LocalMobileSearch

Apple iOS Devices Continue Market Dominance in Mobile Advertising

Mobile advertising and platform exchange firm Velti has released its monthly snapshot on the "State of Mobile Advertising" for February 2013.

Among the interesting tidbits, the report found Apple iOS devices accounted for a whopping 8 out of the top 10 mobile devices serving ad impressions. iPhone devices had a 37.4% share, while iPads comprised 17.2% of all impressions served in February.

And while Samsung Galaxy devices comprised less than 5% combined market share, the report speculates the release of Galaxy S 4 might significantly alter the mobile ad market in the coming months.

In terms of market share by OS, Apple still clearly shows an advantage holding steady at around 65% for the month of February 2013.

One noteworthy datapoint in the report highlighted how weekends continue to see the highest levels of app usage, with Sundays accounting for 15.7% of all impressions served. The report stated: "Publishers and marketers should keep in mind daily usage patterns as an important factor in getting the highest return on clicks, and ultimately revenue, for their specific site or app."

Velti’s "State of Mobile Advertising" report gathers data from the Mobclix Exchange and is provided on a monthly basis.

Report: iPhone Traffic Still Roughly 2X the iPad in North America

Recently there have been several reports starting to show that tablet (iPad) traffic is beginning to overtake smartphone traffic. For example, a report last week from Adobe found that, on a global basis, tablet traffic now exceeds smartphone web traffic (8% to 7%).

A new report from ad network Chitika, however, says that at least in North America the iPhone still generates roughly 2X the web traffic of the iPad. The iPad dominates tablet-only traffic with more than 80% market share. 

In late February, Chitika looked at traffic distribution from "250,000+ publisher websites." The company found that "iPhone users still generate more than two times the traffic of [ ] iPad users."

The iPhone was responsible for 61.5% of North American web traffic from iOS and the iPad for just under 31%. The iPod Touch drove roughly 8% of iOS-generated web traffic according to Chitika. 

The Chitika report didn't look at engagement or time on site. The earlier Adobe report found that "on aver­age inter­net users view 70% more pages per visit when brows­ing with a tablet com­pared to a smartphone."

As tablet penetration grows, we should see its share of iOS and all web traffic commensurately grow. The interesting question is whether tablets are substituted in the home for smartphones or PCs. A recent Google-Nielsen report found that 77% of smartphone search activity happened at home or in the workplace (when people typically have ready access to PCs).

Samsung Debuts 'Life Companion' S4, Apple Compelled to 'Go Big' by Galaxy's Success

Last night in New York Samsung formally announced its much anticipated Galaxy S4 follow-up to its hugely successful S3. The hardware update was relatively modest: a somewhat larger high-resolution AMOLED screen, more CPU power and thinner body. It will be challenging to tell the S4 from the S3 without a close look. 

Much of the evening was about software though decidedly not about "Android" or "Google." Android got a single mention and Google was never mentioned.

Here are the S4's major "specs":

• Screen: 5 inch HD Super AMOLED (1920 x 1080) display, 441 ppi
• Processors: 1.9 GHz Quad-Core Processor / 1.6 GHz Octa-Core Processor
• OS: Android 4.2.2
• Camera: 13MP (rear), 2MP (front) 

With its splashy, Broadway inspired show last night Samsung entered Apple's "big launch" turf. It also perhaps unwittingly emulated Apple's "incremental" handset update cycle. Indeed, we might call the S4 the "S3s" because of its "evolutionary" changes over the S3. 

There were tons of software updates and new additions to the handset; many of them related to the camera and many of them were impressive seeming. However today several outlets are reporting that the Samsung software didn't always work as promised. In fact the S4, which will undoubtedly be popular, has received some quite mixed reviews -- especially from Gizmodo last night, which called it a "missed opportunity." 

Samsung has taken a bit of an "A/B testing" or shotgun approach, if you prefer, to developing mobile devices. Over the past three years it has released a wide range of tablets and handsets vs. Apple's much more deliberate and controlled pipeline. Yet through its experimentation with larger screens and a range of devices (as a differentiation strategy) it has helped cultivate in consumers an appetite for larger smartphone screens. 

But for that shift in the public's appetite, Apple wouldn't have made the "taller" iPhone 5. Yet there's considerable pressure to make still larger iPhones. 

A larger screen has become one of the key hardware features and differences between the first-tier Android handsets (especially from Samsung and HTC) and the iPhone. Thus Apple will be rolling out an even bigger iPhone (probably at 6). Apple would do well to bring that larger phone this summer and not wait another full year to do so.

Apple is not used to compensating and being on the defensive. It normally leads the market with design. But it has been playing catch-up recently.

The unexpected success of smaller tablets forced it to create the iPad Mini. And the unanticipated development of giant-screened smartphones (Note II, S4) forces Apple to offer a larger iPhone, thereby betraying Steve Jobs' "single hand" operation philosophy. In addition the need to sell more iPhones in developing markets (vs. less expensive Androids) has given rise to rumors of a cheaper, "more plastic" iPhone. 

Samsung clearly emulated, imitated or copied (take your pick) the iPhone's look and feel at the outset. But the Korean company has now gone beyond it in several ways -- including in the hyperbolic claim that the S4 is a "life companion." And, ironically, Apple is now being compelled by the Galaxy line's success and by public demand to make the iPhone much more like Samsung handsets. 

Users Prefer Apps to Mobile Sites But High Expectations Burn Developers

Many developers and digital marketers still cling to the assumption that HTML5 and the "mobile web" will eventually win out over native apps. There's a kind of logic to that position. However they may be waiting a very long time for that to happen.

As has previously been written, the overwhelming majority of consumer time spent with mobile devices is spent in apps ("4 out of every 5 mobile minutes," per comScore). And according to a new survey from Compuware the majority of international respondents (85%) preferred apps over mobile sites.

The survey had a total of just over 3,500 respondents from the US, UK, France, Germany, India and Japan.

Despite the positive news for app developers the survey also had some harsh findings. For example 59% of respondents said that an app should load in two seconds or less. In addition, poor user experiences result in app abandonment, switching to competitors' apps, negative word of mouth and erosion of brand perception -- among other negative consequences.

The most common problems encountered were freezing/crashing (62%) and slow load times (47%), as well as the more generic "didn't function as expected" (37%). A majority of users had encountered one or more of these problems in using apps. Users expect apps to load faster and perform better than mobile sites: "78% expect mobile apps to load as fast as — or faster than — a mobile website."

Nearly 80% of the survey respondents said that they would give an app one (maybe two) more chances if it didn't work correctly the first time. And app-store ratings are being taken very seriously by users: "84% users say app store ratings are important in their decisions to download and install a mobile app."

The survey report cited third-party data for the proposition that the average number of apps on users' smartphones is 41.  

US Teens Go Online 'Mostly' through Mobile Devices

The key figure from a new US "teens and technology" survey by the Pew Internet Project is this: 50% of teens who own smartphones primarily access the internet that way. According to Pew (the data are from Q3 2012) 78% of US teens overall own cell phones and nearly half (47%) of them own smartphones.

I suspect if the data were from 2013, smartphone penetration would have easily crossed 50% because of Q4 holiday gifts. Among all teens (including those who don't own a cell phone), 37% own smartphones.

Part of the reason that US teens may rely more heavily on their mobile phones (and tablets) for internet access is that some do not own PCs or share PCs with their families. Thus mobile devices are more private and personal because they're not shared. Regardless teens' orientation to the internet is more mobile than their parents'.

The survey also found that 23% of US teens owned tablets (compared with 25% of US adults).  

As these teens "grow up" it will be interesting to see if they adopt a more "balanced approach" and access the internet equally from PCs, tablets and smartphones. I suspect their bias will remain toward mobile devices, with tablets taking the place of PCs for non-smartphone access. 

An October 2012 survey (n=7,700 teens) by financial firm Piper Jaffray found that Apple held an advantage among US teens:

• 40% owned iPhones (representing a majority of smartphones)
• Next phone: 62% were going to buy an iPhone, 22% Android
• 44% reported owning tablets (72% of those were iPads) 

Changing of Guard at Android Suggests Consolidation of Google Operating Systems

There has always been a somewhat awkward relationship between Google's Chrome OS (PC) and Android OS (mobile). Many people have remarked about it. Today that tension was potentially resolved.

Google CEO Larry Page announced that Android founder and Google Mobile chieftan Andy Rubin was transitioning to another role at the company. In his place SVP Sundar Pichai (who was once unsuccessfully recruited by Twitter) will take over leadership of the Android team. Pichai is currently responsible for Chrome OS and the two groups will be under his combined command.

Here's what Page said about him in a blog post announcing the change:  

Sundar has a talent for creating products that are technically excellent yet easy to use—and he loves a big bet. Take Chrome, for example. In 2008, people asked whether the world really needed another browser. Today Chrome has hundreds of millions of happy users and is growing fast thanks to its speed, simplicity and security. So while Andy’s a really hard act to follow, I know Sundar will do a tremendous job doubling down on Android as we work to push the ecosystem forward.

There's a clear logic here and the move makes sense. But my instincts tell me that all may not go as smoothly as that logic suggests. 

By all measures Android is flying high: "60 manufacturers; more than 750 million devices have been activated globally; and 25 billion apps have now been downloaded from Google Play." Yet device activations have slowed somewhat and Samsung has all but taken control of Android handset (and perhaps eventually tablet) sales. Samsung Galaxy devices represents an increasingly large share of all Android sales. 

Windows Phone is unlikely to challenge Android, nor is BlackBerry -- for at least the foreseeable future, if ever. Android can coast for some time (which is clearly not happening) and the platform would continue to dominate globally. By some estimates Android is on 80% or more of Chinese smartphones.  

If indeed this leadership change is a precursor to OS consoidation we may see some technical challenges a la Windows as a unified operating system across devices. But then again, but for Apple (and partner Samsung), Google really has no competitive threats to its global-mobile dominance on the horizon.  

A Report for Those Who Doubt Mobile ROI

This morning Google released the results of an extensive study conducted among US mobile users with Nielsen in Q4 2012. The survey explores mobile search behavior in particular and uses a combination of interviews, online survey data, diaries and search query logs to get a holistic picture of search activity on smartphones. Tablets weren't part of this research. 

Among the many interesting findings there are two big ones that stand out: 77% of mobile searches happen at home or work, even when there's a PC nearby. And 55% of mobile-search related conversions (call, store visit, purchase) happen within "one hour or less" of query completion.

These two stats illustrate two larger "truths" about mobile. The first is that mobile devices are increasingly "primary" for people as a method of internet access. Speed and convenience were cited by respondents as reasons for substituting a smartphone for a PC in a search context. 

Marketers need to be cognizant of the fact that large numbers of people will be using their smartphones (and tablets) at home to search for things, whereas before they might have used a PC. At work people may be motivated by other considerations, such as privacy, to use mobile devices vs. corporate-provided PCs. 

The other "truth" is illustrated by the 55% figure: conversions often happen very quickly after a mobile search. This reinforces the notion of the focused, "need it now" mindset of many mobile search users. Mobile searchers take a variety of actions after completing their queries. They go to websites and do additional research, they make phone calls and they go into stores. They buy things. 

But marketers can't see most of that activity, hence the complaints about mobile ROI. Most marketers get confused and "lose the trail" when users go offline. You can track calls and site visits, you can capture email addresses and you can monitor e-commerce transactions via mobile. However it's challenging to get complete visibility on all the ways that mobile is influencing purchase behavior.

The slide above illustrates the range of activities mobile search triggers. But more importantly, Google and Nielsen found that 45% of mobile search queries were undertaken to help make a purchase decision -- so-called "goal oriented" searches. And most of these will result in a conversion, often offline. 

The totality of the data released in this study (download the pdf) show that mobile users are more focused and are typically farther down "in the funnel" than PC users. Mobile (search at least) is clearly driving lots of conversions. Marketers just need to open their minds about what constitutes a "conversion" and get creative about ROI and attribution. 

Otherwise, they're not seeing what's really happening with their customers and how critical a role mobile is playing in the overall marketing and sales process.

Report: Tablets Mostly Beat Smartphones for Ad (CTR) Performance

Many of the Q4 reports released by the ad networks and major agencies showed the growth of tablet-related ad spending. That's a trend that will further accelerate under Google's new "Enhanced Campaigns" regime in which tablets are grouped with PCs for paid-search advertising purposes. In other words, marketers cannot separate PC and tablet paid-search campaigns. 

Last week Adobe reported that tablets had passed smartphones for share of global traffic.  

In many ways tablets are the new PCs, taking their place for many at home use cases. Tablet owners tend to behave more like PC shoppers, including displaying a greater willingness to covert online. By contrast, smartphone owners typically don't convert on the small screen making ROI harder to track for marketers targeting those devices. 

Because online conversions are more likely and prevalent for tablet users, the "danger" is that marketers will neglect smartphones or that smartphones will be "ghettoized" and considered good for only a limited number of purposes. In fact mobile/smartphone advertising is great for both DR and branding purposes. 

Mobile DSP Adfonic now offers data that show, across most categories, tablet advertising appears to outperform smartphone ads in terms of CTRs (though ultimate influence on conversions isn't measured).

As the chart above reflects, "tablets achieve especially strong CTRs for advertisers in the Style & Fashion, Lifestyle & Health, Entertainment & Media, and Travel verticals." Smartphones are stronger in other categories such as retail and automotive. People tend to use tablets in the evenings and on the weekends. 

Over time marketers will determine which devices are better suited to which types of advertising. However companies need to have a comprehensive strategy that recognizes the "multi-screen" consumer, who will move from device to device before converting. 

Although Kindle Fire and Nexus 7 are gaining, Apple tablets continue to dominate web traffic. The following chart shows North American traffic over the past three months, comparing the top-three devices on Chitika's ad network.