Why online is the next big frontier for advertisers

More than 90 per cent of Internet connections in Kenya are recorded on mobile devices hence the allure by more advertising firms. [Photo: Courtesy]
If you are looking to have your product or service reach the largest number of prospective customers, you should start thinking less of billboards and TVs but more of smartphones.

The increased popularity of smartphones and falling data prices have seen consumers stay on their handheld devices longer. And more businesses globally are beginning to take notice.

Mobile advertising is now widely considered as the next frontier for advertising. Technology companies and advertisers are exploring new methods to make the most from ‘smaller screens.’

The annual IAB Internet advertising report from the trade group Interactive Advertising Bureau and consulting house PWC paints a rocketing trajectory for the growth of mobile advertising worldwide.

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The report that tracks digital ad revenue found that digital ad spend in the US has risen by an average of 15 per cent in the last ten years from Sh2.3 trillion ($23 billion) in 2008 to $40 billion Sh 400 trillion (Sh4 trillion) in 2017. 

Mobile advertising on the other hand has grown by 77 per cent since 2012, alone and now commands more than half of every dollar spent on digital advertising. These figures apply to the US market where smartphone and Internet penetration as well as market differentiation is more pronounced than in sub-Saharan Africa.

However, recent trends in the market and investments by technology companies indicate that the situation might not be different in Kenya. Most consumers have gone mobile as brands follow suit. “Internet use has grown significantly in Kenya from 45 per cent in 2014 to 53 per cent last year,” said Google Country Manager Charles Murito.

More than 90 per cent of Internet connections in Kenya are recorded on mobile devices, and affordable brands steadily pushing up Kenya’s smartphone penetration rate to 40 per cent.

This is higher than the sub-Saharan average of 30 per cent, and has seen more Kenyan users rely on their mobile devices for their basic Internet needs. 

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According to data from Google, Nigeria and Kenya lead the world in the share of searches made through smartphones. The share of Kenyans making search queries on Google through their mobile phones rose from 74 per cent in the fourth quarter of 2016 to 81 per cent in a similar period last year. “We’ve seen searches for terms like “same-day shipping” and “open now” increase twice and thrice respectively while travel searches for “today” and “tonight” have risen by 150 per cent,” said Murito.

Nearly all of these searches happen on mobile phones with mobile searches of “where to buy” increasing 140 per cent over the past year in Kenya.

Similar spikes in usage have also been reported on other platforms and applications. On YouTube, fast becoming a leading platform for companies to host and broadcast their brand information, growth in watch-time among Kenyan audiences has grown by more than 110 per cent in the past 12 months.

This points to a market that is finally getting the masses on board to convince tech companies to build platforms that make it easier for brands to advertise on mobile. Call listing app Truecaller last week officially opened its African headquarters in Nairobi with the company validating the strategic importance of Kenya as a market for mobile advertising. “We have about six million users in Kenya and this is our largest market in Africa which is why we opted for the country as our regional headquarters,” explained TruCaller’s director for partnerships, Africa Zakaria Hersi.

With a growth of about 35 per cent annually, TruCaller says the number of new users in Kenya increases by between 5,000 and 10,000 daily.

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The growth is expected to surge as more consumers adopt smartphones. “Our approach for the market is to build on partnerships for mobile advertising which we have seen work well in India where we started off,” explained Hersi.

One of the company’s services launched for Kenyan companies last week is called TrueCaller Priority.

The service allows providers such as e-commerce companies and emergency services give branded notifications on calls - avoiding scammers. Mr Hersi they are developing ads that can be viewed by users who lack smartphones.

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