Location-based advertising is growing in popularity because marketers can easily target the ever-expanding population of smartphone users. According to a new report from BIA/Kelsey, this form of marketing is set to grow even further in to next few years. The research group's "Attribution: The Next Phase in the Age of Mobile Advertising" report predicts that by 2017, spending on location-based advertising will reach $10.8 billion, representing over half of all mobile advertising dollars.
BIA/Kelsey calculated that in 2012, $1.4 billion was spent on location-targeted mobile campaigns. So how will this number increase nearly eight-fold by 2017? According to Michael Boland, BIA/Kelsey's vice president of content, more businesses are seeing the benefits of using this type of campaign.
"Mobile holds a 12 percent share of consumer's current media consumption, but has a disproportionately low – three percent – share of U.S. ad dollars," Boland said in a press release. "However, we see a few factors that will counterbalance this in the coming year, including location-targeted ads and the ability to measure effectiveness through attribution technologies."
In an interview with Mobile Marketing Daily, Boland expanded upon his explanation, saying that American consumers spend significant portions of their time on mobile devices. It only makes sense then that advertisers would use this medium to reach them.
The BIA/Kelsey report also explores how effective location-based campaigns have been thus far. Promising conversion numbers indicate that this type of marketing will continue to be put in greater use.
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