Waze Picks xAd to Deliver Location-Based Ads to Navigation App

Social navigation app Waze and xAd announced a partnership at Mobile World Congress in Barcelona today. Waze intends to deliver ads to users "along [the] designated navigation path." The company is not the first to try and do this; Mapquest initiated something similar with national advertisers a couple of years ago but in an incomplete way. 

Waze has a very engaged audience and has benefitted from the initial stumbles and challenges of Apple Maps. It was one of the alternative mapping and navigation apps recommended by Apple. Telenav also mixes location-based ads and navigation in an app. 

According to the press release this morning:  

Through the use of xAd’s proprietary technology, ads can be further targeted based on context factors such as past anonymous search behaviors while leveraging the unique functionality of Waze to serve ads at the most relevant time along their route – when the consumer is likely to see and engage with the offer…. at zero speed. 

In addition to its own social data, Waze integrates social and location-specific content from Yelp, Foursquare, Facebook and YP into its app. Users can choose results from any of these sources when they conduct a local search via Waze.

According to the press statement xAd will be the exclusive provider of both search and display ads in Waze. I was unable to find any example ads this morning in the app. I'm sure the integration will be thoughtful however. Waze recognizes the need to preserve the integrity of the user experience. Too many or irrelevant ads would risk alienating its audience.   

Report: Mobile Now More than One Third of Digital Media Time

Metrics firm comScore is out with a couple of "Digital Future in Focus" reports. They collect the company's data from 2012 into a narrative about marketplace trends. In terms of mobile much of what's in there is familiar: smartphone penetration crossing 50%, tablet ownership growth, Android growth, the rise of apps and so on.

One stat, however, that caught my eye is in the graphic to the right: 37% of digital media time is now spent on smartphones and tablets. By contrast 63% is on the PC. This one data point shows how dramatic the shift to mobile/personal devices has been, in a relatively brief time frame. Most marketers have not fully caught up however.

Top 25 sites

Another interesting chart (above), previously released, is comScore's Top 25 digital properties. It shows PC vs. mobile usage (uniques) for the top sites, as well as the incremental lift provided by the mobile audience. The table also reflects substantial overlapping usage. However in selected cases (i.e., Pandora, Weather.com) there's a major boost in audience via mobile. 

In the report comScore also documents the erosion of PC usage in select "mobile centric" categories. In other words, there's a shift to mobile usage for some part of the audience: 

We have begun to see a marked shift in usage patterns on the traditional desktop-based web. While most mobile content usage remains incremental to existing web behavior, certain content categories particularly well-oriented to mobile usage have witnessed material softness in top-line usage from desktop computers. Over the past two years, categories such as Newspapers (down 5 percent), Maps (down 2 percent), Weather (down 12 percent), Directories (down 23 percent), Comparison Shopping (down 4 percent) and Instant Messengers (down 52 percent) have seen declines despite a 5-percent increase in the total U.S. internet population over that time.

Again the categories that have seen some or substantial migration to mobile: 

  • Instant messengers (PC traffic is down 52% YoY)
  • Directories (23%) -- this category isn't fully defined in the document
  • Weather (12%)
  • Newspapers (5%)
  • Maps (2%)
  • Comparison Shopping (4%)

Opera Buys Skyfire for $155 Million But Is It Already 'Game Over'?

Browser-maker Opera announced that it's buying much smaller rival Skyfire for approximately $155 million in cash and stock. Skyfire's chief claim to fame is video optimization. Opera also said this week that it was approaching 300 million monthly users across all its platforms (computers, mobile phones, TVs and other connected devices).

The 300 million monthly uniques figure is very impressive; however it masks a downward trend in Opera's usage in mobile. As Android and iPhones push out feature phones (except in developing markets) and BlackBerry devices, Opera is seeing its global browsing share decline.

According to current StatCounter data the company's position is deteriorating.

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In the course of a single year Opera has gone from being the leading mobile browser around the world, with a 23% share, to number three and a 15% share. This rapid deterioration probably explains the company's recent decision to switch the core of its browser to WebKit as well as the Skyfire acquisition. 

WebKit is behind both Safari and Chrome, though not IE. Opera's adoption of WebKit will enable its browser to remain relevant in a smartphone world dominated by iOS and Android.

Opera's business, since its 2010 acquisition of AdMarvel, also includes mobile advertising. And in its recent Q4 State of the Mobile Web report, intended to showcase the company's global scale and advertising chops, we discover that 64% of global ad impressions are still coming mostly from the US, though international is growing.

Revenue Graphic

In the US Opera holds a less than 1% mobile browser market share according to StatCounter. In Europe it's roughly 7%. In Asia it's 24% but Opera was just passed by the Android browser. Africa is the only region where Opera continues to lead.

However Android's global growth is a direct threat to the company given that most users will rely on the device's own browser or Chrome. By the same token most users on the iPhone rely on Safari. Currently Opera has little to offer that will clearly differentiate it from either the Android or iPhone browsers. That's partly what the Skyfire bet is about -- mobile video optimization.

However by itself that's not going to be enough to keep Opera from continuing to lose usage.

Survey: Users Look to Mobile Websites for in-Store Customer Service

Earlier this week ForeSee Results, which measures online consumer satisfaction, released a new "Mobile Satisfaction Index." Based on a survey of 6,000 US adults in Q4 2012 the company sought to rank retail mobile sites and apps. Amazon was the winner, followed by Apple.  

Below is ForeSee's list of top 25 ranked retailers and e-tailers according to consumer mobile satisfaction: 

ForeSee Results mobile satisfaction

There's nothing surprising on the list above. Amazon has a great brand and has made huge investments in mobile. What's perhaps surprising is the absence of eBay from the top 25. 

ForeSee also found that 70% of survey respondents were using their mobile phones in stores during shopping. Other surveys have shown higher numbers. In addition, if smartphone users are isolated the numbers are certainly higher (above 80% or 90%). 

Regardless perhaps the most interesting survey finding is that a majority of mobile users said they accessed the retailer's website (though mostly not their apps) while in the store. 

How did you use your mobile phone while in retail stores this holiday season?

  • 62% accessed the store's website on their phone (satisfaction for this group is 79)
  • 37% accessed a competitor's website on their phone (77)
  • 21% accessed a shopping comparison website on their phone (77)
  • 20% accessed the store's mobile shopping app on their phone (79)
  • 11% accessed a competitor's mobile shopping app on their phone (77)

Again: 62% accessed the store's website on their phone. People have always assumed that in-store mobile usage is about buying on Amazon or getting competitive price information. It turns out, not exactly. 

Many of these users are looking to a retailer's mobile website to perform traditional in-store sales or customer service functions. People want more information about products (e.g., reviews) and they're looking for it via the mobile web rather than trying to find a sales person or service rep in the store.

It means that retailers need to develop their mobile sites and apps with the idea that users are often in their own stores and these sites/apps are more likely to be in-store shopping aids than e-commerce sites. They need to think of the in-store experience now as multi-channel. Retailers should also aggressively be using their mobile sites to drive downloads of their apps which should offer an even better experience.

The app then becomes a mobile marketing and loyalty tool for the retailer. 

This may not sound like anything other than self-evident information or advice. But the heavy in-store context of mobile app/site usage requires a shift in retailer thinking. Rather than a parallel or independent channel retailers must consider mobile as a kind of sales assistant that can and should augment the in-store experience as much as anything else. 

The Miserable State of (Local) Mobile Ad Creative

Location-based ad network Verve Mobile announced a Series C investment this morning of $15 million led by Nokia Growth Partners. This brings to more than $21 million the funding raised to date by Verve.

The company is one of several location-based mobile ad networks. An incomplete list of others includes xAd, YP, LSN Mobile, Telenav/ThinkNear, Marchex. In addition, all the major mobile ad networks offer varying flavors of geotargeting.

While local-mobile advertising holds enormous promise, most mobile display revenue forecasts associated with the segment are overblown for many reasons. They often contain overly simplistic assumptions or fail to recognize the complexity of the space and challenges that must be first overcome to realize its potential. 

In addition to local "infrastructure" challenges and the difficulty of proving ROI from mostly offline conversions, a major challenge facing local-mobile advertising is poor or sloppy mobile ad creative. Weak mobile creative is a problem with mobile advertising in general but it's especially true in the local space. The following are a few examples of the "current state of the art." 

Screen Shot 2013-02-13 at 10.25.45 AM

Beyond the fact that there's no call to action on the Tiffany's banner above, the landing page showcases various types of jewelry for e-commerce sales. However it's highly unlikely that a consumer would click on the ad and then buy a necklace or other jewelry item within the ad. People might go to the Tiffany's site later and buy there. 

However, what's much more likely is that someone would peruse the jewelry online but buy later in a local store. Unfortunately the store locator is yet another page down and generally buried. It should be much more prominently displayed on the landing page and connected to maps and directions. 

Screen Shot 2013-02-13 at 10.27.52 AM

The ad above was presented on the AP news app. One problem is that the ad copy is small and challenging to read. However, what's more problematic is the way that the ad dumps users into an HTML5 version of Google Maps without any context, branding or additional information. 

It's a map to lead you to a dealer (one infers) but you don't actually know what you're looking at or how it connects to the ad clicked on.  

Screen Shot 2013-02-13 at 10.29.45 AM

Immediately above is a Radio Shack ad that appeared in a local newspaper app. Like the Tiffany's ad it's really promoting e-commerce. Radio Shack has hundreds of local stores but nowhere -- not anywhere -- in the ad is there an obvious store locator. Again, the majority of users are unlikely to buy directly through the ad. The lack of a store finder is a missed opportunity. 

These are just three recent examples among many others of the many problems with mobile display and local-mobile display advertising in particular. 

Google Introduces Enhanced AdWords Campaigns to Boost Mobile Ads (and Revenues)

Google today introduced some major changes to AdWords to both make it easier to manage campaigns across multiple screens and to enabled more "nuanced" bidding and targeting. There's a very complete discussion at Search Engine Land.

A cynic or skeptic would argue the changes are directed primarily at bringing more advertisers into mobile and bringing mobile revenues up for Google (although advertisers can effectively still opt out of mobile). 

One of the major changes is that advertisers can now make mutiple bids ("bid adjustments") for a single ad based on variables such as device, location and time of day. Mobile bids will be set at desktop/PC levels -- mobile CPCs are lower than desktop CPCs -- and advertisers will have to actively reduce them if they want to bid less for mobile clicks. 

Some may see this as "strong arm tactics" by Google to raise mobile search revenues. However the company believes it's simply adapting AdWords capabilities for a new multi-screen environment.  

Below are some of the main bullets (slightly edited) from the Google Inside AdWords blog explaining the new features: 

Bid adjustments: With bid adjustments, you can manage bids for your ads across devices, locations, time of day and more — all from a single campaign.

Example: A breakfast cafe wants to reach people nearby searching for "coffee" or "breakfast" on a smartphone. Using bid adjustments, with three simple entries, they can bid 25% higher for people searching a half-mile away, 20% lower for searches after 11am, and 50% higher for searches on smartphones. These bid adjustments can apply to all ads and all keywords in one single campaign.

Dynamic creative: People on the go or near your store may be looking for different things than someone sitting at their desk. With enhanced campaigns, you’ll show ads across devices with the right ad text, sitelink, app or extension, without having to edit each campaign for every possible combination of devices, location and time of day.

Example: A national retailer with both physical locations and a website can show ads with click-to-call and location extensions for people searching on their smartphones, while showing an ad for their e-commerce website to people searching on a PC — all within a single campaign.

New conversion metrics: Potential customers may see your ad and download your app, or they may call you. It’s been hard for marketers to easily measure and compare these interactions. To help you measure the full value of your campaigns, enhanced campaigns enables you to easily count calls and app downloads as conversions in your AdWords reports.

Example: You can count phone calls of 60 seconds or longer that result from a click-to-call ad as a conversion in your AdWords reports, and compare them to other conversions like leads, sales and downloads.

All of these enhancements are designed to make search advertising both easier and more effective for marketers in a larger, more fragmented device universe. By the same token Google is trying to generate more money from its mobile advertisers and clicks, something it has struggled somewhat to do. 

In its last quarterly earnings Google reported that average CPCs decreased 6 percent vs. Q4 2011 (attributable almost exclusively to mobile). 

With Its $12 Billion Marketing Budget, Samsung Now 'Owns' Android

I've written here and elsewhere about the fact that Samsung is increasingly the dominant global Android OEM. Samsung has ridden the Android wave to huge profits and near-global domination of the smartphone market. However the company is ambivalent about Android.

As Benedict Evans points out Samsung isn't promoting the Android brand and doesn't really mention Android in its multi-billion dollar "Next Big Thing" marketing campaign. Accordingly Evans contends that Samsung's Galaxy brand has greater recognition than Android itself. This conclusion is based on Google Trends search data, which may or may not be accurate as a reflection of actual brand recognition or demand.

Screen Shot 2012-12-20 at 6.44.01 AM

There's plenty of other evidence in the market to support Evans' argument, however, including the above Android OEM comparison chart from ad network Millennial Media. Another data set from AppBrian also supports the same conclusion: 

With the possible exception of Huawei all the other Android OEMs are in decline (re market share) including and especially HTC, which is shifting its strategy to focus on emerging markets because it can no longer compete effectively in North America and Europe. 

What happens when Samsung so totally dominates the Android landscape that it can start using that leverage against Google or creating its own "forked" version of Android independent of Google (as Amazon has done with Kindle Fire)? That's presumably why Google is working on the "X-phone" through Motorola -- to try and create a viable rival to the Galaxy. But will Google be willing to go toe-to-toe with "partner" Samsung in terms of marketing dollars? 

No is the short answer. Samsung reportedly spends roughly $12 billion annually on marketing its mobile devices. That fact alone makes it hard for any other Android OEM, even Google-Motorola, to compete. Only Apple is really in a position to compete with Samsung. 

Study: Low Awareness of Digital Wallets Other than PayPal

Online measurement firm comScore released data from a new survey about digital wallet awareness and acceptance among US consumers. The survey was conducted in November 2012. It underscores familiar themes in the existing coversation about digital wallets: most consumers are largely unaware of the offerings, but those that are have security concerns.

In the context of this research "digital wallet" means online and mobile. To that end, the survey data showed that PayPal and Google Wallet were the only two payments products that enjoyed meaningful consumer awareness. In terms of usage, only PayPal has seen any real adoption -- largely because of its long established online history. 

Screen Shot 2013-02-05 at 7.53.36 AM

Echoing many other surveys the comScore data found that security was a concern for many users. Like almost every one before it, the study concludes that consumers need to be educated about the overall benefits of digital wallets and the features that make them more secure than conventional credit card payments.

In a Q3 2012 survey we found very limited interest in mobile payments. 

How interested are you in using your mobile phone to pay for things, and replace cash or your credit cards?

Survey: mobile payments

Source: Opus Research (August, 2012; n=1,501 US adults)

From a demographic standpoint, people under 45 were considerably more interested in mobile payments than people who were older. Similarly, a recent survey (n=1,155 US adults) by the Raddon Financial Group found that that younger adults (Gen Y) are most likely to be interested and most likely to see value in mobile wallets.

Mobile wallet interest

Source: Raddon Financial Group (2012)

A recent survey from Harris Interactive is more bullish on the outlook for mobile payments than was ours:

“How interested are you in being able to use your smartphone to process in-person payments via tapping a special receiver, rather than using cash or payment cards? 

  • Very interested in using my smartphone instead of cash or cards: 8%
  • Somewhat interested in using my smartphone instead of cash or cards: 19%
  • Not very interested in using my smartphone instead of cash or cards: 12%
  • Not at all interested in using my smartphone instead of cash or cards: 43% 

This was the full mobile-user population. The following were the smartphone-only responses: 

  • Very interested in using my smartphone instead of cash or cards: 16%
  • Somewhat interested in using my smartphone instead of cash or cards: 28%
  • Not very interested in using my smartphone instead of cash or cards: 16%
  • Not at all interested in using my smartphone instead of cash or cards: 30% 

While the benefits of "horizontal" wallets and mobile payments solutions (e.g., Google Wallet) are often unknown or ambiguous to consumers, what will drive (and is now driving) mobile payments adoption are "point solutions" that are highly specific. In these scenarios the benefits are concrete and self evident: 

Apple the OEM Now Driving Most Mobile Internet Traffic Globally and in US

Amid all the hand wringing over Apple's "impending decline," it's interesting to note new traffic metrics from StatCounter that show Apple driving more mobile Internet traffic than any of its rivals. This is partly a product of the iPhone 5's success during the holiday quarter. 

The StatCounter data reflect mobile OEM market share based on actual Internet traffic. This stands in marked contrast to most smartphone and tablet market share estimates (from IDC, Gartner, comScore and others) that are based on shipments or consumer surveys. There are a few actual traffic measurements out there (e.g., Chitika) but not many.

That's why StatCounter's data (as a reflection of actual user behavior) are so interesting. Shipments is an inherently flawed metric that may or may not correspond to actual sales to end users. 

The "headline" being used along with this new StatCounter OEM data is that Apple has overtaken Nokia as the company driving the most Web traffic on a global basis. Samsung is third. In the US Apple is much farther ahead of rivals, including Samsung. Nokia by comparison drives just over 3% of mobile Web traffic in the US market.

Top 10 Mobile Vendors (Global)

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Top 10 Mobile Vendors (US)

Screen Shot 2013-02-04 at 11.00.25 AM

It's interesting to compare the above numbers to "mobile OS" and mobile browser figures from StatCounter. The vendor and OS numbers are essentially identical in Apple's case, as they should be. The browser numbers are not. They suggest that roughly 10% of iOS users in the US market are using browsers other than Safari. 

Top 10 Mobile Operating Systems (US)

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Top 10 Mobile Browsers (US)

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On a global basis the Android OS has a greater share of traffic in the aggregate than iOS: 37% to Apple's 26%. 

Top 10 Mobile Operating Systems (Global)

Screen Shot 2013-02-04 at 11.03.33 AM

It's not clear to me whether StatCounter captures and includes apps in its traffic estimates -- I believe it's just conventional Web traffic. Regardless, traffic is a much better metric to discuss than handset or device shipments in terms of the influence and importance of the competing mobile platforms.

Super Bowl Advertisers' Missed Mobile Opportunity

While a few ads shown during yesterday's Super Bowl were noteworthy most were a bust -- and largely a waste of the nearly $4 million it reportedly cost to buy airtime during the game. Matt McGee at Marketing Land did a nice job of tracking and reporting on social media mentions or "calls to action" on most of the ads (Twitter and hashtags were most common).

Oreo is emerging as one of the big winners, with its fast reaction to the game's 30+ minute power outage.

Yet for all the energy put into associating ads with hashtags and social media, there was an almost total absence of explicit mentions or references to mobile. The only mobile app mention that I was aware of came on a quickly shown credits screen during an ad for the forthcoming Star Trek sequel (upper right image). Exact Target confirmed my own informal sense of that yesterday. 

A large percentage of people watching the game in the US were smartphone owners. As you already know, and as Nielsen and others have confirmed, there's a very high level of "second screen" behavior among smartphone owners. These Super Bowl ads were a huge opportunity to drive app downloads for brands. And other than the Star Trek mention, which raced by in less than a second, nobody talked about apps at all. 

One might have expected real estate company Century 21 to mention its mobile site or app in its several mediocre commercials given that so many people use mobile during their house hunting. But they did not. I could go on with numerous other examples. 

Perhaps the assumption among the agencies that produced these commercials was that people would be using Twitter or Facebook on their smartphones or tablets and the mobile call to action was thus implied. Yet it's more likely that marketers didn't really know what to do with mobile specifically and so were simply silent on the subject.