Consumer-packaged goods' mobile ad revenue started from a small base to rise 235% on Millennial Media's ad network last year, but landed in sixth place behind other verticals, per Millennial and comScore. CPG companies are reaching out to a mobile audience of 85 million, with a skew toward 25-to-54 year-old women, but with more men using mobile to shop for groceries.
Research firm eMarketer projects consumer packaged goods firms will spend $470 million in online marketing this year, up 17% from 2005. While some of the spending will go to advertising buys, eMarketer anticipates greater returns for CPG companies in building their own branded sites to encourage relationships with consumers.
Many may still view online advertising space as best suited for direct response needs, and consumer packaged goods firms only account for one-third of online advertising revenue, according to recent research. PepsiCo spent the most of all CPG firms covered by the survey, yet only allocated 3.4% of its advertising budget on Internet expenses. Industry groups are working to convince other CPG firms of the value of online advertising.