Verve: Local Mobile Spend Grew 82% YoY

Verve Wireless is a San Diego CA-based mobile ad network consisting of approximately 1200 local media sites (mostly newspapers). The company's network features both small business and national-local advertisers; and it has created and released the first of what will apparently be quarterly reports focused on local-mobile advertising and consumer behavior.

Verve is calling the quarterly report the "Local Mobile Index" (LMI). The ad inventory measured is all mobile display. Verve says the data presented in its inaugural report are a mix of "Omniture, comScore and Verve reporting." The data can be compared to what Millennial Media is doing with its SMART reports but at a purely local level.

As with all such network-based data the Verve report must be seen as a reflection of what's happening on the company's own network primarily. However it's large enough that these data are going to be directionally reflective of larger trends in the local-mobile market.

Top ad verticals

Top five local-mobile ad verticals on the Verve network (Q1 2011):

  • Autos
  • Real estate
  • Entertainment
  • Banking 
  • Health care

Compare Millennial Media's top 10 verticals by ad spend for Q1:

  1. Retail & Restaurants
  2. Telecommunications
  3. Portals & Directories
  4. Finance
  5. Automotive
  6. Entertainment
  7. Dating
  8. Education
  9. Travel
  10. CPG

Spending growth

According to Verve the local ad spend grew 82% year over year (Q1 2010 to Q1 2011) for the identical inventory in its network. This growth rate is in line or somewhat higher than general mobile spending growth. For example, here are eMarketer's mobile ad growth projections:

In the table immediately above, eMarketer said that mobile display grew 122% in 2010 but will slow to 65% annual growth in 2011. I believe it's too soon to argue that mobile ad growth will slow, however, and believe these figures are somewhat conservative. 

Dayparting

About 56% of page views on Verve's network occurred during the afternoon commute hours and in the evening (between 7-10pm). The chart below reflects mobile usage throughout the week.

Screen shot 2011-06-27 at 4.14.04 AM

These data seem to contradict other mobile data that show weekends as a time of heavy mobile activity. However this might be explained by the fact that most of Verve's sites are newspaper sites and that consumption of these sites may decline on the weekend. 

Ad performance

Verve said that in-app ads outperformed mobile web ads "by a factor of nearly 3x (2.67)" during Q1 2011. This is not a surprise given higher levels of consumer engagement with apps vs. the mobile web.

In addition, according to Verve, "rich media campaigns out performed standard banner programs, as measured by consumer engagement, by a factor of 7:1." However some rich media ads that launched video from the banner "performed worse than those without video or had video embedded in a landing page (1.61% video banners vs. 2.67% video embedded), which may indicate some reticence on the part of consumers to go straight into video without an intermediate step." 

Top cities

Perhaps the most interesting data from Verve's report is the list of top DMAs by ad revenue. Here they are and they feature some surprises: 

  1. St. Louis
  2. Houston
  3. New York 
  4. San Francisco  
  5. Portland
  6. Denver
  7. Memphis
  8. Seattle
  9. Dallas
  10. Cleveland-Akron

Texas is the top state by ad revenue in Verve's network. 

Here's a situation where the data from Verve's network may diverge significantly from larger trends in the market. It's very unlikely, for example, that St. Louis is the top overall DMA for mobile ad revenue in the US. What's more plausible is that the sales reps in that market have had great success selling mobile to their advertisers (Verve does some national ad sales). 

iPhone vs. Android

The iPhone represented nearly half of all traffic on Verve's network. However the company said that Android users were more engaged. Verve doesn't elaborate on the meaning of this statement in its report but says that "Android achieved 52% better engagement results during the quarter." 

Screen shot 2011-06-27 at 4.35.09 AM

It's also interesting that BlackBerry had nearly as much share as Android on Verve's network. This is probably a reflect of the legacy of numerous RIM devices in the market.

There hasn't been much good local-mobile ad spending data in the market prior to this. So it will be great to see these quarterly reports and assess how the market is doing based on "facts on the ground." Most of the forecasts (though not all) about local-mobile released to date have been based on very high-level data and often incorrect assumptions about the market.