Mobile Users Are More Likely to Click on Mobile Ads When They’re Closer to the Business

When a mobile ad hits the screen of a consumer’s smartphone, does their proximity to the business placing the ad matter? The answer is a resounding “yes,” according to YP’s “Local Insights Digital Report: Q3 2012.” The report found that clicks on mobile ads for a business are more likely when the mobile user is physically closer to the business’s location.

According to the report, which aggregated data from more than 1.5 billion monthly geo-targeted ad impressions on YP’s Local Mobile Display Network, click-through rates (CTRs) for mobile ads presented to users 5-10 miles from the business itself are 5 percent higher than when the user is 10+ miles from the business. CTRs are 26 percent higher when a user is 2-5 miles away from the business, 48 percent higher when the user is 1-2 miles from the business and 40 percent higher when the user is less than a mile from the business.

CTRs for in-app ads on iOS devices were nearly 47 percent higher than CTR for in-app ads on Android devices. Mobile ads on the iPhone 5 will have more real estate to work with, thanks to the bigger screen. It will be interesting to see how mobile marketers take advantage of this, whether by simply producing larger ads or doing something else.

According to YP, health care and fitness was the app and mobile website category that saw the highest CTR in the third quarter, followed by reference and multimedia.

The report also listed the top 10 individual mobile search categories:

1) restaurants
2) financial services
3) beauty services
4) auto repair and services
5) real estate
6) physicians and surgeons
7) auto parts
8) building contractors
9) legal services
10) materials, equipment and supplies

The fastest-growing local search categories during the third quarter were pool and spa services (+86 percent), boats and boating (+ 80 percent) and outdoor recreation (+76 percent). This makes sense, given the warmer summer months this report is focusing on.

Building contractors were the top local ad spenders in the third quarter, according to YP. Legal services, dentists, physicians and surgeons, and auto repair and service followed.

In the realm of social networks, eMarketer recently projected that Twitter will claim 5.0 percent of U.S. mobile ad revenue this year, ahead of the likes of Apple (iAd) and Facebook.