Ad Networks

Report: Mobile Time Spent More than TV Globally

Ad network InMobi today released what it’s calling the "first wave” of a mobile media consumption study spanning 18 countries and 20,000 consumer-respondents. The results, generated in Q4 of 2011, were not broken down by region or country however.

Accordingly they should be seen as global averages and are relatively less meaningful. However they have symoblic value in highlighting the rise of mobile.

InMobi says that time spent with mobile now trumps TV: 

  • Mobile: 27% of media time 
  • TV: 22% of media time
  • PC-online: 32% of media time

Again, these figures are global. So in any individual country the data may look very different. Indeed, data from Flurry Analytics and other sources contradict the findings above for the US market, with TV capturing almost twice the amount of media time spent as mobile. 

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In addition, according to Flurry (drawing upon third party data as well), time spent with mobile apps now trumps PC-online. That contradicts the InMobi finding above in the context of the US market once again. 

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What's clear is that users are spending more time with mobile and the mobile Internet. The InMobi findings are thus directionally accurate across countries/regions. 

InMobi also reported that “66% of mobile users are just as comfortable with mobile advertising as they are with TV or online advertising.” That may well be in many instances. However a recent UK and US survey from YouGov found something quite different.

Consumers were much less tolerant of ads on mobile phones than in other media: 

[The] Digital Advertising Attitudes Report warns that consumer openness to advertising is lowest on mobile phones versus any other device such as PC, laptop or tablet. The vast majority of Brits (64%) and Americans (67%) would find it most unacceptable to receive unwanted advertising on their mobile phone/smartphone over other electronic devices.

There is a further warning that mobile display advertising is not the way to go. Less than one in six (11%) Brits and 15% of Americans who have surfed the internet on their mobile phone have ever clicked on a mobile banner advert and only one in every 100 Brits who surf on their mobiles and 1 in 50 Americans click on banner adverts frequently. The vast majority of those who surf the internet on their mobiles (79% in the UK and 72% in the US) find banner advertisements on their mobiles or smartphones irritating. . . 

IAB Reveals New Mobile Ad Formats, Bumps into MMA Ad Standards

A couple of weeks ago the MMA annouced 6 standardized mobile ad formats intended to reduce friction around mobile ad creation and media buying. The formats were directed toward smartphones and tablets alike. They didn't address the SMS/MMS market or rich media. 

These MMA ad unit standards were the by-product of widespread industry input and comment. Below are the "final," recommended formats: 

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I asked when these units were announced whether it was premature to try and standardize ad formats for mobile. Ironically, today, competing trade organization the IAB released its own preliminary mobile ad unit standards. Guess what: they're not identical to those generated by the MMA -- though I have not sought to carefully identify areas of conflict and overlap. 

Below is the IAB mobile ad units list, which will be subject to comment and then presumably "codified" among in the IAB Standard Advertising Unit Portfolio.  

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What we have now are like House and Senate versions of the same bill, which need to be reconciled in a conference committee. That is, unless the IAB is making a powerplay and ignoring the MMA's previously announced standards. 

The two competing sets of standards will be self-defeating as "standards" unless the two trade groups come together and hammer out their differences. Current MMA CEO Greg Stuart was the previous head of the IAB. 

Mobile Payments News: ISIS, InMobi-Opera and PayPal Carrier Payment Network

ISIS, the as-yet-unlaunched US mobile payments inititative from T-Mobile, AT&T and Verizon has added new partners to its stable of credit card issuers and banks (BarclayCard, Capital One, and Chase), according to CNET. ISIS has been described as "Hulu for mobile payments."

I have been openly skeptical of the carriers' ability to mount a successful mobile payments intiatitive. But ISIS may turn out to be the tortise to Google Wallet's hare. The latter has been met with carrier resistence (which may be anticompetitive), security problems and limited consumer availability.

Google has been ahead of the market somewhat. But there are now also rumors that Google is internally disappointed with its Wallet initaitive and may be putting less effort into it. If so, it would be premature to "give up" on Google Wallet. 

In two related mobile payents developments, PayPal (through its Zong acquisition) is launching what it calls PayPal Carrier Payment Network; and InMobi and Opera have joined for digital goods payments. The PayPal effort is designed to build on top of the Zong-carrier infrastructure (eBay acquired Zong last year) and expand carrier billing to encompass more types of transactions and larger dollar amounts:

Historically, carrier payment has been utilized primarily by online game developers and publishers to provide a fast and easy way for users to purchase goods directly in-app or in-game. While convenient for consumers, this method of payment has inherent challenges for other digital goods merchants – such as digital books, music, dating and content – to adopt as a primary payment method. Among the challenges is the cost of doing business – sometimes upwards of 40 percent – since transactions are processed through the carrier, merchants must share part of their revenue.

Similary InMobi and Opera announced that the latter will integrate InMobi's payments platform to enable virtual goods payments and purchases through Opera:

InMobi SmartPay will enable Opera users to pay seamlessly for digital goods in key markets around the globe, when they make purchases with some of the leading publishers that partner with InMobi. The two companies are committed to providing choice to consumers, mobile content developers and app developers, by building viable third-party monetization solutions in the mobile browsing and computing space.

Most US consumers have no experience with mobile payments and still need be educated about their benefits. However, large numbers of smartphone owners will eventually adopt mobile payments over time. Four tenents of success will be: simplicity, ubiquity, rewards and security.

The convenience of not having to sign credit card slips will be a welcome imrovement in the retail and restaurant worlds. The abandonment of signature requirements for transactions under $25 in many places has created demand and some experience with a simplified transaction experience. Merchants have incentives to adopt mobile payments as well for greater efficiency at the point of sale and, if don't correctly, greater security too. 

Almost all of these mobile payments systems and platforms back onto a credit card. However, it's still early to pick winners and losers. As I indicate above, Google could wind up a loser and ISIS a winner -- though that's a bit counter-intuitive (given the challenges carriers face in execution generally). There are still others (e.g., Apple) that could enter the race at any point.

Related posts:

Opera Transforms Itself into an Advertising Company

Opera has had great success with its Opera Mini and Opera Mobile browsers. Indeed, Opera has the greatest market share of any single browser provider in mobile. But as the world migrates from feature phones and RIM devices to smartphones Opera risks being displaced by Safari, Chrome and maybe Explorer.

In a diversification move, two years ago Opera bought ad network/mediator AdMarvel (for $8 million in cash plus $15 million more in potential earn-out fees). Today the company announced that it was doubling down on mobile advertising, buying ad networks Mobile Theory and 4th Screen Advertising. AdMarvel addressed publishers while the Mobile Theory and 4th Screen acquisitions cater to advertisers and the demand side.

According to the press release: 

[The two acquisitions] significantly expand its offering to advertisers and mobile publishers that engage consumers via the mobile web and applications, across all mobile platforms. Opera offers complete advertising solutions for mass-market feature phone and smartphone platforms, including iOS, Android, Blackberry, Java and Symbian.

Additionally, these acquisitions will enable Opera to better monetize the traffic that flows through Opera Mini and Opera Mobile browsers. With the world’s most popular mobile browser, Opera serves more than 160 million monthly active users that generate more than 100 billion page views, and consume more than 16 Petabytes of mobile data services a month, as of December 2011.

Mobile Theory is a leading premium mobile advertising network focused on the U.S. mobile advertising market, based in San Francisco, with offices in New York City, Chicago, Los Angeles and Seattle. 4th Screen Advertising is a leading premium mobile advertising network focused on serving the European mobile advertising markets, based in London.

Opera CEO Lars Boilesen said that AdMarvel has enabled Opera to "generate well over $200 million in revenue for our publishers globally" since the acquisition. Boilesen added that with the two new acquisitions, "Opera is uniquely positioned to deliver end-to-end mobile advertising solutions to brands, agencies, publishers and mobile operators across the globe." 

It also represents a fundamental shift in Opera's center of gravity. And from an ad-network perspective it's part of a larger, long-term trend toward industry consolidation. Yet it seems that just as one mobile ad network is acquired two more spring up.

MMA Brings Standardization to Mobile Formats, but Will It Harm Ad Creative?

After a 30-day comment period the Mobile Marketing Association (MMA) has announced a new "mobile ad package" that seeks to standardize mobile advertising around six ad unit types and formats. According to the MMA's press release there were "60-plus ad unit sizes" previously. The standardized mobile units are intended to simplify ad creation and buying across smartphones, feature phones and tablets.

The standardization decision came after input from companies such as AT&T, Google, InMobi, Microsoft, JumpTap, Millennial Media, CBS Interactive, the Interactive Advertising Bureau, The 4A’s, Newspaper Association of America and others. The MMA also says that rigorous data analysis went into deciding which six types of units to approve:

To create the Universal Mobile Ad Package v.2.0, the MMA, with support from ImServices Group, analyzed hundreds of billions of mobile ad impressions delivered across the global mobile advertising marketplace in 2Q 2011. The data – sorted by smart phone and feature phone, networks and publishers, and including mobile Web and app – helped determine the six unit sizes that serve as the standard Mobile Universal Ad Package v.2.0.

The MMA added that mobile video and rich media are not covered or included in the new standardized formats and previous guidelines around SMS and MMS marketing remain in effect. Below are the newly announced standardized ad-unit formats:

 Screen shot 2012-02-09 at 10.17.56 AM

While the trade group has certainly been thoughtful and inclusive in its approach -- and standardization will indeed speed mobile ad adoption -- the standardization of online ad creative was later blamed for later stifling ad creativity. That in turn prompted the Online Publishers Association in 2009 to develop a number of new, larger non-standard formats to reinvigorate PC display advertising and provide a "larger creative canvas for agencies, advertisers and publishers."

Jumptap Maps Kindle Fire Hotspots

Out with its December "MobileSTAT" mix of network data, Jumptap confirms what others before it (most notably Millennial Media) have said about Kindle Fire -- that it's the most successful Android tablet out of the gate:

In the first two weeks after the Fire’s mid-November launch, Amazon’s tablet outpaced all of the other iPad competitors in traffic including the Motorola Zoom and Samsung Galaxy Tab. Kindle Fire traffic grew 270% in November.

Here are the top Kindle cities in the US, as reflected in ad requests on Jumptap's network:

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Google’s Andy Rubin reported in Q4 last year that roughly 6 million Android tablets were in market. However there's not much evidence of actual usage. For example, see the following data from WiFi ad network JiWire (which also confirms Kindle Fire's surge):

The rumor is that Google will be producing a 7-inch tablet to compete with Kindle Fire and potentially undercutting it on price. 

Finally, a few other pieces of data from the MobileSTAT report. Android handsets now have more than 2X share of other operating systems on its network (Android 52.7%, iOS 22.1%). Compare Millennial's numbers (Android 50% vs. iOS 30%).

Among ad-targeting methods, location/geo is by far more widely used than other forms. While 79% of advertisers on Jumptap's network use at least one form of targeting, 64% use only one. Jumptap anticipates that will increase however over the coming year. 

Millennial Media Files S-1, Likely to Hit $90M in 2011 Revenue

No surprise here: Millennial Media has made good on its prior statements that it may seek an IPO. The company filed its S-1 in anticipation of that event this afternoon. Paralleling the growth of mobile advertising, Millennial reported $69 million in revenue in 2011 -- up from $29 million in 2010.

Correction: FY revenue for 2010 was $47.8M and $69 million is through September 2011.  (I wrote too quickly and didn't look carefully enough.) The company is not profitable but its losses have been steadily declining.

The total amount being sought in the public offering is $75 million. 

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Citing IDC estimates, Millennial characterizes itself as "the second largest mobile display advertising platform in the United States, with a 16.7% market share." The IDC numbers may be way off, but if they're accurate and $69 million is in fact 16.7% of the total value of mobile display ads in the US today . . . that total market value (not counting search) would be roughly $415 million.

Update: Given that $69 million is 9 months of revenue . . . the company's full year revenue is likely to be in excess of $90 million. Using the IDC figures (which again may be wrong) and extrapolating to the full value of the market, the total value of US mobile display would be closer to $550 million. That's somewhat more consistent with our sense of the market's growth. 

Millennial Seeing 'Hundreds of Millions' of Kindle Fire Ad Impressions

Millennial Media is out this morning with its latest "Mobile Mix" devices report. The report reflects the distribution of devices and corresponding operating systems on Millennial's network. Over time the percentage of smartphones on Millennial's network has grown dramatically and now stands at 70%. By contrast smartphone penetration in the US is about 44% according to the latest Nielsen figures. The other 30% of devices on the Millennial network are feature phones (14%) and so-called "connected devices" (16%): iPod Touches, Kindles, iPads and other tablets.

Connected devices are the main focus of Millennial's newsletter this time, in particular the Kindle Fire. Millennial confirms the popularity and apparently significant sales of the Kindle Fire, saying that the company is seeing a "monthly run rate of hundreds of millions of impressions":

Since its release in mid-November, the Kindle Fire has made an impact on the connected device market right out of the gate with early signs of strong consumer adoption.

On the Millennial Media platform, impressions from the Kindle Fire have grown at an average daily rate of 19% since its launch several weeks ago. We’re not just seeing millions of impressions, we’re seeing a monthly run rate of hundreds of millions of impressions.

The Kindle Fire’s impression growth on our platform has slightly outpaced that of the iPad when the iPad launched in early 2010. Though the Kindle Fire has been introduced into a more mature tablet market than the market which greeted the original iPad, the integration of Amazon’s robust digital entertainment library and the $199 price point may also have helped drive this early use by consumers. (emphasis added.)

The question raised in the excerpt above is whether "the $199 price point may [ ] have helped drive this early use by consumers." It's pretty clear the answer is "yes." The Amazon brand has certainly been critical, but it's mainly the $199 price that is responsible for the device's huge sales. The iPad created the new market for tablets and Kindle unlocked demand among those who we're more price sensitive and resisted buying "no-name" lower-priced Android tablets. 

Among the smartphones on Millennial's network, 50% are Android based handsets. However, save the Nook and Kindle Fire, Google/Android tablets have had almost no success for reasons of price and quality.

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Retrevo presented some interesting survey data yesterday showing consumer tablet demand is greatest for the iPad, followed by the Kindle Fire and then the B&N Nook. Retrevo shows that there is a market for Android tablets -- the Kindle Fire has already confirmed that -- provided the price is right and at least $100 less than the iPad. 

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Putting aside quality for a moment -- Android Honeycomb was a major disappointment from a UX perspective -- price is the major variable that consumers are responding to in Kindle Fire (but with the confidence of the Amazon brand behind it). The problem is that it's almost impossible for most tablet OEMs to get prices low enough to make any margin on them and be price-competitive.

If they match the iPad pricing they're perceived as imitators (e.g., Motorola Xoom, Samsung Galaxy Tab). But mobile carrier subsidies, which bring down the prices of smartphones, have not worked so far stimulate Android tablet demand -- mainly because consumers don't want another two-year carrier contract and the associated data fees. They're buying WiFi tablets instead. 

Android-based tablets that have been priced at or below $200 in the past have been made by companies that are unfamiliar to consumers and received poor quality ratings from experts and consumer reviewers alike. Even though Kindle Fire has had its share of problems and disappointed many reviewers, consumers know and like Amazon.

It was also shown that Amazon was taking a loss on the sale of every Kindle Fire, to establish a beachhead in the tablet market and because the company figured it could make up the loss and much more on content sales. 

There are rumors that Apple will introduce a 7" tablet next year to compete with the Kindle Fire, just as Amazon will go "up market" and deliver a 10" tablet.

Google, for its part, has suggested that it will respond to lagging Android tablet sales by bringing its own "higest quality" tablet to market next year. We'll see whether this is with an OEM partner or Google-branded (i.e., Chrome or Nexus tablet). Google is clearly another company -- one of the very few -- that could offer the combination of brand-instilled consumer confidence and subsidized pricing.  

Report: Facebook Mobile Ads Coming Before IPO

I've argued in the past that Facebook would be compelled to monetize mobile once it went public. I envisioned that monetization taking the form of more-or-less straight ahead display ads that were targeted in some way. I also recently performed a very loose calculation of what Facebook's global mobile ad inventory might be worth (at a $2.50 CPM) and determined it could be up to $2.5 billion.

What Bloomberg reported yesterday, however, was that Facebook was considering launching mobile ads that were more integrated into the Facebook feed:

Facebook Inc. plans its first push into mobile advertising by the end of March, giving the company a fresh source of revenue ahead of a possible initial public offering . . . An idea being considered is putting Facebook’s Sponsored Stories ads, which feature friends’ interactions with brands, within the mobile News Feed, said the people, who declined to be identified because the plans aren’t public.

Sponsored Stories in the mobile news feed would be like "promoted Tweets" on Twitter in some respects. Sponsored stories allow advertisers to show Likes from people in your network (brands, products, stores) in the ad copy. They reportedly dramatically improve CTRs. Below is an example from Facebook online: 

Earlier this week Nielsen reported that Facebook has the greatest "active reach" of any app across the Android OS (after the Android market). Facebook's most recent official mobile-user number is 350 million globally, out of more than 800 million total users.

My guess is that Facebook will be experimenting with various mobile advertising units/types before it launches anything officially. It already has a quasi-advertising vehicle in mobile "check-in offers." However Facebook itself currently doesn't make any money off these deals. Eventually that will probably change. 

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Network xAd Raises $9M, Will Challenge AT&T for Local-Mobile Ad Crown

Local-mobile ad network xAd has announced a new $9 million round of funding. The money comes from Emergence Capital Partners, SoftBank Capital and Palisades Ventures and Silicon Valley Bank. Roughly a year ago xAd raised about $4 million from Emergence Capital.

The company supports search, display and pay-per-call advertising. It also owns the Go2 mobile directory properties.

xAd says it's the "largest mobile-local advertising network in the U.S." Recently AT&T has laid claim to that crown saying it serves a billion mobile ad impressions monthly. AT&T offers mobile display ads, while xAd has text-based search ads as well. In May xAd announced that it had served more than 2 billion ads. 

In November, xAd reported 10 billion monthly ad impressions and 90 million monthly local-search requests. 

While ad networks such as Jumptap, Millennial, InMobi and AdMob all offer geotargeted ad inventory (to varying degrees of geo), xAd and AT&T specialize in locally relevant advertising. AT&T contends its ads deliver a much higher CPM than "remnant" ad networks. Previously xAd said that it can deliver a $30 CPM to publishers (not all inventory). 

In addition to xAd and AT&T, there are other local-mobile ad networks (mostly display):

  • LSN Mobile
  • Verve Wireless
  • Where.com
  • Marchex (PPCall) 
  • Chitika
  • CityGrid
  • Navteq
  • JiWire

xAd both aggregates third party (e.g., yellow pages) advertiser inventory and sells directly to national and local businesses. In September xAd said that it had 1.2 million advertisers in its network, which represented "about 30% to 40% of [total] local mobile search traffic and reach" in the US.

Millennial Media: Local Targeting Grows on Percentage Basis

The latest Millennial Media SMART report shows growth of location targeting among retailers and brands. Among other data presented in the October report, Millennial said that retailers and telecom advertisers (e.g., AT&T, Verizon) used store locators on landing pages to drive people into local outlets: 

Store Locator experienced growth of 5% month-over-month, with 23% of the Post-Click Campaign Action Mix in October (Chart C). Retail and Telecom advertisers increased their usage of Store Locator as a Post-Click Campaign Action to drive customers to stores for fall sales or to buy new mobile devices.

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The use of the store locator on a mobile landing page will be the primary way that brand and national advertisers "localize" for the foreseeable future. This is in contrast to the use of dynamic creative that inserts locations into the ad copy itself. Google mobile search results will be (and are already) an exception.

According to Millennial, "local market targeting" was the dominant component (66%) of the company's "Targeted Audience Mix" (40% of its overall campaigns). However, very interestingly, the use of targeting on Millennial's network has actually declined from six months ago.

In April 48% of campaigns were targeted (vs. 40% in October). Of those, 56% of impressions served by Millennial were directed toward local markets. 

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In absolute terms, then, the amount of locally targeted impressions being served by Millennial in April and October was almost identical. So while there's growth on a percentage basis, which is significant, overall local targeting in real terms remained flat. 

The fact that fewer campaigns on Millennial are targeted overall makes me wonder whether that money, especially locally oriented ad dollars, are fleeing to other networks.

Report: Local-Mobile Ads Dramatically Outperform Online

Local mobile ad network xAd has released its first quarterly report on local mobile user behavior and ads. I've done a general write-up at Search Engine Land. The company collected the data from its 10 billion monthly ad impressions and 90 million monthly local-search requests. The data in the report were captured between July and September.

A couple of highlights: 

  • 75% of smartphone owners conduct local searches (other data reflect up to 95%) 
  • 62% of local-mobile users conduct at least two local searches per month, while 32% of users do at least five local lookups per month

 The top local search categories according to xAd data:

  1. Restaurants
  2. Gas stations
  3. Shopping
  4. Auto repair/dealers/rentals
  5. Fast food
  6. Cafes/coffee shops
  7. Travel & lodging
  8. Health & medical
  9. Bars & clubs
  10. Finance & legal

Most interesting to me was the discussion of ad performance and "secondary actions." CTRs on ads in apps were 8% vs. 5% for ads appearing in the browser.

 

When you consider that average online display ad CTRs are 0.09% you see that this performance is dramatically better. Indeed, InsightExpress and Dynamic Logic have both documented how mobile display outperforms online across all metrics. 

In addition to browser vs. apps differences, xAd documents ad performance variations between iOS and Android. While CTR rates on the iPhone and Android are roughly comparable, "secondary actions" are greater on iOS: calls, map/directions lookups and review drill downs. Interestingly calls are happen more frequently in a browser context. But they're also the most popular "post-search" secondary action (62%) across the board, followed by maps and directions lookups (35%).

Previously xAd reported that its CPMs average $30. Other specialized US-based local-mobile ad networks include CityGrid, AT&Ti, Verve Wireless, Navteq, JiWire, LSN Mobile, Chitika, Marchex and Where.com. 

Millennial: Local Targeting Gains by 50%

Millennial Media has released its latest SMART report, which offers data about the campaigns running on its network. This edition has case studies and more data than most.

I zeroed in on a statistic that has also been reported in several other articles: location targeting increased by 50% quarter-over-quarter. Among campaigns on Millennial's network using any form of targeting, local targeting (which is at the city level) represented 66% percent of 45% of campaigns employing any form of targeting.

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I took a look back at a previous report covering July 2011 and discovered that 44% of campaigns were then targeted and 67% of those campaigns used what Millennial calls "Local Market Targeting." So the 50% growth figure doesn't entirely make sense to me. But I'm glad to see more advertisers recognizing the value of location targeting. 

Millennial highlights, among others, a Benjamin Moore paint campaign that sought to drive consumers into retail stores with a special offer. According to Millennial, "the campaign drove a consumer engagement rate that is more than double the network’s average for home furnishings and produced unique analytics for Benjamin Moore on consumer behavior around couponing."

Millennial also touted "triple-digit growth" across a range of verticals. Clearly we're in a hyper-growth period for mobile. In addition, Millennial announced earlier this week that they were expanding their operations to the Asian market. 

Why QR Codes, NFC and Augmented Reality Will Disappear into 'Visual Search'

QR codes are proliferating yet it's not clear that consumers are "getting it." ScanLife, it is Q3 trends report, says that 2D or QR barcode scanning is growing dramatically:

  • We have seen over 20 million scans in 2011, and that represents a 440% increase from 2010 through the same time period.
  • The number of countries scanning in a single day increased by 66% in a year. Users are now scanning from 128 different countries daily, a testament to the expanding global footprint of this technology.
  • The aggregated growth is also translating into a significant rise in the individual scans per code. As an example, the single largest marketing campaign this past quarter saw over 400,000 scans, compared to 65,000 a year ago. 

However US and UK consumer surveys indicate that most consumers don't know what a QR code is and only between 6% and 11% have ever scanned one (in the UK it appears to be 19%). According to comScore data, QR code scanners are mainly men and younger people (18-34) vs. other market segments.

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Somewhat strangely, QR codes seem to polarize marketers. There are some very vocal and aggressive QR code detractors that consider the technology a failure. And many see QR codes as some sort of interim step before NFC technology become mass market. 

In a parallel vein there's augmented reality ("AR"), which is a "cool technology" chasing a mass market use case. AR continues to be more of a novelty than something really useful to consumers -- or marketers. But it has potential in many non-commercial and commercial situations.

Then there's NFC, which has been written about extensively in connection with the launch of Google Wallet and mobile payments. Beyond payments, NFC is also a marketing tool and can deliver content and marketing messages to a handset with a simple touch of the device on an NFC-enabled surface or receiver. Given that very close proximity is required to invoke NFC it's not a substitute in all situations for AR or QR codes, which can both work from a distance.

A category that will likely subsume and incorporate all these technologies and tools is "visual search." Exemplified by Google Goggles or Amazon's new "Flow" app, it simply asks consumers to position the handset/camera over or in front of an object and then delivers information: reviews, prices, nearby stores, additional content and so on.

The notion of "visual search" is conceptually simpler and much more consumer friendly than "Augmented Reality," "QR codes" or "NFC." For that reason I believe that visual search will become the metaphor or category name for a range of approaches and technologies that are collectively about getting information or content (whether commercial or non-commercial) into the handset through the smartphone lens. 

NFC, AR and QR Codes all wear their complexity on their proverbial sleeves, while the term "visual search" buries the technological complexity behind a very descriptive and easy to understand concept. 

Google's HTGM Site May Help SMBs Go Mobile

This morning Google has launched a new site (HowToGoMo) intended to educate marketers large and small about the importance of mobile, and direct them to vendors that can build sites for them. I've written up the announcement and initiative generally at Search Engine Land.

The site offers mobile case studies, data on why you need a mobile site ("61% of users are unlikely to return to a site that’s not mobile-friendly") and the ability to see what your site currently looks like on a smartphone.

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The most interesting part of the site from my perspective is a vendor marketplace together with a set of filters that help you choose one. The questions or filter fall into three categories: 

  • Do you want to build it yourself? 
  • How much do you want spend annually (less than $1K or more than $75K)?
  • How quickly do you need one (one day, week or month)?  

There are 12 vendors that are likely to see a bunch of new leads from this site (Google isn't making any money from the leads). It will definitely help SMBs and enterprises accelerate mobile site adoption. As I wrote yesterday, In March of this year Google reported that the overwhelming majority (79%) of its top advertisers didn’t have a mobile-optimized site. But a new report from a firm called the Acquity Group found that 37% of the Internet Retailer 500 now do.

Just nine months ago, the overwhelming majority of small business (SMB) owners didn’t consider mobile an important marketing channel. In February 2011 we found that SMBs had very limited understanding and usage of mobile. Roughly 83% said they were not doing any form of mobile marketing.

However a more recent survey by Borrell Associates, among 484 small business owners, found that “four out of every five plan to spend money on mobile marketing this year; [and] on average these businesses expect to devote more than 20 percent of their ad budgets to mobile initiatives.” The survey also reported that 56% of these SMB respondents had been pitched mobile marketing solutions by “vendors or media outlets.”

In the larger context of yellow pages publishers and other SMB sales channels pitching mobile, as well as widespread adoption of smartphones by small merchants, this Google initiative -- especially its vendor marketplace -- will help speed SMB mobile site adoption. 

Jumptap: Everything Better with Rich Media

Jumptap is also out today with its monthly metrics newsletter on the heels of one from Millennial Media. The most noteworthy piece of data in this report involves the results of an examination of the relative performance of "standard mobile banners" vs. rich media ads: 

We ran an experiment to see how close we could get to isolating rich media as a performance factor, reviewing over 300 million campaign impressions, across several major advertisers that ran both rich and standard media with similar creative and messaging.

As you might expect the rich media ads outperformed the banners. But they did so by a significant margin: 

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Jumptap acknowledges that this wasn't a perfect comparison ("similar creative and messaging") but I believe the data are reflective of a performance gap between the two media types or units. 

Jumptap also reported that 56% of its advertisers used one form of targeting in September, while 8% used two forms and 2% used three or more types. By comparison, 34% used no targeting at all. Among the several forms of targeting location (by MSA) was the most common form (33%). 

In terms of landing pages and actions: click-to-web (76%) and click-to-download (23%) were the "preferred actions." I wonder how many of that 76% have mobile optimized sites or landing pages. I'd wager at least 50% do not. 

According to the Jumptap data, mobile ad clickers tend to be higher income ($50K+), male 2:1 over female and 35-75 years old, with the highest concentration in the 55 to 75 age range. In terms of platforms, Symbian sees the most clicks, followed by iOS, RIM and Android in that order. 

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Average mobile display CTR is 0.50; on the PC it's roughly between 0.1 and 0.3.

Like Millennial, Jumptap now sees twice as many Android devices on its network compared to iOS (47% vs. 23%). Millennial reported 56% of handsets were Android and 28% iOS.

Millennial: Android Share Now Double iOS on Network

Millennial Media's latest SMART report is out and the story is familiar: Android is the top platform, while the iPhone is the top individual device. RIM is still holding its own in the top 20 devices and Windows Phones still haven't shown meaningful growth. 

In July of 2010 smartphones constituted 49% of the devices on Millennial's network (immediately below). Now smartphones represent 72% of all devices on Millennial's network. While they'll never reach 100% (because of tablets and other "connected devices"), by Q1 of next year the number of smartphones on the network will probably be closer to 90%. 

July 2010: 

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Android devices represent 56% of all the handsets showing up for Millennial, while iOS has a 28% share. Accordingly, Android's share is now double iOS on Millennial's network. However Apple outperforms its relative share in terms of monetization, while Android under-performs: Apple devices generate 41% of monetized impressions on Millennial's network vs. 49% for for Android. 

September 2011:  

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Facebook Mobile Inventory Potentially Worth $2.5B

If Facebook wanted to turn on mobile advertising it would instantly become the largest "mobile ad network" on the planet. Indeed, I believe after the IPO Facebook will be all but compelled to run ads on its mobile apps and HTML site. But how much money might Facebook stand to gain from such a move?

A great deal is the short answer. Let's do some simple math to find out. 

Facebook now has more than 1 trillion monthly page views on a global basis. In the US the number of monthly page views is 300 billion. According to an analysis by Hubspot in May, 2011 roughly 33% of Facebook's traffic was coming from mobile devices. 

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If that formula is correct, then approximately 99 billion of Facebook's monthly US page views come from mobile devices. This is mind boggling. 

If we use a $2.50 mobile CPM ($2.50 per 1K impressions) to value this inventory it would mean that Facebook would be in a position to instantly add $247.5 million in US ad revenue to its coffers -- assuming 100% fill.

On a global basis, using the same crude formula, Facebook's inventory would be worth approximatley $2.5 billion, the annual mobile ads run rate that Google announced last week

Mobile + POS Data Will Transform "Online Marketing"

There are now a range of companies working on connecting online activity and ads with action at the POS using mobile devices. NFC-enabled mobile payments is just one of many initiatives going on. For example, Shopkick just announced a deal with Giant Eagle supermarkets that connects the mobile app with Giant Eagle loyalty accounts:

Shopkick's first partnership with a supermarket, and more importantly, co-founder and chief marketing officer Jeff Sellinger said that it allows the startup to "close the loop." Now, by tying user accounts to Giant Eagle loyalty cards, Shopkick will have data on what users actually purchase. That means brands can offer rewards not just for scanning products, but for buying them too.

Google Wallet just expanded its features, as well as the roster of participating stores and merchants. Now with a "single tap" Google Wallet users can pay, redeem coupons and get loyalty points. Currently Google doesn't see the transaction value or other details in the way that Shopkick and Giant Eagle will through their arrangement. But eventually Google will probably get access to more data and make that available to marketers.

Deal vendor Bloomspot has a system that uses registered credit cards to close the loop with daily deal buyers and determine whether they spent more than the face value of the deal in restaurants and stores. Placecast is working on something that matches offers and in-store transactions through credit card accounts. LSN Mobile has a relationship with First Data.

There are several other such examples I could use to illustrate what is a growing and very important trend. 

Mobile devices will allow marketers to see who showed up in stores and, in the very near future, what they bought and how much they spent. There are some significant privacy issues and implications of all this and I don't want to dismiss or minimize them. However the effort to track the influence of ads and offers from online (or traditional media) to the point of sale is a trend that is starting to gain momentum.

We're not that far away from a time when agencies and marketers will have considerably more visibility into what online ads drove what in-store purchases, as well as user profiles based on purchase behavior and response to ads. This data has been collected for years in the offline world but now, through mobile devices, online marketers are going to get some new visibility on the dominant online-offline shopping paradigm. 

Remember that e-commerce is only about 5% to total US retail but the Internet influences billions of dollars in offline transactions. Accordingly the growing visibility that marketers will have in just a few years about who responded to ads and what they spent will have a profound impact on the future sophistication and tactics of "online marketing." 

Report: Android Dominates but iOS the CTR King

Ad networks Jumptap and Millennial Media are out with their respective data newsletters today. The Millennial missive this time focuses on CPG companies and their campaigns. According to Millennial, most of its CPG advertisers' focus was on branding and awareness, rather than driving people into stores to buy products or app downloads.

Yet one of the primary "post click actions" of CPG campaigns involved sending users to a Facebook page or other social media account. "Mobile Social Media represented 78% of the Post-Click Campaign Action Mix for CPG Advertisers in August," according to Millennial. "CPG advertisers utilized mobile campaigns to drive customers to social media outlets where they could engage with the brands and provide feedback on products."

Consistent with their branding objectives, CPG brands also over-indexed on mobile video as well. 

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Jumptap presented data on a fairly broad range of topics, from CTR rates by OS to demographics and device marketshare. Jumptap now says that Android devices now deliver almost 50% of the impressions its network and that the Google OS is close to having more than twice the share of the other operating systems combined.

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For comparison purposes, here's what comScore said yesterday about smartphone OS share in the US: close but not identical to the Jumptap figures. 

Jumptap points out that despite Apple's smaller market share its iOS generates higher CTRs, while Android under-indexes vs. the average on Jumptap's network.
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Most Jumptap campaigns (see below) appear to be sending people to the mobile Web ("click to Web"). What's not clear from the data is whether these campaigns are sending people to mobile-optimized sites/landing pages or whether they're simply going to conventional PC websites. More likely than not it's the latter, given Google's previous comment than nearly 80% of its top advertisers didn't have a mobile-optimized presence. 

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Jumptap said that "mobile users age 45-74 have the highest CTR" and that men have 2X CTR of women. Those earning over $50K click on ads 5X more than those under $50K, which Jumptap attributes to higher rates of smartphone ownership among more affluent consumers.  

Among targeting methods -- and this is echoed by Millennial's data -- the top tactic was location targeting followed by device/handset targeting and demographic targeting. 

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Finally, Jumptap compared the top-spending verticals by CTR. The X-axis in the chart below shows spending and the Y-axis shows relative CTR. Entertainment is the vertical that sits in the sweet spot of both, followed by automotive, insurance and technology/electronics. 

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