The amount of money spent on mobile ads with a local focus will grow from $784 million last year to $5.01 billion in 2016, a 539% leap and an annual growth rate of 45%, according to a new forecast.
Studies have shown that most searchers on mobile devices have local intent, meaning they are looking for something—a store, a restaurant, a product, a local sale or deal—near to where they are at the moment. Mobile local paid search ads, for example, can drive a frenzied consumer in a snowstorm to an m-commerce site where he can quickly find the nearest location of a hardware store chain to purchase a snow blower.
The firm segments mobile local ads into four distinct formats: search, display, text messages and video. Search is growing the fastest and is the biggest driver of growth in mobile local advertising, the study says, in part because mobile paid search ads perform better than the other formats.