A new study from Juniper Research has found that advertising spend on smartwatches will reach $68.6 million by 2019, up from an estimated $1.5 million this year.
The research – Digital Advertising: Online, Mobile & Wearables 2014-2019 – found that growth will be fuelled by the entrance of high profile brands such as Apple into the smartwatch arena, allied to increased consumer affinity with and acceptance of wearable technology. It argued that the emergence of an additional consumer screen would stimulate interest amongst advertisers, although until a critical user base is reached most ad-spend is likely to take the form of ad hoc campaigns.
New advertising formats for smartwatches
However, the research notes that brands will need to devise and implement new advertising formats designed to cater for the limited real estate on a smartwatch screen.
Additionally, it observed that behavioural differences between smartphone and smartwatch usage are likely to provide a further challenge. With consumers viewing smartwatch screens for seconds rather than minutes, advertisers will have markedly less time to engage their audience.
Programmatic advertising to lead
Meanwhile, the report also suggests that programmatic (real-time bidding) advertising is one of the main drivers within the wider digital advertising sphere. Programmatic advertising has evolved over the last couple of years from low levels of implementation to becoming an integral cog in the system.
All types of advertising formats are now being traded between advertisers and publishers in the ad exchange markets, where it used to be a place where only the excess or remnant publisher inventory was sold.
Other findings from the report include:
- Native advertising formats are becoming popular due to their ability to mimic the look and feel of the webpage.
- An evolving array of entities are involved in the digital advertising value network and the complexity is increasing as more technological advances come into the fore.
- Rich Media advertisements are becoming increasingly prevalent, particularly with regards to in-app advertising.
The whitepaper, Digital Advertising Gets Personal, is available to download from the Juniper Research website together with further details of the full report.
Juniper Research provides research and analytical services to the global hi-tech communications sector, providing consultancy, analyst reports and industry commentary.