U.K. Mobile Advertisers Up 45 Percent

U.K. marketers continue to persevere with mobile display ads, despite challenging economic conditions and shrinking ad budgets.

ComScore’s M:Metrics mobile arm reports a notable increase in U.K. advertisers running mobile banner campaigns since October 2008. According to ComScore analyst Alistair Hill, 45 percent more advertisers ran banner campaigns in the six-month period ending March 2009, compared to the six months prior, bringing the total number of individual mobile advertisers to 195.

“It’s a nice upward movement. The majority of campaigns are still run on a trial basis, but we’re starting to see repeat buys,” said Hill, citing campaigns from advertisers such as Adidas, BMW, and Ford. In addition, he suggested firms outside of the mobile and automotive verticals, which typically account for the vast majority of mobile spend, were beginning to expirement more with the medium. Nestle, for example, is currently running ads for its KitKat chocolate brand.

Mick Rigby, chairman of mobile-focused media agency Yodel Digital told ClickZ News the downturn is having little effect on his company’s business. “Honestly, we haven’t been busier than we are at the moment. Every couple of days we’re getting requests from new clients,” he said.

However, more advertisers don’t neccessarily equate to greater spend. “We’re seeing an increase in the amount of people spending, but budgets remain relatively small. For brand agencies, it’s still an unknown quantity, and because of the nature of the economy, they’ll tend to go with what they know will deliver return on investment,” Rigby added.

Si Crowhurst, founder and managing partner of full service mobile agency We Love Mobile, agreed that spend is still growing, but at a slowing pace. Compared with falling ad spend across the majority of other channels however, any growth is surely a positive. Crowhurst said the withdrawal of budget from automotive players that invested heavily in ’08 has hurt. Yet, he noted, adult, gambling, and mobile commerce spending remains strong.

Surprisingly, both Hill and Rigby suggested that financial services advertisers are beginning to return to the medium. “Finance was growing until it dropped off in August last year, but we’re starting to see them dipping their toes in the water again,” Rigby said. According to Hill’s ComScore data, advertisers such as RBS have been running campaigns recently.

In relation to serious growth of the mobile medium, it appears the iPhone is playing an important educational and catalytic role. “The iPhone effect is great news for the business. For the first time, it’s put the mobile platform in front of serious decision makers,” said Rigby. “Applications will also continue to be big business and provide revenue opportunities, and not just on the iPhone,” he added.

However, mobile growth probably won’t reach a tipping point until highly Web-capable handsets are more widely adopted. One benefit for the U.K. market, however, is the fact that users commonly recieve handset upgrades when they renew their service contracts, potentially driving smartphone uptake.

UPDATE: This story originally implied that the additional 45 percent of U.K. mobile advertisers represented 195 firms, when in actuality the total number of U.K. mobile advertisers rose to 195 in the period measured.