Mobile ad expenditure growth fuelled by rise in in-app video

Anne Freier | September 5, 2018

Mobile Advertising

Mobile advertising spend grew 25% year-on-year in Q2, according to a new report from publisher sell-side platform PubMatic.

The report highlights that whilst desktop ad spend is predicted to remain largely flat between 2017-2020, mobile advertising spend is declining towards a more stable spend growth rate of 17% in 2020.

Monetized mobile ad impressions jumped 26% during Q2 in 2018. Meanwhile, APAC saw the greatest change at 168% compared to 2017, compared to 19% in the Americans and a -0.8% change in the EMEA region.

In-app ad spend now represents over half of mobile ad spend and the format continues to grow at 21% in Q2 2018 YOY. The growth is largely driven by iOS (47%) whilst Android had a 13% growth rate.

This shift is also evident in CPMs. Mobile eCPMs dropped 16% during the measurement period due to lower pricing, whilst in-app eCPMs rose 11% during Q2.

Much of in-app ad spend is now fuelled by video formats. Indeed, in-app video rose 688% YOY to a 63% share of total mobile video ad spend. Overall, mobile video grew 239%.

“We are continuing to see the rise of in-app at the core of programmatic ad spend. As consumer engagement steadily shifts to mobile app environments, and the potential for both publishers and advertisers to capitalize on this trend is huge,” said Paulina Klimenko, senior VP of corporate development at PubMatic. “At PubMatic, we are committed to providing publishers with the technology and tools to monetize this growing audience while also pushing for the same quality standards for apps that we have seen emerge for desktop and mobile web.”

At the same time, the report notes that in-app private marketplace (PMP) impressions grew 244% YOY to a share of 36%. PMP volume improved just 6% and was down 13% on desktop. It is likely that the rise in PMP usage is being fuelled by a fear of advertising fraud.

Many ad buyers consider in-app PMPs to be a safer option for inventory.

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