Mobiles leading spending spree for online ads

Oliver Smith
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COMPANIES spent a massive £3bn on online advertising to reach UK consumers in the first half of the year, up 17.5 per cent from a year earlier.

A report by PwC and the Internet Advertising Bureau found that mobile advertising also grew 127 per cent from the same period in 2012, making up £429.2m of the spending, a rise driven by smartphone ownership as advertisers increasingly use mobile campaigns.

“With smartphone penetration crossing the two-thirds landmark and the successful roll out of 4G, 2013 could be the year when advertising spend on mobile crosses the £1bn threshold,” said Tim Elkington, director of research and strategy at the Internet Advertising Bureau.

Firms are splashing out the equivalent of £66 per person in the UK, based on the country’s 46.1m internet-connected households.

Consumer goods became the most advertised product category, overtaking entertainment and media from the top spot last year and amounting to 26.8 per cent of the spend.

“The fact that consumer goods – such as food, clothing and jewellery – account for over one quarter of mobile display advertising shows how important brands regard smartphones as key to consumer buying behaviour,” said PwC senior manager Anna Bartz.

“Mobile has moved on from being a communications or entertainment device to a bona fide retail one. It’s an interesting contrast to how dominant entertainment has become on ‘fixed’ devices such as computers and laptops,” added Bartz.

The largest amount was spent on paid-for search – some £1.81bn, or 59 per cent of the total – as advertisers buy placement on search results from Google and Yahoo.

Micro-blogging site Twitter revealed last week that it hopes to attract more advertising revenue as it gears up for a $1bn initial public offering in the US.