Leading mobile advertising company MoPub announced today that the mobile ad spend being transacted through its real-time exchange MoPub Marketplace has hit a $100MM annual run rate this month. This milestone underscores the arrival of real-time bidding in the mobile app ecosystem as a potent market force. Since Q4, their revenue has tripled and now nearly 20% of the nearly two billion ads served per day on the platform are transacted through RTB.
“Increasingly, we’ve seen advertisers shift to real-time bidding, because it provides more transparency and access to ad inventory than the traditional ad network approach. This shift of ad dollars combined with better advertiser ROI has created a tremendous upsurge in demand,” said Jim Payne, CEO of MoPub. “We couldn’t have imagined when we launched our Marketplace 18 months ago that we would have a $100M revenue business so quickly thereafter.”
Industry observers have called this the “third wave” of mobile advertising. The first wave was characterized by walled gardens, followed by a second stage that took the form of ad networks like AdMob, Quattro (now iAd) and Millennial (now a public company). However, the trend of desktop display advertising towards programmatic has picked up pace as advertisers have increasingly been able to generate better returns from transparent, tradeable formats than alternatives. These trends are happening on mobile even more quickly.
A large driver of this business has been the increased advertiser interest in app install ads, which contributed “real revenue” to Facebook’s top line in their last quarter, according to Mark Zuckerberg. These install ads are succeeding not only on Facebook but as advertisers see success with them, they want to be able to cost-effectively access ad inventory outside of Facebook too. Real-time bidding and ad exchanges like MoPub are a powerful way to get even more distribution.
“Mobile moves 3X faster than desktop does, across almost any dimension you look at, but particularly in the maturation of the advertising ecosystem,” said Jim Payne. “We are nowhere near done though – from native formats to interstitials to mobile video – none of these great ad products are yet at scale. We expect that programmatic trading will be the mechanism to popularize each of them.”