YouTube tripled ad sales on mobile devices in the past six months, generating an estimated $350 million in the last quarter alone, Bloomberg reported.
About a quarter of the Google-owned company's 1 billion global users access the service via mobile.
Because YouTube accounts for about 10 percent of Google's total revenue, and about 25 percent of users access the site via mobile, an analyst cited by Bloomberg estimates that 2 to 2.5 percent of Google's $14 billion in revenue in the first quarter of 2013 came from YouTube mobile ads. YouTube iOS and Android apps have included video ads since September 2012, according to The Guardian.
In an effort to shift marketers toward mobile ads, Google automatically splits advertisers' air time between the desktop and mobile versions of YouTube. Google offers TrueView video ads and OneChannel design to give marketers unified branding across all devices.
"The commercial business has exploded," Lucas Watson, YouTube's vp of sales, told Bloomberg. "It's a huge part of our business, and we know that's where it's headed."
A post on the Google AdWords Agency blog shows how Google is working to engage "Generation C," or the younger, Internet-connected generation.
"We found that the amount of time Gen C spends on watching YouTube on their smartphones is up 74 percent from last year," Google's advertising research director Gunnard Johnson said in the blog.
Google data shows that Gen C watches YouTube on multiple devices, often while doing other activities, including watching TV. This makes them "a hard-to-reach audience for brands," Johnson wrote.
Forrester Research analyst Julie Ask emphasized the importance of engagement in an interview with Bloomberg.
"People have less patience on the phone; consumers have become more task-oriented," Ask said. "The ads have to be entertaining and there's a higher bar to some extent."
According to Emarketer data, U.S. mobile ad sales are projected to exceed $2.69 billion by 2017.