xAd Releases 2012 Mobile Advertising Trend Report

xAd | 03/07/2013

Report reveals 95% of national advertisers now leverage some form of mobile location targeting

NEW YORK, March 7, 2013 /PRNewswire/ — xAd, the leader in delivering targeted mobile ads based on accurate user location and search context, today released its latest quarterly report, Mobile-Local Performance Stats, focused on annual mobile advertising trends throughout 2012. According to the report, which is derived from xAd’s network and campaign data from January 1 through December 31 of 2012, nearly 95% of all national advertiser campaigns now leverage some form of location targeting in mobile.

As a consumer’s exact location has shown to be a powerful factor in reaching and engaging desired mobile audiences, advertisers have started to shift from standard geo targeting, often seen in desktop or traditional marketing (based on standard geo boundaries such as zip, city or DMA areas), to geo-precise targeting, which leverages mobile’s unique ability to target users based on their specific location.

The report revealed that search behavioral targeting (targeting based on geo-precise mobile search behaviors), grew 212% from Q1 to Q4 2012 – more than any other mobile targeting technique. Although search behavioral targeting saw the most growth, geo fencing (the ability to reach a consumer based on a set proximity or distance away from a specific place or point of interest) was the most popular targeting technique overall, ending the year with over 55% of campaigns utilizing this type of targeting. Standard geo targeting, on the other hand, declined from 64% of campaign targeting in Q1 to just 13% by Q4.

This rapid shift in targeting focus can be attributed to the increased performance and efficiency experienced through more precise mobile targeting techniques. Across campaigns that leveraged more precise geo targeting, ad waste was reduced on average by 20-30%, while ad performance increased by double digits. Search behavioral targeting provided the highest lift on average, increasing performance 60% over the industry benchmark. Place-based targeting was a close second, delivering a 55% lift. Throughout the year, xAd’s display and search ads performed well above industry standard performance rates, with locally targeted display averaging a CTR of 0.8% and targeted search a CTR of 8%.

“Mobile users are in constant motion, so their circumstances and needs are continually changing,” said Dipanshu Sharma, CEO at xAd. “As a result, mobile targeting technology that serves the most relevant information to users, based on their exact location, will deliver the highest conversion rates for advertisers. As geo targeting techniques become more precise, advertisers can still achieve massive scale by working with partners that allow access to the billions of available mobile ad impressions nationally, enabling them to maximize ROI across a host of specific mobile audiences.”

Additional Highlights:

  • Likely because mobile users are typically on the go, the top businesses searched via mobile throughout the year continued to be local restaurants and/or businesses related to travel such as gas stations, transportation and hotels.
  • Top growth categories were Entertainment (including bars and clubs, theatres and sporting events/venues) which grew 184%, Health & Beauty (including beauty salons & spas, gyms, hospitals and other health services) which grew 50%.
  • In terms of advertising, only one of the top three search categories made it into the top advertising categories – showing a slight misalignment between mobile user demands and specific advertising penetration by vertical.
  • Regarding location of search, the South lead with four out of the top 10 cities for active mobile search activity throughout 2012.
  • The South also came in tops, tied with the Midwest, for most targeted cities for mobile advertising.

Click here download a copy of the Mobile-Local Performance Stats: 2012 Year in Review