad Spending Growth Continued in Global mobile ad spending continued to post robust growth (+64%) in versus the same quarter a year ago on the Smaato platform. Growth was driven primarily by the Americas (+77%) and APAC (+64%) regions, followed by EMEA (+22%). Global Ad Spending Growth by Region & Top Countries vs. Q GLOBAL +64% AMERICAS +77% +885% Paraguay +223% Puerto Rico +204% Chile +178% Uruguay Canada Colombia +140% +131% APAC +64% +89% Hong Kong +81% Philippines Thailand +82% Taiwan USA +81% Malaysia +36% +334% Japan Costa Rica Peru +486% China Singapore Vietnam Australia EMEA +22% +79% +60% +59% +52% +42% +33% +300% Turkey +229% Egypt +113% Ireland Sweden +107% France Denmark Spain +99% +60% +43% South Africa +38% Germany +36% United Kingdom +33% Source: Smaato Publisher Platform (SPX) - Copyright 2017 Smaato Inc. All Rights Reserved. 2

4 In each region, the Top 2 biggest mobile ad spending markets each saw healthy growth in versus Q and were key drivers of regional growth on the Smaato platform. Top 2 Biggest Regional Mobile Ad Spending Markets (by Market Size) Market Size 1 and Growth 2 AMERICAS 2016 Market Size ($ Billions) 1 Ad Spending Growth vs. Q APAC 2016 Market Size ($ Billions) 1 Ad Spending Growth vs. Q EMEA 2016 Market Size ($ Billions) 1 Ad Spending Growth vs. Q USA $ % 1 China $ % 1 UK $ % 2 Canada $ % 2 Japan $ % 2 Germany $ % Sources: 1 emarketer, September 2016; 2 Smaato Publisher Platform (SPX) - Aside from the biggest regional markets by overall ad spending, key notable regional growth standouts were: Turkey (+300%), EMEA s overall growth leader, is a highly wireless nation considered one of the world s digital banking leaders. With one of Europe s youngest populations (some 60% of Turks under 35, and 40% under 25 1 ), Turkey leads the world in percentage (44%) of consumer purchases made from a mobile device (global average is 31%) 2. Scandinavia continues to be strong, as already noted last quarter in our previous report. Latin American countries, such as Paraguay (+885%), Chile (+204%), Uruguay (+178%), Columbia (+131%) and Peru (+36%), all grew as a result of relatively solid economies and modest advertiser spending in the same quarter last year. 1 Turkey Leapfrogs Europe In Mobile Services, Global Finance Magazine, gfmag.com, October 14, A Global Perspective of Mobile Commerce, IAB On Device Research, September 2016 Copyright 2017 Smaato Inc. All Rights Reserved. 3

5 2 App Domination Accelerates, but Mobile Web Still Has Value As in previous quarters, in-app continued to pick up mobile ad spending share versus mobile web in Q In-app now solidly dominates ad spending on the Smaato platform with 81% share, up 8 share points versus the same quarter last year. In-App vs. Mobile Web Share of Ad Spending Revenue Q % 27 % 19 % 81 % 73 % 67 % In-App Mobile Web Source: Smaato Publisher Platform (SPX) - Moreover, the dominance of in-app over mobile web ad spending is a worldwide phenomenon, true in both advanced as well as emerging markets. In most of the biggest markets except Indonesia, in-app mobile ad spending outpaces mobile web ad spending by a ratio of at least 2-to-1 (and it s really close to 2-to-1 in Indonesia as well). Copyright 2017 Smaato Inc. All Rights Reserved. 4

6 In-App vs. Mobile Web Share of Ad Spending in Select Countries Sweden Canada UK 78 % 90 % Germany Russia 87 % Mexico 87 % USA 83 % Argentina 85 % Brazil 84 % France 88 % Turkey 89 % South Africa 67 % 94 % India 83 % 97 % China South Korea 99 % 81 % Indonesia Singapore 73 % 63 % Japan 67 % Australia 70 % In-App Mobile Web Source: Smaato Publisher Platform (SPX) - Why is in-app spending so much higher? Mobile users worldwide are spending more and more time in apps (i.e. 79% of all ad requests on the Smaato platform come from apps) and advertisers are willing to pay more for the superior user tracking and data availability of the in-app environment. In-app ecpms are, on average, more than two times higher than mobile web ecpms on the Smaato platform, a trend that has remained consistent with the same quarter last year. Copyright 2017 Smaato Inc. All Rights Reserved. 5

7 Fast Stats: In-App vs. Mobile Web In-App ecpms 2x Higher than Mobile Web ecpms 1 In-App 79% of all Ad Requests 1 In-App Ad Request Growth 2 +53% Mobile Web 21% of all Ad Requests 1 Mobile Web Ad Request Growth 2 +4% Mobile Web ecpm Growth 2 +10% In-App Mobile Web Sources: 1 Smaato Publisher Platform (SPX) - 2 Smaato Publisher Platform (SPX) - vs. Q Nonetheless, mobile web is far from dead and still represents 21% of all ad requests and 19% of all mobile ad spending on the Smaato platform, up almost 4% from the same quarter last year. Notably, mobile web ecpms are on the rise, increasing more than 10% on average in versus the previous quarter, indicating advertisers still value this environment. Copyright 2017 Smaato Inc. All Rights Reserved. 6

8 3 Android Dethrones ios as ecpm King, Although Apple Remains Top Device Brand for Ad Spending As smartphone sales continue to grow, the battle for operating system (OS) market share is clearly being won by Google s Android, which continued to capture share at the expense of Apple s ios. Android commanded nearly 88% of the Q3 total global mobile OS shipment market in (up from 86.2% in the previous quarter 3 ) according to Gartner 4. In fact, all other major operating systems except Android lost both share and units in versus the same quarter last year. Market Share by Mobile OS Shipments 0.7 % 11.5 % Android ios 87.8 % Other Source: Gartner, November 2016 Despite Android s overwhelming market share dominance, advertisers have historically placed a premium on Apple ios users, paying higher ecpms for a presumably more affluent demographic able to pay the comparatively higher prices of Apple devices. Apple s ecpm advantage has been eroding in recent quarters, and in Q4 2015, we projected that Android ecpms would pull even with those of ios in as early as Q The tipping point came earlier than expected. 3 emarketer, November 16, Gartner, November 17, 2016 Copyright 2017 Smaato Inc. All Rights Reserved. 7

9 Android unseated ios to become the new ecpm leader on Smaato s SPX platform in. A rise in Q Android ecpms together with declining ios ecpms contributed to this leadership change. In fact, since the end of 2014, Android ecpms have increased 55.3% on the Smaato platform while ios ecpms have fallen 3.4% over the same period. Android vs. ios ecpm Q ios ecpm Android Source: Smaato Publisher Platform (SPX) - Driven by its favorable ecpm trends, Android reigns as the overall mobile ad spending leader on the Smaato platform. In, Android accounted for a steadily increasing 55% of global mobile ad revenue generated by publishers, as ios share continued to erode, accounting for 41% of global mobile ad spending in, down from 43% ad spending share at the end of Global Ad Spending Share by OS 3.5 % Android 41.8 % 54.7 % ios Other Source: Smaato Publisher Platform (SPX) - Copyright 2017 Smaato Inc. All Rights Reserved. 8

10 On the smartphone handset/hardware side, despite a third quarter of consecutive decline in the overall worldwide device market (-2.6% Q3 versus year ago 5 ), saw global smartphone sales continue to rise (+5.4% in versus same quarter last year 6 ), even as overall mobile phone sales fell (-1.3%, due to the declining popularity of feature phones 6 ). In fact, among all devices, smartphones and Chromebooks were the only device types that posted sales gains in Q3 versus previous year according to Gartner, with traditional tablets showing the steepest decline. Worldwide Smartphone Sales to End Users by Top Vendors (in Millions) Overall Shipment Q Samsung Apple Huawei Oppo BBK Communication Equipment Source: Gartner, November 2016 Among smartphone devices, top-two device manufacturers Samsung and Apple stumbled - Samsung (-14.2%, its worst performance ever) with its Galaxy Note 7 battery debacle and Apple (-6.6%, its lowest share since Q1 2009) with its iphone7 launch that struggled to stimulate replacement. In fact, Apple s sales fell by 8.5% in the U.S. and by 31% in China, two of its biggest markets. 6 The market leaders thus opened the door for rising star manufacturers, such as Huawei, which closed its device share gap slightly versus Apple. Despite being a share winner, however, Huawei has two serious domestic competitors - Oppo and BBK Communication Equipment - who each doubled their respective market shares in Q Gartner, November 14, Gartner, November 17, 2016 Copyright 2017 Smaato Inc. All Rights Reserved. 9

11 Global Top 10 Device Brands by Ad Spending 1.0 % 1.1 % 1.7 % 1.7 % 1.9 % 2.6 % 6.8 % 7.1 % 26.0 % 41.0 % Apple Samsung LG Generic Motorola HTC Generic Web Browser ZTE Alcatel Sony Source: Smaato Publisher Platform (SPX) - On the Smaato platform, Apple continued its reign as the global device brand with the highest ad spending, capturing 41% share driven by its still high (albeit slightly lilting) ecpms and Android OS device fragmentation. Samsung followed with 26%, even with its problems, while LG came in third at 7% of all global ad spending on the Smaato platform. Copyright 2017 Smaato Inc. All Rights Reserved. 10

12 4 Men are from Android, Women are from ios While Android is the undisputed overall worldwide mobile OS market leader and also leads ios in ad spending on the Smaato platform, there are distinct and notable gender differences among these two rival mobile operating systems. Android vs. ios - Share of Global Ad Requests by Gender 2.6 % 40.3 % 21.6 % Android ios 59.7 % 75.8 % Other Source: Smaato Publisher Platform (SPX) - In the majority of ad requests on the Smaato platform coming from smartphones owned by women came from ios devices, while the majority of ad requests from smartphones owned by men came from smartphones running Android. An ad request coming from a man s smartphone is more than three times as likely to come from an Android device than an ios device. An ad request coming from a woman s smartphone is 1.5 times more likely to come from an Apple (ios) device. Notably, this trend is strengthening - the likelihood that an ios ad request comes from a smartphone owned by a woman and an Android ad request comes from man s smartphone is increasing from Q2 to Q3 (and - sneak peak - even more so in Q4) Copyright 2017 Smaato Inc. All Rights Reserved. 11

13 Android vs. ios - Share of Global Ad Spending by Gender 40.3 % 69.5 % Android ios 59.7 % 30.5 % Source: Smaato Publisher Platform (SPX) - For ad spending on the Smaato platform, this trend is true as well. Ad spending sent to women s smartphones is predominantly taking place on an Apple ios device, while ad spending directed to men s smartphones is overwhelmingly to a (non-apple) Android device. Gender Share Split by Operating System, Ad Spending and Revenue Ad Requests Ad Spending Android 72.1 % 27.9 % 63.3 % 36.7 % Female Male ios 34.3 % 33.8 % 65.7 % 66.2 % Source: Smaato Publisher Platform (SPX) - Conversely, if an ad request is coming from an Android device, the probability of that device belonging to a man is 72.1%. Whereas if an ad request is coming from an Apple device, that smartphone most likely (65.7% likelihood) belongs to a woman, for all ad requests passing gender data on the Smaato platform. Copyright 2017 Smaato Inc. All Rights Reserved. 12

14 5 Video Takes Off in Video is surging on the Smaato platform, as advertisers and publishers alike flock to this engaging format. On the advertiser side of Smaato s global ad exchange, video ad spending grew 557% in Q3 versus the previous quarter, with video ecpms growing 62% as well. On the publisher traffic side, video ad requests on the Smaato platform increased 608% in Q3 versus Q Growth of Video Ad Spending, ecpms and Ad Requests vs. Q % +608 % +62 % ecpm Ad Spending Ad Requests Source: Smaato Publisher Platform (SPX) - Average video ecpms were more than 9 times higher than the average overall ecpms on the Smaato platform in. While rich media banner ads (320x50) were still the most popular ad format, video ads garnered 6.8 times higher ecpms. Copyright 2017 Smaato Inc. All Rights Reserved. 13

15 By geography, worldwide video ecpms were overwhelmingly highest in the USA, with fellow native English speaking markets Canada, Australia, New Zealand, the UK and South Africa all landing in the Top 10 video ad spending markets as well. Germany was a particular non-english speaking ecpm standout among the top 10 biggest countries by video ad spending. Indexed Video ecpms among Top 10 Countries by Video Ad Spending Canada 270 New Zealand 180 Spain 100 USA 860 Australia 240 UK 170 France 100 Germany 190 Mexico 140 South Africa 100 Source: Smaato Publisher Platform (SPX) - Most video activity on the Smaato platform happened in-app, as 90% of all video ad requests came from apps. Additionally, in-app video ecpms were 1.5 times higher than those of mobile web video ads. Copyright 2017 Smaato Inc. All Rights Reserved. 14

16 Share of Video Ad Spending by Ad Size 41.6 % 27.5 % 7.3 % 5.3 % 4.7 % 320x480 (Full Page Interstitial) 300x250 (Medium Rectangle) 480x x x50 Source: Smaato Publisher Platform (SPX) - Full-page interstitial video ads were the most popular video format among advertisers on the Smaato platform, accounting for 41.6% of video ad spending in. In terms of ad requests, the medium rectangle video format drove the most ad requests at 58.3% of all video ad requests last quarter. Given the high-engagement factor of the video format and its utility particularly to brand advertisers, we expect video to continue its high growth adoption in Q4 and into Copyright 2017 Smaato Inc. All Rights Reserved. 15

17 Thank You We hope you ve enjoyed Smaato s report on Global Trends in Mobile Advertising -. To download white papers, read case studies and subscribe to our monthly publisher & app developer newsletter, visit us online at About Smaato Smaato is the leading global real-time advertising platform for mobile publishers and app developers. Smaato runs the world s largest independent mobile ad exchange and has been pioneering innovative, mobile-first solutions for publishers since The Smaato Publisher Platform (SPX) is a global, intelligent and free-to-use self-service platform and ad server that brings native, video and real-time advertising to over 90,000 app developers and mobile publishers. The company s worldwide reach and extensive network of 450+ demand partners provides a massive variety of advertisers with one single integration. Smaato manages up to 10 billion ads every day around the world, across over 1 billion unique mobile users each month. Copyright 2017 Smaato Inc. All Rights Reserved. 16