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Advertisers in Japan will spend more than ¥454.2 billion ($3.75 billion) on total smartphone ads in 2016. Research by CyberZ indicates that this is up significantly from 2015’s total of ¥371.7 billion ($3.07 billion), and that, in 2017, spending is set to grow solidly once more.
Smartphone display advertising, already with the highest spend of any smartphone advertising format or type, will continue its dominance in the years to come, growing from ¥289.3 billion ($2.39 billion) in 2016 to ¥355.8 billion ($2.94 billion) in 2017, and ultimately to ¥520.6 billion ($4.30 billion) in 2020.
Search advertising spend will also grow over the next few years, despite a lower total spend than display advertising. From ¥155.9 billion ($1.29 billion) In 2016, spending will rise to ¥173.1 billion ($1.43 billion) in 2017 and ¥224.1 billion ($1.85 billion) in 2020.
Another area of increased ad spending in Japan is mobile app re-engagement advertising, that is, advertising aimed at existing users who have downloaded or installed the app with the purpose of encouraging further engagement.
Advertisers are set to spend ¥6.9 billion ($57.0 million) on just such ads in 2016; in 2017, CyberZ estimates they’ll spend ¥13.5 billion ($111.5 million). By 2020, spending is projected to reach ¥35.0 billion ($289.1 million).
Smartphone users made up 40.8% of the population in Japan last year, eMarketer estimates. In 2016 they’ll make up just under 45%, and by 2020 over 50% of population in Japan will be smartphone users.
Data from Nyle in April 2016 reveals that 9% of youth and young adult smartphone users in Japan download apps almost day, with another 11% saying they use them once every two to three days, which means that if app re-engagement is the goal of advertisers, they have a long row to hoe.
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