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Announcing Place London, The Business Summit on Indoor Location

is proud to announce that Place, the premier global venue for education, opinion and partnership development for the indoor location industry, will be hosted in London, England on November 17, 2014 at the Tower Hotel.

Place London offers a unique opportunity to learn, discuss and strategize how indoor traffic analytics, combined with mobile and online data, empowers business intelligence and consumer engagement.

Among the many topics for discussion at Place London 2014 include:

Report: Survey of U.S. Retailers' Use of Indoor Location




Recently, surveyed a group of U.S. retailers — from Big Box, specialty store, grocery, electronics, department stores, convenience stores and more — to determine current trends and market perceptions regarding in-store marketing and indoor analytics. With a significant majority of consumers using smartphones in store (83% according to study in Q3 2013), this survey revealed a high degree of interest from retailers in developing indoor analytics strategies but considerable confusion in understanding indoor location technologies and justifying a demonstrated return on investment.

To download and view this groundbreaking survey, click the link below:

Survey of U.S. Retailers' Use of Indoor Location

Featured Research is available to registered users only.

For more information on becoming an I2G client, please contact 1 ().

Beacon Case Study Shows Brand Content Equal to Offers for Driving Purchases

Agency BPN, together with inMarket, presented a Hillshire Brands in-store beacon marketing case study at the Place Conference in New York two weeks ago. This was the first time a national brand beacon case study had been presented publicly.

The company sought to build awareness, among 25 to 54 year olds, for its new "American Craft Sausage Links" -- with digital media exclusively. Hillshire worked with BPN and inMarket, leveraging the latter's shopping apps and its in-store iBeacon network.

Among other digital exposures, mobile users were shown geofenced display ads for the product near stores. These display ads invited users to add the product to an in-app shopping list. Once in grocery stores with beacons, smartphone users were sent a notification about where to find the product ("meat aisle").

In stores, smartphone owners were shown ads/content that featured offers or incentives to engage with and try the product. Others were shown pure awareness messages and branded content that didn't have an associated offer. 

BPN reported that the ads worked equally well. Indeed, pure content/awareness ads drove the same level of engagement and purchase intent as the offer-based ads. This is a major finding: brands don't need to offer coupons or deals to drive consumer purchase behavior. 

Overall the campaign was very successful. Roughly 1% of shoppers going in had any intention of buying the brand's link sausage. After exposure to the campaign purchase intent shot up to north of 21%. Brand awareness was boosted 36% according to BPN. 

This is an early proof-of-concept for in-store marketing and shows its significant potential to generate brand awareness, purchase intent and sales lift. Many billions of dollars are spent annually by CPG companies in grocery stores but rarely achieve these results. 

Accordingly this case study should cause brand marketers of all stripes and types to get going and start testing indoor and in-store marketing before their competitors beat them to the register. 

GameStop Tests Beacons in-Store but with a 'Pull' Twist

GameStop is the latest retailer to implement beacons in-store. Supplied by Shelfbucks (which spoke at the Place Conference), the company is testing in-store marketing in its Texas stores with the expectation that it will roll beacons out to 100 stores nationally by year end.

They will deliver "real-time promotions, ratings and reviews to the smartphones of consumers walking through the aisles of its shops," according to an article in the Wall Street Journal. The twist is that the implementation will be more of a "pull" scenario than the more conventional "push" model associated with beacons.

Users will be directed to signs on shelves that will offer promotions and product information when they get close enough. Technically that information will still be "pushed" to them via GameStop's app. But they'll have to approach the beacons, which will be clearly marked.

Essentially it's an opt-in, "pull" model not very conceptually different from scanning a QR code on in-store signage. However message delivery won't require QR-code scanning effort by the consumer. 

The article also says that GameStop intends to deliver personalized promotions to in-store shoppers "based on their purchase history, titles in their product 'wish lists' and their game libraries."

Our surveys and those of third parties have well established the point that consumers will willingly participate in these programs if there's transparency and a value exchange. The prospect of relevant content, reviews and promotions, in this case, will be sufficient to gain most GameStop customers' voluntary participation and engagement.

Mobile Ad Acceptance, Engagement Have Improved Dramatically Since Last Year

The third Mobile Path-to-Purchase study (US) from Nielsen, xAd and Telmetrics is out. The data come from a mix of survey findings and behavioral observation from Nielsen's smartphone panel.

The big messages of the study are:

  • Mobile ads are now more accepted and seen as less annoying, with a big improvement since last year 
  • Consumers would rather have ad-supported content than pay for content on mobile devices
  • Though there's still a high percentage (40%) of accidental clicks, those who intentionally click and engage in "secondary actions" are highly interested, valuable potential purchasers  
  • Coupons/offers and local relevance are the big drivers of mobile ad engagement

    As one sign that the quality and relevance of mobile ads in the US are improving, 47% of study respondents had a positive view of advertising on mobile devices compared with 22% last year. 

     Attitudes toward mobile ads

    While there was a 40% accidental click rate, those who intentionally clicked on ads and engaged in secondary actions were more likely to purchase within a very short period of time. Just under half (47 percent) of those who clicked on a mobile ad took some form of secondary action:

     Mobile ads secondary action

    More than 70% of those who took secondary actions were "looking to make a purchase within the same day." This plays into the conventional industry observation that people on mobile devices are more "ready to buy" than shoppers on PCs. This is not always true but seems to be as a crude generalization. 

    . Mobile ad engagement

    Perhaps most interesting was the finding that coupons and local relevance were the biggest drivers of mobile ad clicks. Coupons had a greater impact among those under 40, while local relevance became a more important variable for those over 40. These trumped ads that featured a known brand. Imagine how well an ad that featured a known brand, offered a deal and were locally relevant would perform. 

    Coupons vs. local relevance in mobile ads

    There's also an infographic that features additional data and findings. 

    Place 2014 - Agenda and Presentations

    Place 2014, the leading industry event produced by and held July 22 in New York City, brought together a range of developments and ideas: indoor location, online-to-offline tracking, and proximity-based mobile marketing. The agenda and presentations below reflect the what’s next for indoor location with perspectives and expertise from brands, retailers, agencies, technology providers, regulators, and investors.

    Place 2014 Sponsors

    Agenda & Presentations

    9:00 AM - 9:15 AM
    The Place-Based Moment - senior analyst will present new data and original research on in-store consumer behavior, the “privacy paradox” as well as merchant demand for offline analytics and in-store marketing.
    Speaker: , Senior Analyst,
    View slides from this presentation

    9:15 AM - 9:45 AM
    The Agency Perspective - Michael Lieberman is Co-President of Joule US, where he oversees the expansion of Joule’s East Coast business. Based in New York, Michael heads up teams responsible for delivering mobile strategy, media and creative services that produce effective mobile campaigns for world-famous brands including AT&T, Dell, Colgate, and Ikea.
    Michael Lieberman, Co-President, Joule US

    9:45 AM - 10:25 AM
    The Indoor Technology All-Stars - Google’s Don Dodge will lead a discussion with companies representing the full range of indoor location technologies, from WiFi to BLE beacons and LED lighting. From cost, accuracy and analytics perspectives, which technologies are “must haves” and which ones are “nice to haves”?
    Nathan Pettyjohn, Founder & CEO, aisle411
    Chris Goodall, Founder & CEO, Trusted Positioning
    Dan Ryan, Co-Founder & CEO, ByteLight
    Steve Cheney, SVP of Business and Operations, Estimote
    Don Dodge, Developer Advocate, Google (Moderator)

    10:45 AM - 11:15 AM
    Ahead of the Curve: Alex and Ani - Alex and Ani’s Digital Strategy VP Ryan Bonifacino discusses the insights and opportunity that led the jewelry retailer to test and then rapidly deploy indoor location to all its stores across the U.S. – well ahead of its retail peers.

    11:15 AM - 11:30 AM
    Indoor Atlas and Magnetic Positioning
    Wibe Wagemans, President, IndoorAtlas
    View slides from this presentation

    11:30 AM - 12:10 PM
    Connecting the Dots: How Location and Offline Analytics Will Transform Digital Marketing - Offline location data and analytics will deliver huge dividends to retailers, ad networks and marketers in general. They will enable better visibility into campaign effectiveness and permit new levels of personalization and targeting. What will this new world of integrated data look like and how will it change digital and traditional marketing?
    Juha Mattsson, VP, Marketing & Sales, Walkbase
    Anne Marie Stephen, VP of Sales, iInside
    Maria Fernandez Guajardo, VP of Products, RetailNext
    Luke Edson, VP, Sales, YP
    , Senior Analyst, (moderator)

    12:10 PM - 12:25 PM
    Case Study: SK Telecom - John Kim, Senior Business Development Manager with SK Telecom, will discuss multiple deployments of indoor location technology in the South Korean market.
    View slides from this presentation

    1:30 PM - 2:00 PM
    Featured Speaker: Facebook - Doug Stotland is in charge of local solutions for both small and large businesses marketing on Facebook. Prior to his current role, Stotland worked on marketing science, pricing and building Facebook’s teams across Asia and the Pacific. Stotland will discuss Facebook's varied and creative efforts to track and measure the offline and in-store impact of Facebook advertising.

    2:00 PM - 2:15 PM
    Beacon Location Security & Encryption
    Jimmy Buchheim, CEO, StickNFind
    View slides from this presentation

    2:15 PM - 2:55 PM
    Indoor Location & Privacy: Steering Clear of the ‘Creepy Line’ - Jules Polonetsky, Executive Director and Co-chair of the Future of Privacy Forum, will guide a diverse panel of industry observers, marketers and experts through treacherous waters: how to drive engagement without crossing the “creepy line.” What are the issues and emerging best practices? And will the “surveillance” backlash derail merchant adoption of indoor location?
    Maya Mikhailov, EVP and Co-Founder, GPShopper
    Amanda Koulousias, Attorney, Federal Trade Commission
    Kate Kaye, Writer, Advertising Age
    Eloïse Gratton, National Co-chair, Privacy Practice Group, McMillan LLP
    Jules Polonetsky, Executive Director, Future of Privacy Forum (Moderator)

    2:55 PM - 3:10 PM
    Hillshire Brands, inMarket and iBeacon - Agency BPN will present a new case study showcasing how beacons and geofencing are driving purchase intent, brand awareness and sales for Hillshire Brands.
    Chris Hiland, Chief Strategy Officer, BPN
    Todd Dipaola, CEO & Founder, inMarket
    Presentation coming soon

    3:25 PM - 3:40 PM
    Best Practices for Consumer Push Notifications
    Scott Townsend, Director of Agency Programs, Urban Airship
    View slides from this presentation

    3:40 PM - 4:20 PM
    Street, Store or Shelf: Rightsizing the Consumer Experience - Indoor location and proximity marketing allow retailers, networks and brands to put marketing messages in front of consumers at strategic points in stores, malls and other venues. But just because it can happen doesn’t mean it should. What’s most effective in geo-fencing and proximity targeting? When is it best to engage consumers and how do we avoid creating more ad clutter and noise?
    James Smith, Chief Revenue Officer, Verve
    John Dempsey, Head of Mobile and Video, Datalogix
    Catherine Lindner,Chief Merchant Officer, Shelfbucks
    Asif Khan, Founder & President, LBMA (Moderator)

    4:20 PM - 4:35 PM
    Comparing Indoor Location Technologies - GISi Indoors will discuss the company’s real-world comparisons of multiple indoor location technologies, its findings, implementation experiences, when and when not to use it and conclusions.
    Michael Healander, General Manager, GISi Indoors
    View slides from this presentation

    4:35 PM - 5:15 PM
    Whither Geofencing: What Is the Future of Mobile Location? - Location is now often used for mobile audience discovery and profiling rather than for real-time location targeting. In some percentage of cases, location thus “disappears” into the background and becomes a proxy for behavioral and demographic information. How far will this trend go? What role will “geo” play in the future of mobile marketing and advertising? The panel will explore these and other provocative questions about the future of location and place-based marketing.
    David Shim, CEO & Co-Founder, Placed
    Eli Portnoy, President & General Manager, Thinknear
    David Staas, President, NinthDecimal
    Sarah Ohle, Director of Marketing Intelligence, xAd
    Bill Michels, SVP of Product & Partnerships, Factual
    , Senior Analyst, (Moderator)

    Facebook and Twitter Q2: Large Majority (over 60%) of Ad Revs from Mobile

    Last week Facebook released very favorable Q2 2014 earnings. Today Twitter followed with an impressive quarter of its own, handily beating financial analysts' estimates. In after hours trading Twitter is up more than 30%. 

    Below is a recap of all the relevant mobile numbers from both releases. 


    • Total revenue: $2.91 billion
    • Total ad revenue: $2.68 billion  
    • Mobile ad revenue: 62% or $1.66 billion 
    • Mobile monthly active users: 1.07 billion (vs. 1.32 billion total) 
    • Mobile daily active users: 654 million (v. 829 million total) 

    Facebook made, on average, $1.25 in Q2 ad revenue per monthly active mobile user.


    • Total revenue: $312 million
    • Ad revenue $277 million
    • Mobile ad revenue: 81% of total or $224 million 
    • Mobile active users: 211 million (out of 271 monthly active users total)  

    Twitter made, on average, $1.06 in Q2 ad revenue per mobile active user.

    What's remarkable is that two of the largest US internet companies gain well over 50% of their ad revenues -- in Twitter's case it's over 80% -- from mobile distribution. This is both a metaphor for and direct evidence of the importance of mobile. 

    Unlike many of their peers, Facebook and Twitter are platforms/publishers much more directly aligned with their users' behavior.  

    Saks Fifth Avenue Parent the Latest Retailer to Roll Out iBeacons

    The largest iBeacon retail rollout to date is the one announced earlier this year by American Eagle Outfitters. The company said it will put iBeacons in all 100 stores across the US. However it's not clear where that stands at the moment. Walgreens, Safeway, Alex and Ani and several other retailers have also deployed Bluetooth beacons to varying degrees in their stores. 

    This morning Hudson's Bay Company said it joing the club. The retailer, which also owns the Lord & Taylor and Saks Fifth Avenue chains, said it will roll out beacons (with Swirl) in selected stores in Boston and Toronto:

    HBC Department Store Group is deploying the Swirl in-store beacon marketing platform to deliver digital experiences to consumers’ smartphones while they shop in the company’s department stores in Canada and the US. Using beacons installed in merchandising areas throughout its stores, Hudson’s Bay and Lord & Taylor will automatically deliver branded content and personalized offers to in-store shoppers through an array of company-owned and third party mobile apps.

    The stores will deliver messages via their own mobile apps through Swirl. Though Swirl still has limited visibility among most consumers, it's clear that retailers must pursue a multi-pronged strategy with smartphone shoppers. They need a combination of their own apps and some third party distribution or marketing to build in-store smartphone audiences. 

    One related development that's very promising for retailers, which generally don't see high app-penetration rates, is the prospect of GPS-enabled mobile browser-based notifications. I wrote about this development earlier today. A company called Roost has developed push notifications for the web and will soon roll them out to mobile browsers.

    This would enable retailers (and others) to get users on the PC to opt-in to notifications, which could potentially later be sent to nearby and in-store customers through the browser, even though those users don't have the retailers' apps on their phones. While this isn't yet available it's a potentially big deal for retailers.

    My understanding is that BLE beacon signals wouldn't be receivable by these non-app browser users. Nonetheless, browser-based notifications could be used as a "fall back" or alternative way to message in-store consumers for those who don't have the retailers' apps. 

    Survey Reveals Most Common Reasons Consumers Use Merchant Apps

    A new survey about digital wallet usage from Thrive Analytics also contains findings about why consumers download and use merchant apps. While nearly 90% of time with mobile is spent "in apps," most consumers don't have many (or any) retailer apps on their phones.

    This is something of a paradox and a major gating factor for indoor location and marketing. Unlike mobile wallet usage, foundational consumer behavior for indoor marketing is already well established: between 70% and nearly 90% of smartphone owners use their devices in stores already. 

    However to leverage indoor location and improve the in-store experience, using mobile, apps are required. That's the challenge for retailers. 

    The chart below reflects what the Thrive survey (n=2,038 US adults) found about the reasons that smartphone owners use merchant apps:

    Source: Thrive Analytics, July 2014 (n=2,038)

    To some degree this list reflects what's possible in retail apps today. I believe however that merchants must make their apps much more utilitarian in terms of the in-store experience than they currently are. Using indoor location retailer apps can recognize that consumers are in a store and transform from an e-commerce centric experience to one that focuses on common consumer needs in the store. 

    This includes offering more in-store product information, maps and the ability to pay using an app. To the extent that retailers can further develop their apps as in-store assistants and incorporate payments they will give users much more reason to download and retain them.

    Preview of Place Conference 2014

    When we launched the Place Conference late last year we felt that the time was ripe to hold an event that started to engage discussion around indoor location. But not simply indoor location; we wanted to "connect the dots" between indoor location, broader mobile marketing and online to offline tracking and attribution.

    The first Place Conference in San Francisco was a unique event and a big hit. Roughly eight months have elapsed since that time and tomorrow's Place 2014 event reflects the rapid evolution of the market. We're at a moment when mobile marketing is really starting to take off -- expectations are that mobile advertising in the US will be north of $15B in 2014 -- and whe consumers are using their smartphones as shopping assistants in ever larger numbers.

    Tomorrow's event at the W Hotel in Union Square will feature a range of speakers and and attendees who don't usually come to the same conferences: agencies, retailers, brands, technology companies, investors, lawyers and representatives of non-profits and government. 

    Here's the very packed agenda (and my shorthand): 

    • The Place-Based Moment: , Senior Analyst, (consumer research and market sizing)
    • The Agency Perspective: Conversation with Michael Lieberman (agency perspective on the state of mobile and indoor location)
    • The Indoor Technology All-Stars with Don Dodge (array of providers discussing their capabilities)
    • Ahead of the Curve: Alex and Ani - Ryan Bonifacino, VP of Digital Strategy (why one retailer went all-in with indoor location early)
    • IndoorAtlas and Magnetic Positioning (an indoor technology that doesn't require hardware that you may not have heard of)
    • Connecting the Dots: How Location and Offline Analytics Will Transform Digital Marketing (indoor analytics and how it will impact digital broadly)
    • Case Study: SK Telecom (multiple use cases from South Korea)
    • Featured Speaker: Facebook’s Doug Stotland (how the company is connecting the dots from online to offline)
    • Beacon Location Security & Encryption (best practices for iBeacon and BLE)
    • Indoor Location & Privacy: Steering Clear of the ‘Creepy Line’ (experts discuss how to handle mobile location, indoor location and consumer privacy)
    • Hillshire Brands, inMarket and iBeacon (the first national brand case study using iBeacon)
    • Best Practices for Consumer Push Notifications (Urban Airship shares best practices from its many billions of campaigns)
    • Street, Store or Shelf: Rightsizing the Consumer Experience (what's going to work and how to avoid spamming consumers)
    • Comparing Indoor Location Technologies (an objective comparison of indoor location technologies for brands, retailers and agencies)
    • Whither Geofencing: What Is the Future of Mobile Location? (a forward looking discussion about location and mobile advertising)

    If you're going to be in the room you'll be immersed in discussion about the future of mobile, location and offline attribution. These trends are coming together with profound implications for all digital marketers and brands. It's going to be an exhausting yet exhilarating day. 


    Lines and Cash Are Two Big Payment Pain Points for Consumers

    PayPal recently released survey data on e-commerce and mobile payments. There were more than 15,000 respondents from a range of countries: Australia, Brazil, Canada, China, France, Germany, Israel, Italy, Japan, Russia, Singapore, Spain, Turkey, UK and the US.

    The survey identifies arguably the two major offline payments "pain points" for consumers: 1) waiting for their payments to be processed (or waiting in line) and 2) having enough cash on hand (less true in Western markets).

    Payments pain points paypal

    PayPal found that the hierarchy of "can't leave home without" items was as follows:

    • Keys -- 34%
    • Phone -- 24%
    • Credit cards -- 21%
    • Cash -- 20%

    The survey also asked about friction or frustrations with to e-commerce: "Which of the following, if anything, annoys you about online payments?"

     E-commerce pain points

    The responses vary by country but this is the list: 

    • payment security
    • registration requirements
    • hidden charges/taxes
    • entering credit card numbers
    • malfunctions in the middle of transaction
    • passwords and pin numbers

    The survey also inquired about time spent shopping -- this is self reported data but with a roughly 1K per country sample. The question asked how many hours per week were spent shopping offline vs. online.

    In China more time was spent online and in Brazil the time spent was identical (very hard to believe). The UK is nearly 1:1 but the US favors offline by about 2.5X. I would take these numbers not as actual but as directional indications of time spent. For example, is grocery shopping included here? It's not clear.

     Time spent shopping online vs. offline

    In my view the most interesting findings are reflected in the top chart about the challenges and frustrations of traditional offline payments. There's great opportunity in minimizing payment wait times and enabling people to avoid lines. This is starting to happen as in-app/mobile payments are currently being deployed in fast-food and "fast-casual" restaurants and in a few fine dining establishments with the OpenTable app.  

    Retailers also have a major opportunity with mobile payments. Loyalty and payments are two features that would help them generate app downloads and repeat usage. It would also provide them with additional tracking tools, not to mention "closed-loop" ways to market to their customers. 

    Currently most retail apps are sort of mini e-commerce sites. By contrast, they need to create apps that either contemplate the majority of usage being nearby and in-store, and make changes to the user experience accordingly, or have context-sensitive apps that can change when a user comes into a store. 

    Report: M-Commerce on Track to Hit $50B This Year

    Custora released some new data on mobile e-commerce drawn from “over 100 online retailers, 70 million consumers and $10 billion in transaction revenue.” Based on transaction volume to date in 2014, the company predicts that mobile e-commerce will hit $50 billion by the end of the year.

    Based on US Census Bureau data, total US e-commerce is likely to be in the range of $280 to $290 billion this year. 

    Custora says that roughly 37% of visits to e-commerce sites in the US are now coming from smartphones and tablets. Apple devices currently drive the highest transaction volume but Android is gaining, chiefly in the form of Samsung devices and “forked” Android Kindle Fires from Amazon.

    The Kindle Fire phone is poised to be a mobile commerce powerhouse if it sells. However it lacks mainstream appeal in my view. 


    Apple’s over share of m-commerce declined from 75% in 2012 to 51% in Q1 2014 according to Custora data. Among tablets the iPad still dominates, driving roughly 80% of all e-commerce from tablets. Samsung tablets were responsible for 15% of tablet based e-commerce and Kindle tablets drove about 4.5% says Custora.

    Perhaps the most interesting finding from Custora is that email generated 27% of m-commerce transaction volume in the quarter. These were users “responding to email marketing and shoppers going directly to e-commerce sites (including app traffic).” By comparison, email marketing drove 21% of PC based transactions and 23% of tablet-based e-commerce. This strongly argues for immediate optimization of email for smartphones.

    Custora says that social media basically didn’t drive mobile transactions. The company said “social media accounted for only 0.6% of sales on phones and 0.2% on tablets.”

    Over 57% of US Homes Have No Landline or Don't Use the Landline

    New data from the National Health Interview Survey (NHIS) from the National Center for Health Statistics, now reflect that 41% of US homes have no landlines -- only mobile phones. These data are from the period July 2013 through December 2013.

    The report goes on to say that almost 34% of households with both landline and wireless phones "received all or almost all calls on wireless telephones." These mostly wireless homes represent 16.1% of all US households according to the NHIS. 

    Together the two categories of wireless only or mostly wireless homes constitute 57.1 percent of all US households. Either the landline doesn't exist or it's mostly a spam catcher for telemarketing and other unwanted calls.

    There are regional and demographic differences in the data. The poor were much more likely to be mobile only and so were younger adults. The Midwest was the region that (barely) had the most mobile only households with 43.7%. The Northeast had the least at 24.9%. 

    According to NHIS, growth of mobile-only homes has slowed vs. previous years. Thus growth of mobile-only homes may be near a plateau. 

    Tiny Collection of Apps Dominating the Mobile Universe

    Yesterday Nielsen released data (which has strangely now been pulled from the site) showing that smartphone users were spending about 30 hours per month in Q4 2013 on mobile apps. That was up from just over 23 hours in the previous . . . quarter? year?. The chart below isn't clear on the comparison time frame. 

    What's most interesting is that while time went up the average number of installed apps did not. Users on average had just under 27 apps on their handsets. That number was basically flat.


    Interestingly, in May 2012, Nielsen reported that the average US smartphone owner had 41 apps on his/her phone vs. 32 apps in 2011. So either the calculation above is incorrect or the number of retained/active apps has declined. 

    The following is comScore's top 15 US apps list for April 2014 (the most recent data available):

    The internet -- as represented by apps, which now take up 51% of digital media time -- is shrinking. The list of top mobile ad revenue recipients is even shorter than the top apps list.

    Forget the percentage specifics in the chart below; the point is the list itself. Google, Facebook, Twitter and Pandora are all "publishers," though in all but Pandora's case they're ad networks too. YP is a publisher but on the list as an ad network. Millennial Media is also a network. 

    If we look at all these data together what we see is a mobile app universe dominated by a tiny collection of apps vs. the total universe of 1.2 million iPhone apps. An even smaller number of publishers/networks collect the majority of mobile ad revenue.

    Google Project Tango and aisle411 Team Up for Augmented Reality Shopping

    Project Tango is Google's new 3D mapping technology. It uses the smartphone's camera, gyroscope and accelerometer to do indoor mapping (based on SLAM -- simultaneous localization and mapping).

    This approach doesn't require additional hardware installation (even Beacons). It just requires smartphones to do the initial mapping. It's one of three or perhaps four such approaches now emerging. Others include Indoor Atlas and FlyBy Media (a Tango partner). 

    At Google's developer conference I/O last week the company was showcasing various uses of Tango, one of which was in a retail environment through a partnership with aisle411. The latter implemented Tango in Walgreens to generate in-store augmented reality (AR) shopping experiences (see video below). 

    Product locations are married to a store map, created using the Tango technology. Using a smartphone or, in the video, a tablet fixed to a shopping cart, the end user can see product locations, map shopping lists to a floor plan and see enhanced product information or coupons "pop up" on the screen. 

    Aisle411 says the technology allows for accuracy "within centimeters." This is a pretty interesting variation on some of the indoor location scenarios we've been discussing and exploring. However one question is whether stores will equip shopping carts with tablets, which could be expensive and risk theft. On the other hand this AR experience is potentially less satisfying and effective on a smaller screen smartphone -- users are unlikely to hold them out as they walk down store aisles. 

    Regardless it's a pretty interesting marriage of digital and real-world experiences in a shopping environment. Aisle411 will be speaking on the indoor location technology panel at next month's Place Conference on July 22 in New York. 

    The Outlook for (Monetizing) Wearables

    Before we can truly discuss the outlook for wearables we need to see Apple's iWatch and how much it costs. There are already a dozen or so smartwatches in the market, chief among them the Pebble and Samsung devices. Most of them have already failed.

    The Pebble is a qualified success. However, there is really only one truly desirable smartwatch coming to market so far -- and we don't yet know the pricing. That's the Moto 360. 

    The Samsung and LG watches ($199 and $229 respectively) shown off at the Google developer conference this week seem like decent but not great devices. As fashion items they leave much to be desired. I haven't yet used them so I can't comment on the experience. I have the Samsung Galaxy Gear Live (Android Wear). 

    Nielsen reported yesterday that it tracked a "surge" in wearables adoption (fitness trackers and smartwatches) and usage between September 2013 and February 2014. The company added that "these wearable owners used their devices an average of 14 times during the month." The measurement firm also observed that smartwatch owners log a lot of time monthly accessing the internet and content on those wrist devices: 


    There's a question about whether the time is additive to existing mobile device usage or whether it cannibalizes some of that time. Regardless, the data above are very interesting, suggesting that with the right devices (mix of fashion + function + price) wearables could become a mainstream reality with fairly high engagement and diverse use cases.

    The next obvious question about wearables surrounds marketing and monetization. Ad exchange TapSense announced earlier this week that it would be supporting delivery of ads to smartwatches. Those ads will likely follow the same pattern as early mobile display advertising: lackluster or perfunctory ad creative and weak or awkward overall experiences.

    Most companies won't build anything like landing pages optimized for wearables. And most of these early ads will probably be for other app downloads. 

    More likely to be effective are app-based notifications. For a long time SMS marketing held promise as a loyalty and location-based notifications tool. Today that promise has largely faded. However wearables may offer another go at that opportunity.

    Consumers could, for example, opt-in to receive location-based notifications -- including indoor alerts -- that might contain marketing content (awareness or DR calls to action). This approach is probably going to be more effective and less awkward than ads within tiny apps on your wrist.

    Paradoxically apps with ads that are too small to be noticed won't be effective and ads that are too large are likely to annoy. As "personal" as the smartphone is a watch is going to be even more personal in some respects -- and thus people may be less tolerant of conventional advertising on these devices.

    Search content/ads may be an exception. Still you can't show many ads on a 2.5 inch screen. 

    If Ad Spend Matched Time Spent Mobile Ads Would Be Worth $29B This Year

    Earlier this week comScore reported that mobile devices (smartphones + PCs) were responsible for 60 percent of total digital media time in the US (chart at right). Traditional TV is still the king in the US in terms of overall consumer time spent. 

    More specifically, comScore said that US users spend 51% of all their digital media time in mobile apps. The firm reports roughly 83% of mobile media time is app-based (vs. the mobile web). Nielsen puts the number at 89%. 

    I spoke to comScore at some length about these numbers. We agreed that ad dollars would eventually follow the consumer traffic migration. The question is how long it might take. For the past few years mobile ad spending in the US has roughly doubled YoY (per the IAB):

    • 2011: $1.6 billion
    • 2012: $3.4 billion 
    • 2013: $7.1 billion 
    • 2014 (projection): $14 to $15 billion 

    Total digital ad revenue in the US for 2014 will probably be around $49 billion. If time spent and ad spend were aligned mobile would capture more than half of that number (and in-app advertising the bulk of that). Accordingly mobile ad revenue would be $29.4 billion and PC ad revenue would be $19.6 billion. 

    That would be radical.  

    Price Matters: Amazon Fire Blew It, Will the iWatch Learn from That Mistake?

    There were early, hopeful rumors that Amazon's smartphone would be free. What a radical move that would have been.

    That free rumor was quickly quashed by Amazon. Indeed, when it showed up last week the Fire phone was priced like an iPhone: $199 with a two year contract or $650 unlocked. I was very surprised by this "premium" pricing. 

    Amazon CEO Jeff Bezos feels he's developed a premium phone and that consumers will also see it that way. True, Fire does have a number of stand-out or innovative features:  

    • 13MP rear camera
    • Firefly: Shazam for the real world.  
    • Unlimited, free cloud photo storage
    • Deep integration of the Amazon content and services ecosystem 
    • Free “MayDay” video customer service
    • Dynamic perspective: a kind of 3D experience on the home screen and for games
    • Free year of Amazon Prime for new customers

    Yet one can't escape the feeling that this device has been designed almost entirely to promote Amazon, its content and e-commerce. The user is somehow secondary or merely a vechicle for the realization of Amazon's broader mobile ambitions.

    The early reviews have been very mixed. Consequently few iPhone buyers will switch and the same is probably true for those loyal to Samsung Android devices. Amazon's loyal customers are the likely buyers of this handset. While that's millions of people it's not enough to make the phone a true hit. 

    Had the phone been more aggressively priced, as the Kindle Fire tablet was when it launched, the story would be very different. In all but a very few cases price matters. An unlocked $199 Fire or, ideally, unlocked $149 Fire would generate significant sales. Then, I believe, Amazon would have had a massive potential hit on its hands. 

    Consider that Motorola sells the 4G Moto G Android phone for $179 -- unlocked. Between the Amazon phone and the less flashy but still well-equipped (and much cheaper) Moto G, the choice is obvious: Moto G. 

    As with the Fire, now destined for disappointing sales absent a price cut, the price of Apple's forthcoming iWatch matters. The device (or devices) will be released, according to reports in October.

    Financial firm Piper Jaffray surveyed 100 people (too small a sample) and asked about interest in a $350 iWatch. Apparently only 14% (or 14 people) said they were willing to buy a $350 iWatch. The survey extrapolates limited demand from those findings. 

    The conclusion of that there's only limited interest in smartwatches is wrong. There's considerable interest in the market. Surveys by , Nielsen and others suggest a potential market in the US of more than 100 million people. There are two key variables however: design and price.

    The Samsung Galaxy Gear watches failed not because of price ($299) but because they were ugly and poorly designed. We can expect Apple's iWatch(es) to be well designed but the price is an issue.

    If Apple can price these devices below $300, and preferably below $250, they're likely to see considerable sales volume. But above $300 the market will be more limited, as the Piper Jaffray data suggests.  

    Apple needs another hit product so it would do well to take a lower margin on the iWatch in favor of boosting sales and making it more accessible and affordable for a larger population.  

    Beacons Found to Increase App Usage and In-Store Engagement by Nearly 20X

    Beacon marketing provider inMarket released some data drawn from its shopper/store base that show Beacons and associated content/offers can increase app usage, retention and brand engagement.

    The company looked at a sample of 25,000 in-store shoppers across its app network during April-May of this year and found the following averages:

    • Interactions with advertised products increased by 19x for users who received a beacon message.
    • In-store app usage was 16.5x greater for users who received a beacon message.
    • Shoppers who received a beacon message were 6.4x more likely to keep an app on their phone, versus those who do not.

    These findings reinforce others that already exist and highlight the potential to improve the in-store experience and boost sales both for retailers and brands.

    We'll get a drill down and more in-depth look at in-store Beacon usage/engagement data from inMarket partner Hillshire Brands and its agency BPN Worldwide at the Place Conference coming up July 22 in New York.

    This kind of data is a counterweight or argument against the notion that consumers are hostile to indoor location, which several surveys and media reports seek to portray.

    Mobile Ad Revs Over $2B in Q1, Could Hit 30% of Total for 2014

    This morning the IAB put out a press release that reported $11.6 billion in digital ad revenue for the first quarter of 2014. However the trade association did not indicate how the numbers were broken down by channel and category. 

    In 2012 mobile advertising represented 9% of total US digital ad spending. In real dollar terms that was roughly $3.3 billion. In 2013 mobile advertising grew to be 17% of total digital ad revenue or nearly $7.1 billion. 

    Mobile advertising could double again in 2014 and reach between $14 billion and $15 billion. If so, by my calculation, it would represent nearly 30% of total US digital ad revenue -- assuming a full year 2014 projection of roughly $49 billion.

    In Q1 mobile ad revenues were probably in excess of 20% of the total. In Q4 2013 they were 19% (though 17% for the full year). At 20% mobile ad revenue would represent $2.3 billion of the Q1 2014 $11.6 billion.