In this webinar hosted by Local Search Association, Opus Research's Greg Sterling will offer an overview of the indoor location ecosystem, various technologies in use, indoor analytics and the way in which online-to-offline tracking will revolutionize ROI. He will also discuss the privacy implications of indoor location and potential adoption timelines.
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Last week Placed introduced Placed Attribution, a mobile ads offline tracking solution. The idea is to used Placed's opt-in panel to measure the impact of mobile ad exposures on in-store visits. PlaceIQ has a similar offering using a different methodology.
Capturing the offline impact of digital ads on store visits (and potentially sales) is really a kind of "holy grail" when it comes to conversion tracking. The ratio of online to offline conversions is skewed heavily in the direction of offline. E-commerce is only 5.5% of offline retail and mobile commerce is approaching 10% of e-commerce.
Yet up to half of offline retail spending may not be impacted by digital media and the internet. Clicks are a terrible metric for mobile advertising, and secondary metrics like map views and calls are better but don't capture the entire picture for marketers.
There's a lot more "visibility" on performance when you can start to measure how digital ads impact offline purchase activity. That's the objective of Placed Attribution. Here are the kind of data to be reported:
Some of this will be extrapolated from a sample drawn from Placed's panel. Even so, it represents an advance over most of the ways in which marketers try to model attribution when it comes to mobile ads and offline conversions. Offline/in-store tracking will be common -- even mandatory -- for many categories of mobile ads within 12 - 18 months.
We'll be discussing "Ad Tracking to the Point of Sale" with PlaceIQ, Placed, xAd and Retailigence at the Place Conference on October 8 in San Francisco.
Earlier this week in something of a surprise JumpTap aggreed to be acquired by larger competitor Millennial Media for roughly $225 million in an all-stock deal. JumpTap had been on a publicly stated course toward an IPO. However JumpTap CEO George Bell told BizJournals that the uncertainty of the public markets swayed him in the direction of Millennial's offer:
"Our view was that Wall Street remained a very choppy, uncertain bedfellow and, despite good performance in our growth, it wasn't clear that we would have Wall Street's 'permission' to go public," Bell said. "Joining up with Millennial Media, of course, allows us to achieve a public status for our employees and shareholders without the pain of going through an IPO process ourselves."
Millennial bought smaller rival JumpTap in part because it needs to bulk up to better compete with bigger, more visible networks such as Google, Facebook, Twitter and even Pandora. Last year Millennial had revenues of roughly $178 million vs. $104 million in 2011.
With the addition of JumpTap, Millennial expects FY 2013 revenue to come in between $270 and $280 million. That's impressive growth but there's a substantial contribution being made by JumpTap's revenue. Compare the fact that Facebook is on course to make $1 billion in mobile revenue by Q1 2014 and Google will probably take in $4 billion in mobile ad revenue this year.
IDC's 2012 estimates put Millennial in the number two "network" position after Google. JumpTap is number four:
The IDC 2012 estimate was off, as you can see, by about $26 million (not bad as these things go). It might similarly be low for JumpTap.
Let's say that JumpTap's revenues will come in around $100 million for 2013. Add that to Millennial's $178 million and that's where the latter's 2013 revenue guidance likely comes from ($178 + $100).
There will undoubtedly be more mobile ad network consolidation in the next 12 - 24 months. For example I expect Yahoo to make an ad-related mobile acquisition. Microsoft may as well; and Facebook will probably buy more mobile startups. The mobile ad network space is even more more of a "winner take all" market than the PC network segment. Indeed, five or six companies in the US will take about 75% of global mobile ad revenue in 2013.
Millennial is in a sort of metaphorical "middle seat": neither big enough nor specialized enough. Accordingly it may be squeezed from "below" by specialist ad networks such as xAd and by programmatic buying. From "above," as mentioned, the company faces tough competition from Google and Facebook.
All that is why Millennial is going after larger scale and better data for more precision targeting. The risk remains, however, that despite JumpTap, Millennial might not be able to differentiate itself enough and lose out to more visible or "muscular" rivals.
Live Webcast: Wednesday, August 21st - 1:00pm ET / 10:00 am PT
One of the most profound developments in digital marketing, customer care and analytics is the advent of indoor location. While this new "industry" is in its infancy, it's impact will be profound over time.
Indoor location and marketing are being made possible by the mass adoption of smartphones and nearly ubiquitous public WiFi. But we're just starting to imagine what's possible: more personalized shopping experiences, better data on customer behavior, and greater visibility into what online and mobile ads actually deliver people to the point of sale.
Indoor location represents the true marriage of the online with the offline. Yet indoor location and marketing are still not well understood. Join Jon Rosen, EVP with iInside, and Greg Sterling, senior analyst with Opus Research, as they explore:
To say that Facebook's mobile ad revenue growth has been impressive is an understatement. It has been, what you might call, meteoric.
In the course of a 12 month period the company has gone from less than 10% of ad revenue from mobile to 41% in Q2 of this year. By the end of this year (or very early next) 50% of Facebook's ad revenue will likely come from mobile. (By comparison, in 2012 more than half of Twitter's ad revenues came from mobile.)
In Q2 '13 Facebook made more than $650 million in mobile ad revenue. If current trends continue expect Facebook to have a $1 billion mobile quarter by 1H 2014 (and possibly Q1 earnings). That would enable the company to claim a $4 billion annual mobile-ad revenue run rate.
Based on averages and simple math, Facebook made roughly $0.80 per mobile user in Q2 on a global basis -- up from $0.50 in Q1 of this year. However developed markets offer more revenue than emerging markets and so the revenue generated per mobile user will vary considerably from market to market in practice.
In 2010 we asked "How Long Before Facebook is a Mobile Ad Network?" and predicted that when Facebook turned on mobile ads it would immediately become the largest mobile "network."
As formidable as Facebook is becoming in mobile Google is still dominant globally. Incredibly, Mountain View is expected to capture more than 50% of mobile revenues on a global basis this year. Facebook claims a much smaller percentage of mobile revenues, but still ranks as the number two player in mobile advertising today.
Email vendor and small-business marketing services provider Constant Contact has released survey data (n=1,497 US adults) that show consumers increasingly expect to be able to read email on smartphones and other mobile devices. And if they can't they'll simply hit delete.
More and more email opens happen in mobile (numbers are creeping up over 50%) yet many marketers have not optimized their campaigns with this understanding. Nearly 90% of people between 18 and 30 read email on their smartphones. But perhaps the major finding of the survey is that "52% of consumers between 18 and 30 years old say their smartphone is now their primary email-reading device."
Regardless of age, however, consumers want to be able to open/read email on mobile devices. The survey found that older people also read mobile email: "66% of consumers over 60 open emails on a mobile device."
Here are additional top-level data from the survey:
The individual bullets are not as important as the overall message: e-mail marketers need to get really serious about mobile optimization right now.
As apps and websites become optimized for mobile commerce, and as the "credit card problem" is addressed (see TheFind and Jumio), there will be more buying on smartphones. Most retailers and brands currently assume smartphone transactions happen on the go or in stores (or on other devices). In the home e-commerce is supposed to be the domain of PCs (and increasingly tablets).
The conventional wisdom is that smartphones are more heavily used for shopping out of home and that's been supported by prior survey data. Yet data released yesterday by Nielsen tell a somewhat different and more nuanced story.
Americans are indeed buying things on their smartphones (24%) but they're mostly doing it at home: 72% of people making purchases on their smartphones did so at home and not "on the go," as one would have expected. Only 3% of smartphone owners buying things on their devices did so in stores; 6% did so in their cars. The remainder, 18%, fall into an unidentified "other" bucket.
It's interesting that smartphones are so widely used for commerce-related activities (store locators) on the go but buying happens at home. Nielsen doesn't offer any real explanation however. It may be that the "immediacy" and availability of the device make it a preferred option for some.
There's also no data about audience segments. It would be interesting to see if these at-home smartphone transactors are younger, older and whether they have other devices available to them.
Regardless this is another "wake up call" arguing that marketers and retailers need to quickly optimize e-commerce experiences for smartphones.
The reinvented 4INFO announced a deal with Acxiom this morning that is consistent with the way mobile and the broader digital advertising markets are evolving: advanced targeting and in-store/sales lift measurement.
According to the release, "The partnership provides US consumer brands new levels of mobile advertising precision and confidence for customer relationship campaigns, including the ability to measure results where it counts — at the cash register." Accordingly, companies will be able to use their own data to target existing customers (and prospects) on mobile devices -- and then track response to the point of sale and see direct sales impact.
Facebook has a similar product and relationship with Acxiom. At Facebook "Custom Audiences" allows companies to find and target their own customers on the site or in mobile. Catalina has a deal with 4INFO that leverages the former's purchase history data so that third party CPG companies and others can target buyers of specific products/product categories. But the 4INFO-Acxiom CRM-based targeting and sales measurement may be a first (other than Facebook) in mobile.
Behind the scenes the advertiser's CRM/customer data (or Acxiom audience data) are matched with 4INFO's database on a 1:1 basis. 4INFO claims profiles of 152 million mobile devices covering 101 million US households.
4INFO will also be making Acxiom audience segments data available to its "AdHaven Bullseye" advertisers. Most of the ad inventory 4INFO uses come from mobile exchanges.
It's worth repeating; what's significant about the announcement are the ways that it's a kind of harbinger of the future:
As I've argued elsewhere in-store/sales measurement will become an almost mandatory requirement of many mobile campaigns (depending on the objectives). There are now multiple companies including Placed, PlaceIQ, uSamp and others offering the capacity to measure in-store lift from mobile campaigns. Being tied into CRM databases offers even greater accuracy in terms of measuring sales impact.
Once these methodologies become more widely available and understood, advertisers will demand them. Placed and PlaceIQ will be talking about ad tracking to the point of sale and in-store measurement at Place 2013. The early bird conference rate expires this week. To take advantage register today.
The Pew Internet & American Life Project issued an online banking report (based on US consumer survey findings) earlier this week. Pew found that 61% of internet users said they banked online and 35% of "cell phone owners" also said they used their mobile devices to do some of their banking.
The total adult US internet population is roughly 200 million (give or take a few million). Using rough math and Pew's survey findings, that would mean approximately 122 million people were engaged in online banking in the US. Mobile phone penetration (including non-smartphones) among the US adult population is over 100% according to CTIA.
That means, using the Pew survey data, that roughly 83 million adults in the US are doing mobile banking. Although the percentages in the chart below seem far apart, the actual population numbers are much closer.
According to Pew younger, non-white US adults are more likely to do mobile banking than their white peers:
Young adults (ages 18-29) and whites report the most significant increases for online banking. In 2010, 55% of 18-29 year-olds said they banked online; in 2013, 66% of that group did so. In 2010, 47% of whites said they banked online; in 2013, 54% of that group did so.
Younger adults are also leading the mobile banking trend. However, in contrast with online banking trends, non-white cell phone owners are more likely than whites to engage in mobile banking.
What's interesting to consider is whether online banking will lead to more comfort with mobile bill paying generally and later mobile commerce and payments beyond that. However one factor here is that people mostly trust their banks, and their willingness to conduct financial transactions on mobile devices will depend (for now) on their relationship to the brand or provider in question.
Comscore has published Q2 e-commerce estimates for the US. I discuss those figures over at Screenwerk. The quarterly total is just under $50 billion ($49.8 billion). Of interest here are the "m-commerce" estimates provided by comScore: $4.7 billion in Q2.
Here's what the firm said about mobile e-commerce: "Consumers spent an additional $4.7 billion in mobile commerce (m-commerce) via smartphones and tablets, an increase of 24% over the past year." That means, according to comScore, m-commerce was about 9.4% of e-commerce spending, which is in turn about 5.5% of total US retail.
The firm doesn't detail what percentage of m-commerce is coming from tablets vs. transactions on smartphones. However there are relatively few e-commerce transactions completed on smartphones, though that is growing.
E-commerce on tablets is much like e-commerce on a PC; there is relatively little friction vs. the experience on smartphones. Indeed, most e-commerce sites have not done a good job optimizing their shopping experiences for smartphones.
I'm sure that comScore doesn't have this number but what would be most interesting is the dollar impact of smartphone usage on retail spending, either online or in the store. Smartphones now are an integral part of the shopping process and especially used in stores.
Siva Kumar, CEO of TheFind, told me earlier this week that 70% of the smartphone searches on TheFind's app are happening in stores. Accordingly smartphones are playing a major role in consumer decision making and having a much larger impact on purchase decisions than the still-modest "m-commerce" figures would suggest.
Android's share (of smartphone shipments) across the globe is gaining momentum according to the latest IDC numbers. By contrast there's evidence that Android's US share may have "peaked" according to analysis from Asymco's Horace Dediu.
Below are IDC's estimates showing global market share for Q2 by shipments:
Thus Android stands near 80% of global smartphone shipments, which aren't identical with sales. But it's a directional indication of actual sales.
However in the US market the story is different; Android's share is flat (per comScore):
Dediu points out that over the past six to eight months in the US the iPhone has gained more usage than Android (11M vs. 6.6M users). So it would appear that Apple's US and international fortunes have significantly diverged.
However we also have research from CIRP, which finds (via survey data) that "first time smartphone buyers" in the US (meaning those buying smartphones for the first time now) tend to be older and more price sensitive. They buy "secondary Android brands" (e.g., LG) and keep their phones longer.
Apple's strategy for more price-sensitive consumers has been the iPhone 4 and 4S, which has been reasonably successful to date. However rumors suggest a low-cost "plastic" iPhone for emerging markets and more price-conscious consumers.
When looked at in the context of overall computer operating systems (including the PC), Android will be the dominant OS by 2015 on a global basis -- far outstripping Windows. By comparision, Apple's overall OS share (iOS + Mac OS) is expected to nearly match Windows.