Rise In Inventory Pushing Mobile Advertising Rates Down
-
Comments (View)
- Text Size: A A
-
Email
-
Share
Mobile advertising rates are going south. But it’s not just the weakening economy bringing down prices, it’s the “onslaught of inventory” going mobile, reports AdAge.com. Last year, the price of mobile CPMs—or the cost of reaching 1,000 mobile consumers—ranged from $40-$50, and earlier this year, they came in at $20-$25. But now, as more brands establish themselves on the mobile web, and device applications and social media apps proliferate, the glut in inventory has lowered CPMs to an average $15.
On the face of it, falling mobile CPM prices doesn’t sound good. But industry players argue that the sector is actually maturing, so pricing, once arbitrary, is stabilizing. Moreover, a wider range of CPMs is on offer, promising varying degrees of “targeting granularity.” Whereas last year, an advertiser might have been stuck paying $40, now they have a choice from a less targeted $2 CPM to a more specifically targeted $30 CPM. Plus, mobile impressions, while more expensive than online, still gets better responses with average click through rates of 1.5 percent versus 0.15 percent for online.
Other AdAge.com highlights after the jump…
— Booming inventory: What’s accounting for the new inventory? Games, and you guessed it, iPhone apps, make up a “sizable share.” Sports sites have boomed, as well as those to Latino audiences, who are higher users of mobile phones and services compared to other demographic groups.
— Operator deck still the place to be: Targeted placement on an operator’s deck that accesses the mobile web is still where advertisers want to be, with pricing “commanding a premium.” High-traffic areas include weather, news, and sports. Prices for these categories have stayed “firm,” bringing in $14-$16. Highly targeted applications can command as a price as high as the mid $30’s.
— Bargains to be had: Some brands are offering $2 CPM, while social media sites are pricing CPM’s under $5. Less established sites also offer lower cost CPMs. Smaller and medium sized sites are also being aggregated into performance networks, which are sold on a CPC [cost-per-click] basis.
— Recession impact: Ad execs believes mobile CPMs will stabilize and hold their price in the next immediate quarters, but the recession will hurt. Demand should slow, which will mean lower CPMs.
Posted In: Advertising
Kindle (Free)
Social Standing
Which media brands are getting a lift from Tweeters and bloggers right now -- and which are getting panned?
Show Me: