One of the most eagerly sought electronics products this year is the tablet. We should see millions of them bought over the holidays. Indeed, tablets will be an enormously popular gift item. But which one(s) will be successful and which ones will fade?
Today, for "Cyber Monday," Amazon is promoting the upgraded Kindle Fire (with special offers) for $129 vs. its normal $159 (reduced from last year's $199). This should generate quite a few sales.
However the Kindle Fire is not as popular on Google as the company's own Nexus 7 or the iPad Mini. According to data released by Google earlier today the following are the Top 10 Google Search Shopping Queries (today):
Meanwhile PriceGrabber shows a somewhat different list of "most searched" electronics products:
Both of the above lists indicate the Nexus 7 is the most "searched for" tablet out there -- even the most popular product. However, over at Amazon Kindle Fire and other Kindle devices dominate the electronics bestseller list.
Finally, a recent consumer survey Opus conducted (n=1,048 US adults) asked "Are you planning to buy a tablet computer this holiday season?" Here were the results:
In our survey Nexus 7 was the least desired of the tablets and iPads were the most popular. All this data seems to suggest that iPad, Nexus 7 and Kindle Fire will do well, while Surface, Nook and other "no name" tablets will generally be ignored and suffer.
There's a relatively common perception that "daily deals are dead." What's more accurate to say is that the daily deals "bubble" has burst and consumers are burned out on push email marketing, where many of the deals are irrelevant to their interests or needs. But it would be inaccurate to say that "deals are dead."
Coupons and deals remain popular among consumers and mobile users in particular. According to data from Nielsen, xAd and Telmetrics, the three top reasons that a mobile user would engage with an ad are the following:
Consistent with the findings above, "search for/receive mobile offers" (especially locally relevant ones) is one of the top three "mobile commerce" activities that users engage in according to 2012 data from the US Federal Reserve and JiWire. They also search for coupons on smartphones while in stores according to multiple surveys and behavioral studies.
A new set of data from Nielsen tries to identify where mobile users get those deals and coupons. A majority get mobile vouchers from retailers directly (sites/apps), followed by deal of the day sites/apps.
Among the daily deal apps Nielsen found that the "usual suspects" were the most often used: Groupon, LivingSocial, Google Offers and AmazonLocal (LivingSocial). Amazingly, of those who have sought out daily deals on their smartphones, 91% have done so through the Groupon app.
This shows that relatively few daily deal vendors have any brand awareness and usage beyond these major sites. But among them Groupon is far and away the leader.
Apple's products constitute four out of the top five most-requested gifts by US kids (under 13) according to a recent poll by Nielsen. Among those over 13 the iPad still ranks as the most desired object for the holidays.
In the 6-12 age group, "tablet other than the iPad" shows up in 8th position but Microsoft Surface specifically appears second from last on the list, just ahead of Apple TV. In the over-13 age group, non-Apple tablet is 3rd though Microsoft Surface and Kindle Fire are lower on the list. Microsoft Surface is again second from the bottom on the over-13 list with a lower percentage of respondents interested than in the under-13 cohort.
The sample size wasn't disclosed and the question asked isn't technically about the holidays but about purchase interest or intent "in the next six months." However these requests will probably register in December. If parents comply it should be a very good quarter for Apple. Below are the full lists.
Kids under 13:
Kids 13 and over:
Opus is in the midst of a consumer survey asking about which tablet they intend to buy over the holidays. In our survey (still in process) 85% of respondents said they weren't planning to buy one now. However the age group most interested is 25-34; 21% say they plan to buy a tablet in the immediate future.
Overall, among those who've said they're planning to buy a tablet during the holidays, the ranking is as follows:
The IAB just released its second mobile shopping report, including its ranking of the most "mobile savvy" cities in the US. Houston, remarkably, comes out on top for a second year. Houston is also the "fattest city in America" according to Men's Fitness magazine.
The mobile shopping study also found surprisingly high numbers of users who owned "connected devices" (tablet and/or smartphone). The numbers here are much higher than Nielsen and comScore figures for smartphone ownership. According to the data the San Francisco Bay Area had the highest smart device penetration at 78%. Among the top DMAs Detroit was lowest with 62%. I suspect these numbers are not entirely representative of the mobile subscriber population and a bit high -- though perhaps not radically so.
The IAB report, which draws from a variety of survey and data sources, confirms that smartphone users are aggressive and engaged mobile shoppers but they generally don't buy things on those devices (tablets are different). The IAB (citing comScore) reports that 86% of US smartphone owners visited retailer websites or used retailer mobile apps in July.
The graphic above doesn't entirely make sense (81% vs. 85.9%) but it makes the larger point that most smartphone owners are accessing retail information on their devices.
In stores smartphone owners use their devices to communicate with other people about intended purchases, check prices and product information and look for deals. However only 5% in this survey bought anything with their mobile handsets.
The report also confirms that most tablets are not used "on the go," while shopping. However that may change with the advent of carrier-supported 7-inch tablets and the 5-inch Galaxy Note (also obnoxiously known as a "Phablet").
This is just one more set of data that underscore the importance of being "mobile ready" and fully understanding how mobile can be used for customer acquisition and customer service, even in stores. Mobile is an instrument of "showrooming" but it can also be an avenue for customer service and retention among traditional retailers. Yet most are simply not ready.
Almost daily my inbox is hit with a new study or report that expresses a similar theme: businesses large and small aren't ready for mobile shoppers. However one would expect retailers to have invested and be prepared for the coming multi-screen holiday season. Not so, says an informal usability study from Keynote systems.
Keynote examined major retail and e-commerce sites on iPhones, Android devices and BlackBerry handsets. It found numerous problems and inconsistencies from device to device. The inference is that retailers aren't actually testing their own sites on the various platforms and operating systems.
Some of the problems Keynote identified are minor (copy not optimally presented) but some are major (broken search functionality). Furthermore many of the retailers didn't seem to be addressing the tablet audience. Keynote explained, "We also looked at Target on the iPad 3 and see that they probably haven’t been testing on a tablet and are content to delivering their desktop site to a tablet on good faith."
Tablets drive actual online conversions, whereas smartphones are mostly used to check reviews, price information and locate and contact stores. Tablet conversions are as high or higher than on PCs and average order value from tablets is higher than on the PC. It's critical for retailers and etailers to address the tablet audience specifically.
Most retailers appear to believe that their sites will "work" for tablet users. That's true in many cases but a tablet-optimized retail experience would almost certainly drive more online sales and increased user satisfaction.
According to Skava only 7% of retailers currently have tablet-friendly sites. Accordingly this year may turn out to be a missed opportunity for most retailers when it comes to mobile and tablet users. Here's Keynote's conclusion, which is simply common sense:
Early testing of both mobile websites in preparation for the holiday season would have prepared these top retailers for the judgmental mobile shopper this season. With holiday shopping looming and ready to begin in just days, it seems that these top retailers are already running into hurdles that may affect their holiday sales goals.
According to Nielsen, Caucasian/White Americans lag behind other groups when it comes to smartphone adoption. The data below are part of Nielsen's recent cross-media study (Q2 2012).
Based on data from many thousands of users, Nielsen reported that 70% of Asian American adults now own smartphones, while 62% of African Americans and 60% of Hispanics also do. By comparison "only" half of Whites own smartphones.
The year will probably end at or very close to 60% smartphone penetration in the US. That would mean something like 150 million smartphone users, most of whom would also be mobile internet users.
TV remains the king of all US media channels in terms of time spent -- but it's not necessarily quality time. Our attention is increasingly split; simultaneous media usage is growing. In addition there's considerable reason to believe that TV advertising is now less effective than mobile advertising.
As a real-world case-in-point that is representative of larger trends, my 13 year old never watches TV shows (on Hulu Plus) without a smartphone so that she can check Instagram and text friends at the same time (during commercials).
According to a new Nielsen "State of the Media" report, "The average American consumes nearly 39 hours of content each week on the TV set, on the computer and on mobile." The bulk of that time is with TV but roughly 40% of smartphone and tablet owners are watching TV at least once a day while using other devices (i.e., smartphones, tablets) simultaneously.
Nielsen found that simultaneous tablet and TV use skews older while simultaneous smartphone and TV use skews younger. This "second screen" usage may contribute to the diminishing effectiveness of TV advertising, which has been declining since that advent of the DVR.
It turns out that mobile video advertising is more effective than TV. A Q2 study from Nielsen and AdColony "measured the brand and ad effectiveness of the exact same 15-second [CPG] video spot in live campaigns across TV, online and mobile." What the research found was that the same ad delivered better results in a mobile context than online or on TV.
Relatively speaking mobile video ads are dirt cheap by comparison to TV. Below are the study results comparing performance of the same video unit in the three different contexts:
Mobile video ads:
Online video ads:
In the study, the mobile ad dramatically outperformed the other screens across these traditional brand metrics. Some of this is undoubtedly the result of novelty but it's also the way in which mobile commands user attention in ways that TV and the PC internet have lost the power to do.
This month's Millennial Media "SMART" report takes a closer look at the behavior and goals of mobile advertisers in the restaurants and retail vertical. Apparel retailers and fast food/national restaurant chains are the two largest categories of advertisers on the Millennial network in this segment.
Citing June comScore data Millennial reported that "Females spend nearly twice as much time on mobile Retail & Restaurant apps and mobile websites as men do."
The main campaign goal of both sets of advertisers was to drive foot traffic into local stores. Accordingly retail and restaurant advertisers were more interested than average in getting people to store locators and maps on landing pages, as well as exposing promotions (coupons). The were also interested in generating mobile commerce. However unless there's a stored credit card on file there will probably be no m-commerce.
These restaurant and retail advertisers were much less interested than average in driving application downloads. This apparent lack of interest in getting apps onto the smartphones of their customers and prospects reflects a misunderstanding of the role apps can play in stimulating sales and improving retention and customer service.
Finally Millennial reported that restaurants and retail was the number three category in terms of ad spending on its network -- more than automotive, travel or CPG:
Last week the Android Police blog received a tip and some screenshots that showed what Google will soon be unveiling in its ongoing quest to penetrate the payments segment: a plastic card. Google is moving forward by going back.
While it initially seems self-defeating -- Google Wallet is supposed to get rid of plastic -- it is both an innovation to broaden Google Wallet's apppeal and an interim step that now appears necessary in the transition from plastic to true next-generation payments systems.
Google Wallet (the NFC mobile payments tool) remains obscure to most US consumers, although it has been out and operative for well over a year. A plastic card would allow Google to dramatically extend the reach of Wallet without mobile carrier involvement, approvals or the need to do much consumer education. These are the considerable benefits of a plastic card for Google.
Image Credit: Android Police
Below are some of the highlights of what was revealed in the screenshots (only a few of which are above):
The benefits of the Wallet card being promoted in the third panel above are:
PayPal also has a plastic card, introduced earlier this year. The Google Wallet card is probably modeled pretty directly on PayPal's card and copies many of its key features. It appears, however, there may be some additional features unique to Google Wallet. I'm not sure from the information I've seen and Google is not ready to speak about the product.
The logic behind Google's new plastic card is clear. Google was caught off guard by carrier resistance or hostility to Google Wallet. Among the major US carriers only Sprint has truly embraced Wallet. While AT&T isn't officially blocking it (Verizon is) the carrier doesn't promote Wallet either.
Most US and European consumers are well versed in plastic payment card culture but they typically have no idea whether their phones carry an NFC chip.
PayPal announced a few months ago that the reach of its plastic card is being dramatically expanded through a deal with Discover and use of the latter's financial network. The Google Wallet information revealed above suggests that Google has or is negotiating a comparable (and perhaps broader) deal with credit card processors.
As mentioned US consumers have not indicated a burning desire for NFC-powered mobile wallets or the ability to pay with their phones. A Google Wallet card could serve to introduce them to the Google Wallet service, while enabling them to pay in a familiar way: with a plastic card. Over time consumers' willingness to experiment and pay with mobile devices would presumably grow as their comfort with and trust in Google Wallet increased.
A plastic card would also enable Google to completely go around the gatekeeper-carriers and appeal directly to consumers, where its strength lies.
From a merchant point of view there would be no new infrastructure investment required, as there is with NFC point-of-sale terminals. There are currently about 300,000 NFC enabled terminals in the US.
When I first heard about this Google Wallet card I thought that consumers would be confused and not see a reason to adopt it. But the promise of carrying fewer plastic cards, the security features, potential offers and the ability to manage multiple payment cards in the cloud will be intriguing or appealing to many people.
It's analogous to Google Voice. Google Wallet is essentially being used to "forward" a debit for payment to any account or credit card in the same way Google Voice forwards and routes calls to designated phone numbers.
Thus for both PayPal and Google it would appear plastic cards are a "necessary evil" on the incremental path to "payments 2.0."
JiWire released its Q3 audience insights report earlier today. There are a number of interesting survey findings. However, it's important to note that JiWire's audience isn't necessarily representative of mobile users in the US and UK, or consumers more generally. The JiWire audience is large but generally more "mobile savvy" than average mobile subscribers.
One of the headlines is that the number of people using smartphones in stores for product research has grown significantly since last year.
The things that people are doing or researching on their smartphones in stores has remained pretty consistent: price comparisons, product reviews, deals.
JiWire also found that 65% of its smartphone-owning respondents also own a tablet. This is higher than tablet penetration in the population at large. The company also asked about behaviors on both categories of devices.
JiWire found that smartphone and tablet owners generally engaged in the same activities at the same relative levels. However a higher percentage of tablet owners was active in each category, chiefly because of the larger screen I would imagine.
Perhaps the most interesting data, however, has to do with so-called "m-commerce." For most people a semi-arbitrary $99 or $250 were the top amounts they were willing to spend in a mobile commerce transaction. There's nothing safer or more secure about a $99 transaction vs. a $500 transaction however.
Perhaps there's an irrational belief that smaller transaction amounts bring less exposure. Overall, however, the numbers of people willing to engage in m-commerce have grown over last year.
Interestingly (and perhaps again irrationally) JiWire survey respondents appear to be more comfortable researching a $100 product (on their smartphones) in their own homes vs. other locations. This is really interesting and may indicate something about the psychology of many smartphone users.
However, once again, there's not necessarily anything more secure in being at home compared to being on cell or WiFi networks outside the home.
An alternative explanation might be: more users simply have time to do research in the home and that's the most common location for smartphone usage. But I don't think that entirely explains the data in the chart below.