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'Tough year ahead' for mobile ad platforms

Updated: 2013-10-18 08:08
By Gao Yuan ( China Daily)

United States-based industry consultancy IDC has estimated that China's smartphone population will grow by 450 million next year. Most of those gadgets will have Web access and offer online ads.

Tan Guangzhu, a researcher at CNNIC, said local platforms have yet to develop a mature business model. "With the smartphone penetration rate continuing to grow, mobile devices will prove to be a golden advertising vehicle," said Tan.

Researchers also suggest advertising platforms should devote more energy to exploring demand from more vertical industries, which would boost their profits in the long run.

Current big spenders in the sector are telecom operators and handset makers, said Woolfrey, adding that vehicle manufacturers and finance institutes are spending more.

Many more vertical industries will be willing to advertise on mobile devices because videos and rich media Web pages will give audiences a more comprehensive way of understanding a product, he said.

Ads on smartphones in the future will be colorful, rich and watched repeatedly, he added.

Message-based ads, which are going out of fashion, contribute more than half of agencies' revenues.

"Given the size of the addressable market, the engagement of the audience,and the widespread availability of speedy mobile connections, it is no surprise that advertisers have finally had to step up," said eMarketer.

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