Last week, the Internet Advertising Bureau released their 2011UK mobile ad spend figures. These figures are reported in a yearly study that the IAB conducts with PwC, which has become the de facto indicator of mobile advertising growth. 2011 has yielded some encouraging figures, with over £203 million in UK advertising spend and an estimated 157% like-for-like increase in comparison to 2010. These numbers are especially significant when considering that experts like First Partner originally predicted 2011 spend figures to be around £142 million.

As expected, mobile search has accounted for the majority of spend (66%), followed by display (29%). Spend for every type of advertising has increased by more than 145%, with the exception of tenancy buys which have reportedly decreased slightly by 30%. The single largest percentage of growth has come from messaging (SMS/MMS), which is now being increasingly used by advertisers (in part due to advancements in technology and targeting capabilities like proximity targeting).

The IAB also reported that mobile display advertising spend more than doubled for some industry sectors whilst it declined for a couple of others. Whilst the finance sector was reported to experience an 81% decrease in spend, mobile ad spending increased across nearly all other categories. The technology sector saw the highest year-on-year growth at 180%, whilst retail industry spend increased by 123%. An increase across each of these sectors is not surprising considering that mobile advertising can provide a tactical and strategy opportunity for technology and consumer electronics companies to reach tech savvy users - e.g. consumers regularly consuming media via their smartphones.. Moreover, the steady acceleration of m-commerce and the ever-growing number of fully transactional retailer mobile sites gave us an indication that ad spend would eventually follow. As our own Steve Parker has recently stated in a MediaWeek piece on these ad spend figures, “Retailers that are committing to investing in this space are reaping the early rewards and preparing themselves for the inevitable change. Retailers that embrace this are also seeing new peak shopping times outside of traditional desktop times, proving that it isn’t simply cannibalising audience but adding to it”.

However, despite these promising figures, there’s a gap that still exists between overall time spent by consumers on mobile devices versus ad spending allocated to them. Some reports indicate that ad spend represents about 1% of advertising budgets although nearly a quarter of all time spent online happens via mobile. This clearly shows that advertisers aren’t yet generally investing as much as they should be in the medium. However, as companies continue to grasp and appreciate how crucial a mobile strategy is in relation to wider marketing goals and objectives, this will gradually change. It is therefore very important for agencies to actively assist clients in making the move into this growing space.

The above headline on The Telegraph’s website caught my eye this morning.

It claims that 55% of 950 Londoners polled recently in research say they are unhappy about the internet coming to the tube. This news comes after London Underground announced on Wednesday that it has reached an agreement with Virgin Media, which will see a Wi-Fi service being introduced in 80 of the networks in 217 stations by the summer.

What are they unhappy with? 48% say they would be concerned about their privacy being compromised when browsing the web on the Underground, particularly when it came to submitting passwords.

Presumably these people aren’t the 55% of 16-34 year olds who use the internet on their mobile phones whilst out of home. Yes, privacy is consistently cited as a reason for not using mobile internet, but how often do people submit passwords when they use mobile internet on their mobile phones whilst out and about? Sure, many people may choose not to access their bank account on the Tube, but choosing not to use social networking, mobile search or entertainment? Research shows that 50% of 16-34s use Facebook or Twitter on the phones, and 47% browse for information. Privacy doesn’t seem to be an issue with these people.

The study also found that 31% thought it would lead to an increase in thefts on the tube – especially if people had their laptops and tablet computers on show at all times.

My guess is that people will be much more likely to use their smartphones to access mobile internet on the Tube. After all, three quarters of mobile internet users via their mobile phones already do so out of home. I can’t imagine many people on the Tube using their laptops, especially considering how difficult getting a seat can be. And in any case, people are already using their tablets to read and view content on the Underground which they have already downloaded to their devices. Of course theft is a concern even around smartphones, but people tend to be more careful than we think.

Actually, people aren’t going to get much of an opportunity to use their laptops on the Tube anyway. This is because Wi-Fi is only going to be available at stations. This makes the concerns of the 14% of people who were not in favour of Wi-Fi on the tube – because thought that people spending their whole journey using the internet would lead to ‘increased stress’ whilst travelling – redundant. In fact, I’ll bet that this very restriction will be people’s greatest complaint.

Sources: Mintel 2011, Ofcom 2011.