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Digital marketing tips and advice.

$5 Billion by 2016 in Mobile Local Ad Spent, Largest Growth Expected in Paid Search

Ryan Buddenhagen, April 3, 2012

There is news seemingly coming out daily regarding the possibilities that smartphones present businesses in terms of widening exposure and growing business. This is essentially because of all the sectors that smartphones and their functionality and features touch. The impact is clearly seen and only growing in the years to come especially regarding mobile local searching both at home in the US (where smartphone adoption has just reached the 50% mark) and abroad.

Now, recent figures from market research firm BIA/Kelsey forecast key mobile local search and advertising figures that shine a light on where mobile local is heading. First, the amount of mobile local search queries will equal the number of local searches performed on desktops by 2015. Analysts predict this for two main reasons:

  • The number of local searches made per user will increase from roughly 14 per month to 42 per month in 2016.
  • The number of users performing mobile searches will rise from 44% of US smartphone users to 75% in 2016, in raw numbers that is 118 million users to 225 million users.

The sheer volume of local searches appears to be at the center of mobile local advertising, especially its growth. The numbers also addressed mobile local advertising spend expected from now until 2016. Sustained growth across display ads, search ads, SMS, and video is all projected with total mobile local ad spend increasing from $784 million in 2011 to $5 billion by 2016. For example, from $390 million in spend during 2011, the figure for mobile local search ads is expected to reach $3.2 billion in 2016. A thorough piece in Search Engine Watch presents and explores these figures and offers additional insight regarding how search is driving this growth. As such, local search is immensely important and there is great potential for SEO companies that engage in paid search advertising and for businesses to supplement paid search ads with organic SEO.

Geo-Targeted, Mobile Social Ads
The greatest potential yet discussed is that for location-targeted mobile search advertisements. Click-through rates (CTRs) are an excellent indicator of value and reporting from xAd, a mobile local advertising network, shows CTRs for geo-targeted in-app search ads at 7%. According to the above Search Engine Watch piece, this 7% CTR is 10x better than ads that are not geo-targeted. Still further, there are promising figures for the amount of "secondary actions" such as phone calls made after the initial clicks - which is experienced in 37 % percent of them. These figures are very telling and truly represent the importance of all forms of search, especially local search and geo-targeted local search.

Role of SEO
SEO companies can assist businesses in capitalizing on rising mobile local searching. The numbers obviously project the rise of paid search spend, but they are based on the increase of search activity itself, so there is true value in SEO efforts. Businesses can partner with SEO companies and marketing professionals to supplement their paid search efforts with SEO engaging in a fully coordinated, multi-faceted internet marketing campaign. Utilizing SEO and implementing geo-targeting practices within it can bring businesses improved ranking results across search engines and drive more location-targeted traffic overall.

For more information on how your business can leverage SEO in this way, reach out to me directly at rbuddenhagen@webimax.com or connect with us via our contact page.

Need an Expert Contributor?

Ken Wisnefski is a seasoned web entrepreneur and a frequent contributor to news outlets and business publications. Ken’s vast knowledge of how to make online businesses succeed has made him a sought after consultant from businesses wishing to improve their online initiatives. Contact pr@webimax.com to collaborate!


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