As of the beginning of this year, mobile held 10% of US consumers' media time, but held only 1% of total online ad revenue (BIA Kelsey).
Part of the reason was that Google Adwords -- the largest purveyor of online advertisements -- originally required advertisers to create a different campaign for each parameter they wished to bid for, such as time of day, location, and type of device.
This resulted in a few advertisers running hundreds or thousands of concurrent campaigns in order to reach both online and mobile customers. Many advertisers chose not to bother creating multiple campaigns just to target the mobile marketplace. As such, there was a low demand for mobile ad inventory as compared to online ads.
In response to this disparity, Google has released an upgrade titled Enhanced Campaigns. Enhanced Campaigns are intended to simplify how advertisers target their campaigns and bid on keywords. By making it easier for advertisers to adjust their ad campaigns, Google intends to increase advertiser participation in mobile marketing through Adwords.
- Advertisers can adjust their bids by device, location, and time of day, all within a single campaign. It is expected that, should Google include anonymized user data in the future, advertisers will be able to target their ads even more narrowly, such as by age.
- Ads can be automatically varied depending on what type of device the search originated from. Advertisers can then show the most relevant ads to a potential customer, based on location and device data (be aware that tablets have been lumped in the same bucket as computers, much to the chagrin of many advertisers).
- New metrics enable advertisers to measure the impact of their ads. They can now track calls and app downloads from their ads, with more metrics expected to roll out soon.
AdWords with the New Campaign
Now that it is an automatic component of Adwords campaigns, more advertisers will bid on and purchase ads for mobile, decreasing the current disparity between mobile usage and mobile ad revenue. Mobile ads are currently 15% cheaper than online ads; greater participation and demand will increase the prices of mobile ads to rates comparable with online ads.
Some larger advertisers -- those who maintained many varied campaigns according to specific parameters -- will find that the change affords them less freedom in how they customize their campaigns. However, that same change opens up mobile ads to small- to mid-sized advertisers that previously did not have the resources to run multiple campaigns simultaneously.
Enhanced Campaigns are intended to provide advertisers with more flexibility in how they manage their campaigns. It also enables them to better measure their campaign metrics. The upgrade to Enhanced Campaigns will be available to advertisers in February; all advertisers will be automatically upgraded to enhanced campaigns in June. As a result of the change to enhanced campaigns and projected increase in mobile ad spending, Google revenues are expected to increase from $1.86 billion to $3.6 billion in 2013.