Agencies blamed for hampering mobile revenue growth: AOP

26/09/2012

Top UK publishers have blamed advertising agencies for being reluctant to invest in mobile ads despite the increasing numbers of people using smartphones and tablets, according to a new survey. The survey was conducted by Association of Online Publishers (AOP) amongst its members, which include most of Britain's major newspaper, TV, magazine and radio groups and account for 1,500 digital titles boasting combined web returns of over £1bn. When asked to name the "main inhibitors" towards the growth of revenues from wireless devices, 53.5% of the panel cited the attitude of agencies. This figure stood at 55% for smartphones and 52% for tablets.

Graph:Main Inhibitors to Revenue Generation from Mobile/Tablet

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Graph: Main issues affecting apps/mobile development

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Despite 87% of publishers receiving more than a fifth of their traffic via mobile, less than 29 per cent receive more than a fifth of ad revenue from mobile sources.

A dependency on low-yield advertising networks was mentioned as being problematic by another 52% of participants when discussing phones, compared with just 10% upon looking at gadgets like the iPad.

The limited size of the tablet audience, however, was an issue for 52% of contributors, and was also perceived as a hurdle by 31% of interviewees with reference to smartphones.

Despite these obstacles, 91% of the sample identified tablets as one of the areas offering the greatest opportunity for revenue growth next year, a total standing at 85% for mobile.

The AOP’s figures will worry publishers, who are failing to see reduced advertising revenues from lower print circulations offset by increased digital ad sales.

Despite the increase in mobile phones as a way of browsing the internet and reading news, advertisers are concerned about how to reach people on a smaller screen.

In a statement, the AOP said: "While more people than ever are consuming content on their smartphones and tablets, ad revenues are not migrating to those devices at the same rate."

The main issues facing publishers seeking to expand their activities in this space included the diverse range of devices in use on 72%, a lack of in-house skills and resources on 56%, and difficulties related to integrating mobile with current sales efforts on 47%.

Lee Baker, director of AOP, said: “We are going to see some fundamental changes to the mobile ad market over the coming year as ad agency attitudes catch up with publisher investment and mobile audience size.”

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Source: AOP

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