SA mobile ad revenue to reach a billion rands by 2012

Predictions from upcoming Mobile Mindblast conference suggest that mobile ad revenues in South Africa totalled approximately R500-million in the last year. Year-on-year growth trends indicate that this figure will double by 2012. Estimates on mobile ad spend include display, search and message-based ads.

Jason Probert, Head of Vodacom Mobile Media, a conference partner, says: “Previous estimates have dramatically underestimated the size of the mobile advertising industry as they focused on reports submitted to the DMMA by online publishers. When you take into account the entire mobile advertising ecosystem and include mobile ad networks like AdMob, operator services like Apple, mobile search and social networks like MXit, the picture is dramatically different”

Juan du Toit, head of international business development and marketing for MXit, another conference partner, believes that South Africa will see substantial growth in media performance on mobile platforms this year and in 2012.

“The way that consumers interact with brands is evolving rapidly. Media strategists know that mobile media campaigns deepen the engagement and relevance of brands within their target markets. One of MXit’s core strengths to an advertiser is our ability to create and grow communities of loyal brand consumers and activists, which, in turn, offers an intriguing and difficult-to-ignore value proposition for the South African marketing industry.”

The Mobile Media Mindblast conference takes place in Cape Town on the 3rd of June 2011. Renowned international speaker Joseph Jaffe will explore the aggressive mobile growth trends and focus on what this means for brands and marketers in the South African marketing context.

In addition, speakers will provide guidance on how brands and marketers can harness this growth and shed light on successful mobile marketing tactics to reach the target audience. Topics will include the latest on mobile social networking, the advantages of permission-based mobile messaging and the benefits of marketing through local search. A panel discussion will feature successful mobile case studies by leading South African brands and agencies.

Head of Google Mobile, Brett St.Claire says: “We’ve had a fantastic response since we announced the conference a few weeks back and we’re almost booked to capacity from both the brands and agency sides. The popularity of Mobile Media Mindblast is a testament that marketers feel that they can no longer ignore mobile’s aggressive growth and that they need to learn more about this space and.”

Growth of SA Mobile Trends

More key growth trends
According to recent reports, global mobile advertising spend is expected to grow by 50% annually, from $12.6bn in 2011 to US$41.8bn by 2015. Display advertising is the biggest format in the mix currently making up US$6.8bn, followed by Mobile Search US$3bn and In-app advertising 3rd with $2.2bn. The remaining spend is made up of Messaging, Streaming Music, Mobile TV and Mobile Video.

In South Africa mobile messaging ads lead the way, followed by display and in-app formats. 35-million branded Please Call Me messages are sent out daily and currently we are seeing 1.6 billion impressions served annually in South Africa. The typical global mobile browsing session involve 5-8 mobile websites.

In countries like South Africa and BRIC countries Brazil, Russia, India and China, mobile is considered the primary screen, as opposed to in the US and Western Europe where it is viewed as merely an extension of the web. In China the growth rate for mobile ads is more than double that of the United States.

In emerging markets, mobile is the primary means to the internet. This, together with cheaper data rates and more affordable smart phones, is considered to be the main driving force of its phenomenal growth in South Africa. The country’s low internet connectivity penetration (10%) and high broadband costs will further drive consumers to mobile.

Mobile Social Networking
Globally spend on social networks is expected to increase with 71.6% to US$5.97 billion, approximately 8.7% of the total predicted online spend in 2011. According to eMarketer’s predictions mobile advertising is growing faster than social media advertising.

MXit could be seen as the best testament to the growth potential and interest in the South African mobile media space. As the largest mobile social network on the African continent, MXit continues to expand its community by between 45 000 and 50 000 new users per day. It has more than tripled its user base to close on 37 million users in the last two years and has a bigger reach than any other social network in Southern Africa, including Facebook and Twitter.

MXit, which started as an instant messaging platform in 2006, has since evolved into a fully-integrated mobile social platform that offers a spread of features, tools and social upliftment portals that keep consumers excited, interested and participative.

Other media
Global research shows that one-way media advertising like, print and radio are in steep decline. Print advertising is expected to drop by 6% to US$21.4-billion by the end of 2011.

Current trends show that if growth rates continue like they are now, that global digital ad spend will completely overtake television spend in the not too distant future. In 2010 US online advertising (US$26-billion) already surpassed spend on newspapers (US$22.8-billion) and radio (US$15.3-billion).