Forecast: Mobile Advertising To Grow 36% In 2009

A new report published this week suggests that despite the overall marketing slowdown, mobile advertising will increase by at least 36% in 2009 thanks to a few key advancements expected to take place by year’s end and into 2010.

The new report, released by Magna, forecasts the US market for mobile advertising will grow by 36%, rising from $169 million in 2008 to $229 million during 2009. While it doesn’t represent the huge growth pattern observed in previous years, the report points out that a resurgence in the industry will take place in 2010 due to the proliferation of mobile-based subscriptions and ad-supported mobile applications.

Mobile applications in general, as well as the optimization needed for effective advertising to support mobile applications, are still very much evolving. This brand new ecosystem needs plenty of time to evolve before hitting the mainstream. “The app store business model is a fascinating one, an open source environment where two guys in a garage can build an application, and do so with meaningful scale. The advertising market will come eventually, though maybe not for a 12-month time period,” said Brian Wieser, global director of forecasting at Magna.

In addition to the growth expected from mobile-based subscriptions and ad-supported mobile apps, Magna forecasts that the overall “organization” of mobile ad networks will play a large role in the next generation of mobile marketing. The report calls mobile networks the largest sub-sector within mobile advertising and the area that will see the greatest growth in absolute terms over the next several years.

By aggregating billions of advertising impressions on a monthly basis, ad networks represent the most efficient way to sell the largest possible collection of audiences, and thus have become the primary beneficiaries of increasing mobile web consumption. However, with the increasing number of ad networks and the limited amount of inventory each one are promoting, some major re-organization and consolidation will be needed in the near future to keep the momentum going.

As always, the future of mobile advertising remains bright despite downturns- but the single most factor that will drive the most growth, in my opinion, are mobile applications and the integrated advertising that will support them. While the report suggests that a combination of mobile subscriptions, mobile ad networks and other segments will be at the forefront of the industry’s growth, I think none will match the opportunities that ad-supported mobile apps will bring to the table.