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BIAKelsey-Mobile-Local-Ad-Spend-by-Format-2012-2017-Apr2013Search dominates mobile local ad spend to the tune of 58% share of revenues ($704 million of $1.22 billion in 2012), per the latest mobile local ad spend forecast from BIA/Kelsey. That compares with 31% share for display, 8% share for SMS, and just 3% for video. But that picture should change quite dramatically by 2017, particularly when looking at the share of revenues accounted for by video.

Indeed, BIA/Kelsey expects video revenues to reach $515 million in 2017, more than 13 times the $38 million registered last year. That dramatic climb will begin this year, with video revenues projected to more than double to $83 million.

By 2017, then video will account for almost double last year’s share of mobile local ad spend, at 5.7%. Display’s share of revenues will remain relatively stable over the years, forecast to be at roughly 30% in 2017. The big loser will be SMS, with revenues only expected to increase from $101 million last year to $162 million in 2017. SMS’s share of the mobile local ad spend market will drop from last year’s 8% to less than 2%.

Meanwhile, search will continue to dominate mobile local ad spending in 2017, at a projected 62% share. Almost 86 million people use their mobile phones last year to seek local business information in the US, according to results from the recently-issued Neustar Localeze and 15miles Sixth Annual comScore Local Search Usage Study.

Meanwhile, the other shift that will take place in mobile ad spend over the next few years will concern location versus non-location targeted spend, per the BIA/Kelsey study. While location-targeted spend accounted for 38% of total mobile ad spend last year, that should grow to 54% share in 2017 as local mobile ad spend growth outpaces national spending in mobile.

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