The landscape of car navigation systems is undergoing a significant transformation, with advertising playing an increasingly pivotal role. This article delves into the nuances of pushpin advertising, its impact on the industry, and the future of navigation-based advertising.
Car navigation systems are evolving, with pushpin advertising becoming a key revenue driver. This article explores how traditional POI labels are being replaced by more sophisticated advertising methods, the financial impact on companies like NavInfo and AutoNavi, and the future of mobile and location-based services in the navigation industry. Discover the stats and trends that are shaping this dynamic field.
Pushpin advertising is revolutionizing the way ads are integrated into car navigation systems. Unlike traditional Points of Interest (POI) labels, which had limited commercial value, pushpin ads offer a more in-depth and targeted approach. According to Wu, a key figure in the industry, the focus is on leveraging strong database technology and massive data processing capabilities to understand user needs and deliver relevant ads at the right time.
The financial implications of this shift are significant. For instance, vertical field advertising revenue now accounts for one-third of NavInfo's total revenue and could rise to about half. This is a substantial increase, considering that traditional POI labels did not play a major role in revenue generation.
Banner advertising has faced challenges due to varying interests and the need for more targeted information. However, NavInfo is more concerned with the attributes of advertising messages rather than the advertised property itself. This approach has led to a higher acceptance rate among advertisers.
NavInfo, listed on the Shenzhen Stock Exchange, reported an operating income of 867 million yuan in 2011. The car navigation business contributed 373 million yuan, while the consumer electronics navigation business brought in 379 million yuan. However, the latter heavily relies on bulk purchases from Nokia NAVTEQ. Diversifying revenue sources and increasing consumer electronics customers are crucial for NavInfo's growth.
AutoNavi, listed on NASDAQ, reported a net income of $127 million in 2011, nearly a 50% increase from the previous year. Net profit also doubled to $36.5 million. Mobile and Internet location-based services grew steadily, contributing to 27.38% of the company's total revenue by the fourth quarter of 2011. As of mid-March 2012, AutoNavi's mobile user base exceeded 50 million, with over 30 million navigation dog users.
The mobile Internet and location-based services are the future of the navigation industry. Although NavInfo is still in the research stage, this direction is inevitable for any vendor in the industry. The company focuses on underlying data and services platforms, but the rapid growth of the mobile Internet is a significant factor to consider.
Map data vendors are increasingly involved in mobile advertising. Companies like AutoNavi are developing offline maps and mobile phone navigation applications with embedded advertising. According to Yinxing Long, an analyst at Analysys International, mobile map advertising is still in its prototype stage but shows high growth potential. This trend could lead to advertising revenue surpassing map license revenue for map data vendors.
The evolution of advertising in car navigation systems is reshaping the industry. Pushpin advertising offers a more targeted and effective approach compared to traditional POI labels. Companies like NavInfo and AutoNavi are leading the way, leveraging mobile and location-based services to drive revenue growth. As the industry continues to evolve, the potential for advertising revenue to surpass traditional map license revenue is becoming increasingly likely.
This article provides a comprehensive overview of the current state and future trends in car navigation advertising. For more detailed insights, refer to authoritative sources like AutoNavi and NavInfo.
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