App Advertising Reached Will Exceed $44 Billion By 2020

By Frederique Bros
on 28 March 2016

According to Juniper Research the App Advertising optimised by location and context will reach $44bn by 2020 and an estimated $13 billion last year.

Let’s see in details the increase forecast over the next five years.

As the mobile advertising landscape matures, the simple geofence is being usurped by contextual data such as a user’s interests, real-time location and even political leanings.

Social Apps Continue to Lead

The new research, Context & Location Based Services: Advertising, Retail & Emerging Technologies 2016-2020 found that social applications are providing a highly accessible pool of rich user data for advertisers. Indeed, Facebook’s recent earnings call highlighted the tremendous growth opportunity of this sector, with North American ad revenues per user rising by 60% over the last 12 months.

Meanwhile, players such as Pinterest are developing tools that serve to reduce the intrusiveness of adverts, with user-friendly approaches seen as crucial in avoiding a rising tide of ad-blocking utilities.

According to Juniper Research, in terms of ad revenues, the leading social applications using mobile location data to target users are:

  1. Facebook
  2. Twitter
  3. Instagram
  4. WeChat
  5. Sina Weibo

The research found that social apps are beginning to incorporate a wide range of capabilities beyond their core function as peer-to-peer communications tools. “This trend has been highlighted by apps such as WeChat in China, while Facebook Messenger has recently partnered with Uber to deliver ride hiring services” noted research author Steffen Sorrell. “This means that social apps are transforming into platforms themselves, offering even more data for ad campaigners.”

The Next Wave – Proximity Marketing & Indoor Location Targeting

Additionally, the research found that several factors are creating a ‘perfect storm’ for the commercialisation of indoor location services. Bluetooth beacon deployments, improved Wi-Fi services, and the re-emergence of UWB (ultra-wide band) as an enabler of location based services are all likely to combine in the near-term to offer proximity marketing opportunities as well as commercial asset tracking capabilities.

Other Key Findings

  • Commercial asset tracking and telematics is likely to be boosted significantly by the ISO approval of the AEM/AEMP Telematics API Standard.
  • Big Data and the emergence of prescriptive analytics will play an increasingly important role in the commercial telematics and precision agricultural industries.

Juniper Research provides research and analytical services to the global hi-tech communications sector, providing consultancy, analyst reports and industry commentary.

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