Brands ditch mobile banner ads

Warc, 18 August 2014

LONDON: Banner ads now account for just 4% of mobile ads run by entertainment brands as they turn to video and rich media formats to take advantage of people's increasing video consumption on smartphones, according to a new report.

Mobile video advertising company Vdopia analysed entertainment mobile ad campaigns viewed by 23m people in the UK over a year-long period and found the number of mobile ad campaigns run by entertainment brands through Vdopia's technology increased by 46%, making it the highest spending sector on mobile ad campaigns.

At the same time, the share of banner ads dropped from 14% to 4% in just six months. Video and rich media formats now account for 96%.

"The mobile ad landscape transformation from static banners to more engaging and interactive video and rich media formats is astonishing," said Farzad Jamal, Vdopia's European vice president.

But he was not surprised to see entertainment brands leading the change, pointing out that 23m Britons viewed entertainment content via smartphones and were over 40% more likely to recall ads than the average smartphone owner. Further, the entertainment sector accounts for 15% of UK smartphone app time, according to Nielsen figures, behind only social and games.

Vdopia's report also revealed that mobile advertisers may be misdirecting their investment into longer video formats as shorter ones are actually more effective.

Its Video Performance Index (VPI) – a measure of the effectiveness of video ads by completion and click through rates – showed that ten second ads were 65% more effective than the average video ad but attracted just 3% of mobile video adspend. Longer ads – of 20 seconds and 30 seconds – accounted for nearly three-quarters of entertainment brands' mobile video ad spend but were 27% and 13% less effective, respectively, than the average.

"You'd expect shorter ads to have a higher completion rate but, generally, the shorter the ad the more likely people are to engage with it – ten second ads are twice as effective as 20 second ones," Jamal said.

He suspected that the reason for budgets being allocated to longer ads was that marketers were simply re-purposing TV ads for mobile. This, he said, was "a viable solution if the ad can be shortened by removing any secondary messaging and adding an interactivity element".

"Even for a mobile-dedicated video ad, keeping the length short should prove to be a winning strategy for marketers," he concluded.

Data sourced from Vdopia; additional content by Warc staff