Time on Mobile Skyrockets, Brand Budgets Still Lag Behind
By Arthur Noort
We love our mobile devices, that’s no secret to anyone. One survey even showed that a whopping 85% of people consider their mobile device to play a central part in everyday life. This is a huge number, especially considering we’ve only been sporting smartphones in mass numbers since the late 2000s. However, comparing time spent on mobile and advertising budgets shows an enormous discrepancy: while time spent on mobile is now more than TV, only 8% of budgets go to mobile vs. 70-80% for TV.
Mobile surpasses TV
Time spent on mobile is now 2 hours and 57 minutes compared to 2 hours and 48 minutes on television according to the Bureau of Labor. In the last two years, mobile has added an hour to screen consumption; meanwhile television has sat stagnant with little growth. Consumers 18-24 in the United States spend significantly more time on their smartphones compared to consumers over the age of 25, reporting 5.2 hours per day for young Millennials. This generation, also known as “cord-cutters” and even “cord-nevers”, are ditching cable TV and consume media primarily “over-the-top” (OTT) on their computers, tablets, and phones.
What are we looking at?
So we discussed consuming media is done en-masse, accounting for almost one fifth of time spent, but what more are people doing on their mobile devices? How are Millennials filling 5 hours and 12 minutes per day looking at those tiny screens? Over 85% is spent in-app, meaning the mobile web only takes a meager 15%. Among these apps, there’s an 800 pound gorilla called Facebook that takes 19% of all time spent. Needless to say, social media (28%) and messaging (12%) are important drivers of the growth of time spent on mobile. Also, games are widely popular, clocking in 15% of time spent. Utilities and productivity apps follow with 8% and 4% respectively.
It’s safe to say that trying to reach Millennials on TV is an uphill battle. 24% of them do not watch traditional TV whatsoever and the rest shows the lowest average amount of hours compared to any other age group. No wonder if you already spend over 5 hours on a mobile device per day.
The opportunity surely lies with mobile here, yet brands are still catching up. Mobile has been maturing among consumers for a while now as indicated by the finding that 85% consider mobile to play a central part in their life. However, industries usually take much longer to adopt new technologies than consumers and brand advertisers are no exception. Sure, there are technical difficulties considering targeting, viewability, and attribution but these make the payoff all the better. Location, context, and unprecedented audience segmentation data will make mobile the most effective advertising medium ever. The Mobile Marketers Association calculated the value first-movers to mobile can seize at the SM2 conference during Advertising Week and found a $3.9 billion opportunity. The question is, who’s going to take it?
The key will be to understand how consumers move through different touch points on their purchasing journeys. Using several devices throughout the day and even at once is a given among consumers, it’s up to the advertising industry to follow. Given the massive discrepancy between ad spend and time spent on mobile, it’s expected that advertisers will reallocate TV dollars to mobile, especially mobile video. It’s just a matter of time before a new balance is found, in turn, ready to be disrupted by the next big thing.