LocalMobileSearch

Indoor Location Apps on the Rise for Retailers

In-store mapping provider aisle411 announced this week that its smartphone app is currently in use by more than 12,000 retail stores, including Walgreens, The Home Depot, Hy-Vee, Price Shoppoer, and Shop 'n Save, among others.

The mobile application provides directions to specific products and offers searchable store maps. Engaging consumers through in-store mobile apps holds considerable promise for retailers, says Nathan Pettyjohn, CEO of aisle411. "Offline Commerce, or purchases occurring at a physical store, make up approximately 90 percent of all retail purchases. aisle411's mobile platform digitizes the in-store shopping experience so that shoppers can find and buy everything that they came in the store to purchase."

Indeed a growing number of technology companies are offering in-store mapping and customer engagement platforms, collecting data about mobility patterns and giving customers information to make better point-of-purchase decisions. Don Dodge, Developer Advocate at Google helping developers build new applications on Google platforms and technologies, sees enormous opportunities in the future of indoor location technologies, saying it will be a huge market, "bigger than Maps or GPS".

Among the growing number of market entrants for indoor location technologies, beyond aisle411, include Wifarer, Meridian, Point Inside, VisibleBrands, Micello, and several others.

With Apple's recent acquisition of WiFiSlam for $20 million, the indoor positioning and indoor marketing industry is heating up. We'll be watching the market closely as retailers begin to embrace indoor marketing technologies and map the potential use cases going forward.

Can "Send Money" By Email Reinvigorate Google Wallet?

Yesterday at the Google developer conference, Google I/O, in San Francisco Google relatively quietly launched a new feature of Google Wallet -- send money by email. It represents, hands down, the simplest way to transfer money between people. And it could become wildly successful provided that Google promotes the service and explains how it works. 

It requires a Google Wallet account and an associated payment method (credit card, bank account). It doesn't require a Gmail account to send or receive. However it's easiest if there is a Gmail account. Gmail is the most popular webmail service now on a global basis. 

Google was reportedly going to announce a plastic payment card at I/O but that was scuttled at the last minute (apparently because of a poorly functioning demo for CEO Larry Page). Competitor PayPal offers a physical payment card for in-store usage, linked to PayPal payment methods (credit card, bank account). It's not clear how widely it's used. My suspicion is not at all.

Google's payment card was a renewed bid for relevance and adoption for Google Wallet. It may still launch after the "bugs are worked out." Its NFC-based mobile wallet has seen limited adoption and usage. And awareness of Google Wallet is well behind PayPal. 

Instead of the plastic card Google announced "send money." Essentially users just send money as they would an email attachment.  Users select the "attach money" icon in Gmail (not yet available but rolling out soon in the US to adults 18 and over), indicate the amount desired and the "from account" via a pull-down menu (credit card, bank account, Google Play balance). Then hit send. 

Sending money via email is currently only available on the PC. However users can send money from Google Wallet directly on their phones.

It's free for users to receive money. And it's free to send from your bank account. Sending a payment from a credit or debit card will trigger a 2.9% charge, just as if you had used your card in the "real world" at a point of sale. Google says it also offers "Purchase Protection ... against eligible unauthorized payments."

This is a pretty compelling way to send money, although there are a few adoption and potential trust issues that must be overcome. If Google can do that and educate people about the benefits it could become a huge success and make Google Wallet a hub for mobile payments vs. its current status as an "also-ran."

Millennial Media Q1: $49M, on Track for $230M+ in 2013

Millennial Media reported Q1 earnings yesterday afternoon. The company said that its revenue grew to $49.4 million from $32.9 million in Q1 2012. However the company saw a $3.8 million net income loss vs. a $4 million loss a year ago.

Non-US revenue was 18.4% vs. 12.1% in Q1 of 2012. Second quarter revenue guidance was $58 million to $60 million.

The company said that its network reached 420 million monthly unique users globally, including approximately 160 million monthly unique users in the United States. Millennial also said that its network was enabled on 42,000 mobile apps. 

CFO Michael Avon said on the earnings call that geotargeted, demographically and behaviorally targeted ads were "growing faster than the overall growth rate of the market." 

The company cited IDC's estimates that its mobile ad revenues in the US "were second only to Google." FY2012 revenues for Millennial Media were $177.7 million. However Facebook made $391 million in mobile ad revenue in 2012 and is on track to do nearly $1 billion this year. 

Directory publisher and local-mobile ad network provider YP said that it had $350 million in mobile ad revenue in 2012.

Mobile 'Economic Impact' Study Predicts $9.2B in US Mobile Ads by 2015

The Mobile Marketing Association, in connection with its latest conference, has released what it calls the "Mobile Marketing Economic Impact Study." Authored by Columbia University adjunct professors, it's a kind of soup-to-nuts document that includes mobile marketing forecasts as well as discussion of how many jobs are created by the mobile industry. The report makes a pitch for privacy self-regulation as well. 

The report asserts that mobile marketing "created 524,000 jobs in 2012." In calculating the economic impact of mobile and projecting mobile marketing spending it correctly sweeps much more broadly than mobile advertising alone. Accordingly the document predicts more than $30 billion in "mobile marketing expenditures" (defined broadly) will be spent by 2015 in the Us. 

Mobile Marketing Communications Spending in United States ($Millions)

Here's the MMA's explanation of its marketing categories in the chart above:

1. Mobile Media Advertising (“bought” media)
2. Mobile Direct Response (DR) Enhanced Non-Mobile Media, (also “bought” media)
3. Mobile Content and Relationship Marketing (mCRM) (“owned” and “earned” media)

Thus a roughly equal amount of mobile marketing spending occurs outside of the framework of "mobile advertising":

Within the overall mix of mobile marketing communications, Mobile Media Advertising will remain the largest single component of spending over the forecast period, reaching $9.2 billion by 2015. But expenditure on mobile marketing communications is not limited merely to advertising in on-device media. Expenditure on mobile direct response (DR) advertising or mobile enhancements within non-mobile media is projected to grow the fastest, growing over four fold from 2012 to 2015, to almost $3 billion; and mobile CRM will continue to be the second largest source of expenditure -- indeed, almost as significant as mobile advertising -- through 2015, when it is expected to reach $7.6 billion.

The forecast for mobile advertising by 2015 is $9.2 billion. Last year the IAB found that marketers had spent just under $3.4 billion on mobile advertising (the MMA figure is just over $3 billion for 2012). The $9.2 billion in the MMA report forecast is probably aggressive but perhaps still within reach. 

By Saying 'No' to Android Has Nokia CEO Elop Sealed His Fate?

There are some signs of progress for Windows Phones and Nokia's Lumia line of handsets that exclusively use the operating system. Especially in Italy and the UK Nokia seems to be making some headway. There were also some data showing an uptick in Windows Phones' market share in the US.

The following are two sets of survey-based market share data from comScore and Kantar. Kantar shows much greater growth in Windows Phone adoption in the US than comScore. Regardless, over the past 18 months Windows Phones have largely failed to make a dent in the smartphone dominance of Android and Apple devices. 

It's almost 100% certain that Nokia, with its well-reviewed Lumia hardware, would be selling more phones if there were an Android option. However Nokia CEO Stephen Elop has essentially refused to consider that option and is sticking to the company's Windows-only strategy. This comes amid intensifying investor pressure to adopt Android.

According to a recent WSJ article:  

Shareholders approved the dividend-suspension proposal, but appear to be losing patience as questions about Samsung and Apple loomed over Tuesday's session. One shareholder asked Mr. Elop why Samsung is achieving what the investor characterized as 10 times better results than Nokia, and another concluded a round of tough questions by saying that right now Nokia isn't displaying "the spirit and charisma" that Apple has.

Over the next 2 - 3 quarters, Nokia may see slightly better results but they won't show the kinds of growth desired by institutional investors. Unless or until Nokia adopts Android sales won't accelerate to any significant degree, to the increasing frustration of investors. 

One way or another Nokia will likely be developing Android devices by this time next year -- absent a Windows sales miracle. Either Elop will give in to investor calls for Android or, if he does not, he will be ousted by their calls for his head. And the first act of any successor CEO will be to fast-track Android handset development. 

The Sexy-Shocking Number from Nielsen's Mobile Path to Purchase Study

Earlier today xAd put out its quarterly insights report. There were a number of interesting findings and datapoints. The "headline" was that the number of national-advertiser campaigns using more precise geotargeting (more specific than DMA, city or ZIP) had more than doubled over the course of the past 12 months. 

In a very general way this mirrors the movement of the market and the growing sophistication and use of location targeting by marketers. 

There was also a nice case study involving Pinkberry's introduction of a new line of greek yogurt. Pinkberry's objective was to build awareness and drive visits to local stores. It used xAd enhanced geofencing to target users and show ads within 1 mile of store locations. The were a couple of discounts and incentives (coupons) associated with the product launch. 

The display ad clicked-through to a "dynamic landing page specific to the nearest location which features these offers as well as an option to save the coupon, obtain the address, phone number, map, directions and/or more information." According to the case study materials, in two weeks the campaign goals were exceeded by 2X. 

As you can see below, the ad creative was very polished. But the success of the campaign also illustrates how effective the combination of local relevance and offers can be. Indeed, xAd's reported average campaign metrics (for both search and display) outperform the industry averages. 

More interesting than the findings in the insights report were the findings released last week in the 2013 US Mobile Path-to-Purchase study, undertaken in cooperation with Telmetrics and Nielsen, which conducted the research.

The Mobile Path to Purchase study is in its second year. The findings are based on an online survey of 2,000 US smartphone and tablet owners and “observed consumer behaviors from Nielsen’s Smartphone Analytics Panel of 6,000 Apple and Android users.”

There were a ton of data that came out of this report, and will continue to be released over time. However the single "blockbuster" finding is that across a range of purchase categories (i.e., Finance, Retail, Insurance, Convenience/Gas) 46% of survey respondents said they relied exclusively on their mobile devices (smartphones and/or tablets) in conducting pre-purchase research online. 

Accordingly, nearly half of the respondents did not use or consult PCs -- at all. I was initially shocked by this. I don't have detailed demographic information about who these people were beyond the fact that they skew younger (18 - 34). But this is a huge finding and one that should scare the stuffing out of any brand or advertiser that isn't actively pursuing a mobile marketing strategy. 

Tablets to Dominate 'PC' Sales, Low End of Market Increasingly Cluttered

According to a new forecast by NPD, tablets and touch-screen laptops (tablet-PC hybrids) will dominate the computing landscape in the coming years. More conventional PCs will be in the minority. 

Tablets are a new device category really. But let's put aside the longer debate about whether or not tablets should be considered "PCs" at all. There will be more "mobile devices" than traditional PCs (including laptops) sold in the next five years.

At best forecasts can show the direction of the market. But in this case the market's direction is clear. 

Global Mobile PC Shipments, 2012-2017

Source: NPD

Last week Acer introduced a 7-inch tablet for $169, besting the aggressive pricing of Nexus 7 and comparable Kindle Fire devices. According to one rumor the next Nexus 7 will be priced at $149. But you can already buy a 7-inch Lenovo tablet for $129 on Amazon (quality is another question). The race is on for a "decent" Android tablet starting at $99. I suspect that will come in Q4 this year or very early next.

I was recently in Best Buy and Office Depot/Max and saw the displays of tablets; there are scores of them. It will be challenging for consumers to differentiate them -- especially at the lower end of the market. There will probably be three or four broad consumer criteria for tablets: OS/brand, price, size, specs like memory or battery life. 

With the exception of Kindle, Samsung and maybe one or two others the Android tablet universe is a sea of no-name devices. Here the battle will largely be about price. Apple iPads will stand apart because of strong brand identity. However a majority consumers will be price sensitive and likely to simply go after the cheapest "decent" (Android) tablet they find. Indeed, the devices are getting so cheap they're almost disposable. 

NPD says "Windows 8 are unlikely to be a major driver of touch adoption." I agree, as presently configured, Microsoft is unlikely to sell many stand-alone tablet devices. Surface Pro tablet-PC hybrids will sell to enterprise customers but Microsoft will struggle to sell basic tablets to consumers unless it reaches that $100 threshold first.

Tablets 'Shipment' Numbers Inconsistent with Traffic Reality

I'm a big opponent of using "shipments" as an indicator of market share. It may be a directional indicator of market share in some cases. But there are times when "shipments" is simply the wrong metric. IDC's latest tablet numbers offer a case-in-point.

The firm reported the following tablet shipment figures globally for Q1: 

• Android -- 56.5%
• iOS -- 39.6%
• Windows -- 3.3%
• Windows RT -- 0.4%
• Others -- 0.2%

Basically the positions of Android and iOS tablets have reversed since last year. Shipments are put forward as a proxy for market share by IDC. However that's a dubious proposition at best. Shipments do not equal sales, let alone usage.

The following chart reflects North American tablet traffic share as of March, according to Chitika. After the iPad's 82%, Kindle Fire has a 7% share of traffic. Samsung Galaxy tablets come in at 4.3%. Needless to say these actual traffic data show a massive discrepancy vs. IDC's shipments estimates.

Below is StatCounter data from 2012 (via Royal Pingdom) -- I was unable to find more recent global traffic data. These data reflect something very consistent with the Chitika data above.

In these various geographic markets the iPad is generating around 80% or more of tablet traffic. Even if we assume iPad share has fallen by 10 points since last year, these data are still a radical departure from the IDC figures. 

Undoubtedly lower-priced tablets and the sheer proliferation of devices will necessarily diminish the iPad's "shipments share" over time. But it remains to be seen how actual usage is impacted. For the moment market share (as measured by consumer usage and traffic data) looks nothing at all like IDC's projections.