The survey is from Motorola and TNS International. It was conducted during this past November and December. It had 4,500 respondents. Respondents were from the US, Canada, UK, Germany, France, Italy, Spain, Mexico, Brazil, India and China.
Here are the findings:
These are not simply smartphones either. Consumers are doing a range of activities on the phones: looking for price comparison information or reviews, taking photos of products, looking for coupons or deals and so on.
We've argued for a long time that shopping was one of the "near-term use cases for mobile phones." It's only going to be more so in the future.
Related: Clients see our recent mobile coupons report.
Nielsen says that smartphones are now 15% of the US handset market, while Forrester says it's 17%. Our data from 2009 show 15% as well. Previously Nielsen argued that smartphones would cross the 50% threshold by 2011. That's still optimistic I believe but they're grabbing a larger and larger share of handsets.
We know from our research and that of others that people are very enaged with their smartphone devices. Now Compete Inc has released some data from its Q3 2009 smartphone survey about shopping and "m-commerce" on these devices. Here are the top-level bullets:
The slide able suggests that people aren't willing to spend more than token amounts of money via smartphone purchases. This will change as people come to see the Internet on their smart devices as comparable to e-commerce online. However, most purchases do not occur online; they take place in stores. However the Internet influences those purchases.
The smartphone is a bridge between the PC Internet and the larger physical world.
Much of the behavior in the slide immediately above is the same or substantially the same as what exists online today. The difference with smartphones is that people have them when they're standing directly in front of an item in a store. Accordingly people are looking for reviews, competitive price information, and coupons about products they want to buy. They're also trying to find stores and stores where they can pick up those products.
Finally here's the strategic takeaway:
8% of smartphone owners that tried to purchase a product on their device were unable to do so. 45% of those that abandoned the process reported that they did so because the site would not load, and an additional 38% left the site because it was not developed specifically for smartphone users.
So despite the webkit browsers that can render full websites, you still need a smartphone-optimized mobile website (or an app or both) for optimal user engagement, especially if you're trying to sell things.
In a banner day for the mobile Internet that included noteworthy announcements from both Apple and Google, a newly released Quantcast report details the explosive growth of the mobile Web in the last year.
While growing mobile Web usage is to be expected, the numbers are significant and today's announcements underscore the dramatic battle for market share that's sure be had in the coming year.
Among the highlights in the report:
A snapshot below shows the steep rise in mobile Web consumption over the past three years.
We reported on this earlier but Nielsen has released its year-end mobile lists: handsets, brands and top sites accessed via mobile devices. It's not entirely clear what the distinction between a "site" and a "brand" is in this set of rankings but below are the charts.
Compare the top Nielsen sites (for 2009) with Opera's top sites for November. There's overlap but the lists are also different, Presumably the Nielsen data capture iPhone, Android and a somewhat broader spectrum of device usage than the Opera data:
And finally, the top handsets for the year:
This month Opera is focusing on Africa. I'm not going to elaborate on the findings there except to point out that Opera says:
Facebook has taken the lead in Africa; it is the most popular site visited by Opera Mini users in 6 out of 10 countries and the #2 site in three of the countries where it is not #1. Google is also very popular, and is ahead of Facebook in a few of the top 10 African countries. Yahoo and Wikipedia are also ubiquitous in the top 10 lists of the various African countries.
Here are the top lists for the US, UK and China:
As with all other such data (e.g., from AdMob, Millennial Media) it's important to note that these data are from handsets where Opera Mini is installed and not necessarily representative of the mobile Internet as a whole. However these data are going to be broadly consistent with trends among other users.
Deloitte conducted its "State of the Media Democracy survey" this past September. Just over 2,000 responses were collected from the online survey. Respondents were between 14 and 75 and reside in the US.
It was a very broad survey about media usage and attitudes. Here are the mobile-related findings:
According to the survey these were the most popular mobile activities:
The latest mobile metrics report from AdMob shows the growth of Android devices and the increase in WiFi mobile Internet access. It also shows where in the world the now almost 80 million iPhone OS devices reside. Here are the top-level data and some of the familiar charts:
Finally, in the US market -- at least on the AdMob network -- it's really shaping up to be a contest between the iPhone, Android and RIM; the other operating systems are really shrinking or being squeezed out.
All of these data are qualified by the fact that this is a reflection of AdMob's network and not the "mobile Internet" as a whole; however the trends are going to be consistent with the broader mobile Internet.
The US Center for Disease control has been tracking the number of households (and related demographics) that have landlines, mobile phones or a combination of mobile and landlines. As of the first half of this year:
More than one of every five American homes (22.7%) had only wireless telephones (also known as cellular telephones, cell phones, or mobile phones) during the first half of 2009--an increase of 2.5 percentage points since the second half of 2008. In addition, one of every seven American homes (14.7%) had a landline yet received all or almost all calls on wireless telephones.
If almost 23% are mobile only and 14% mostly use their mobile phones -- the landline is like a "spam catcher," as Dan Miller likes to say -- then 37% of US households should be considered mobile-centric, where the mobile device is the only or primary means of phone communication. According to the CDC here is the demographic breakdown:
It shows how people under 45 are becoming more and more mobile centric. This has implications for all kinds of things, including of course advertising.
According to the US Census Bureau, there are roughly 113 million US households against 304 million people, or 2.6 people on average per household. Twenty-two percent of these numbers equals about 64 million people with mobile only service and 109 million in this larger group I'm calling mobile-centric.
I'm not going to keep doing this for the next week or so, but here are JumpTap's and the MMA's predictions for next year:
10. Hypochondriac? We've got an app for that!
Ongoing global pandemics and concerns about socialized healthcare warrant a prescription for mobile content geared toward the sick and the paranoid. Symptoms to watch for include apps that diagnose, doctors that text and medical reminders at hand. Mobile health is just what the doctor ordered!
9. Back to Reality...
Oh, those boring old coupons - they get lost, forgotten, left behind or expired. Look for augmented reality to start playing a larger role in location-based advertising. Now, when you're walking into your favorite coffee shop, the real-time mobile coupon you receive gives you instant gratification with your discounted daily grind.
8. I want my Mobile TV.
In the coming year, both the 2010 Winter Olympics and the 2010 World Cup will heighten mobile video consumption. The introduction of new ad units, including interactive and partial screen, will subsidize free content.
7. Practice Safe Text
Governments and safety advocates around the world warned against texting and driving in 2009. We expect 2010 to bring about technology solutions that disable handset features when the owner is driving.
6. A guy walks into a Barcode...
Proliferation of standardized technology and higher quality camera phones will not only lead to increased adoption of mobile barcodes and coupons, but will also offer a whole new access point to content.
5. Have you hugged your aggregator lately?
Look for aggregators to expand their businesses beyond shortcodes. Aggregation services in the areas of location, customer service and mobile commerce will begin to emerge.
4. Turn free in 1.2 miles
Free is a very good price. We're keeping an eye out for no-cost turn-by-turn navigation applications rolling out on more devices in 2010. The end of stand-alone GPS is in sight. What great news for consumers...and McDonalds, Dunkin Donuts and Dairy Queen.
3. Your Skype is Showing
Services that enable video conferencing and the networks and handsets that support it (like cameras on the front of the phone!) will proliferate in the coming year. More consumers will connect via WiFi, offloading traditional non-wireless video conferencing services.
2. How does mobile measure up?
Moving into 2010 and beyond, campaign effectiveness will be measured in a variety of different and very creative ways. The number of eyeballs, shakes and finger swipes. The number of blogs, articles, tweets and diggs. The number of acquisitions, conversions, calls, responses or purchases. Total basket size, consumer recall, loyalty and recommendations. Check-ins on foursquare and check-outs on Amazon.
1. Mobile's Sixth Sense
Over the past few years, the mobile device has moved beyond standard technology inputs. We're no longer talking, typing and clicking. Now, we're photographing, recording, touching, locating, shaking, accelerating and blowing. What's next? We're rooting for smell recognition.
Morgan Stanley's Mary Meeker gave a mobile-centric Web 2.0 conference presentation that everyone was talking about several months ago. From our point of view there wasn't anything particularly new in her remarks but she put everything together into historical context. And the crowd there, which may not have seen mobile as "distruptive," was paying attention.
Now comes hundreds of pages and slides that everyone can download here:
There's a ton of data and projections in these documents. Read them over the holiday or before bedtime. Perhaps the most interesting part (I haven't been through everything) is the historical analysis that talks about previous disruption cycles and predicts winners and losers in the future accordingly.
The big themes are that the mobile Internet will be "at least" 2X the size of the PC Internet and that the whole thing is "ramping" much faster than the desktop did. The latter point we've made many times in the past.
We are clearly in a kind of double-transition period: traditional media are contending with the fruits of massive consumer Internet adoption but the transition to mobile is happening simultaneously and perhaps a bit obscured as a result. But just as the Internet is "disruptive" of traditional media, mobile is also potentially disruptive of aspects of the Internet. Google has seen that perhaps better than any of its competitors and moved very aggressively as a result.
Many companies, analyst firms and media outlets tend to focus on ad revenues as a measure of whether a medium has "arrived." For example, many of the articles and even forecasts about mobile ad revenues tend to talk about how small they are relative to traditional Internet advertising. And when, oh when, will it be "the year of mobile"?
Dude this year already was. We're here.
Whether ad networks and publishers can efficiently and effectively monetize the mobile Internet is not going to matter to consumers -- not going to matter. Consumers will be using the mobile Internet more and more and as a primary access point in an increasing number of situations. It will be preferred in a large number of cases.
The smartphone is going to become "the remote control for your life," in the way that the iPhone or iPod Touch can literally become a remote control device for TV. People will want to access content that they've researched, saved, collected online (i.e., in the cloud) from the mobile device. But the future is not just about phones; it's about myriad mobile devices and Internet access points in the world against near-ubiquitous connectivity.
The mobile Internet -- from a consumer perspective -- will get larger and larger. Ad revenues will come but consumers are way ahead. Millennial Media predicted that we'd see 100 million mobile Internet users in the US next year. I think that's nearly a slam dunk prediction. Frequency is another matter of course but it too will go up over time. Voice search on my handset may mean that I do as many or more searches there than on my PC.
I'm sitting on the couch and I want to know the answer to trivia question X. Do I get up and go into the other room? No, I take out the smartphone and speak the query: "Who was the 17th president of the US?" Done. Now back to the movie.
Advertisers, agencies and publishers ignore the mobile Internet at their own peril.
If you thought that the PC Internet gave people control over which ads they consumed, you ain't seen nothing yet. Less inventory and consumer ambivalence about ads on their handsets means that advertising will really need to turn into "content" or be so viral or targeted that people will be motivated to respond. This despite the fact that mobile response rates are much higher than on the PC.
That's a bit of a paradox, I realize.
Source: Morgan Stanely research
Predictions: they're unavoidable PR products this time of year, a ritual that is almost compulsory now. Mobile Marketer has rounded up a number of predictions in a new article. Some of those are from Millennial Media, which released its set independently.
Here's the Millennial Media list:
Here's what we agree with among the above:
Privacy may become a significant issue for mobile in 2010 as it has online this year. One of the predictions in the Mobile Marketer piece is that the carriers open up location this coming year to third parties. That's likely to be the case; increasingly cast in the "dumb pipe" role they need to find ways to make themselves relevant to advertisers, ad networks and consumers.
Stepping back, two broad things are important to point out:
Along the lines of the latter point, as has been repeated many times before, mobile is not a stand-alone marketing strategy. It must be considered in the larger context of an overall campaign. And all publishers (and increasingly brands) must have a mobile strategy in 2010 -- but be thoughtful about it.
I would also argue that online and mobile media buying will become much more integrated in the coming year to reduce barriers to mobile advertising and provide combined reach to marketers. Mobclix's deal with Advertising.com is a leading indicator of what's to come.
The mobile handset is a "bridge" between the digital and physical worlds and location matters -- a lot. But "local" is not the alpha and omega of the mobile experience. People do all sorts of things on their handsets that have nothing to do with where they are right now. However to realize the "location x relevancy x immediacy" opportunity argued above, dynamic ad creative will need to become more widely used (see Google-Teracent).
Social media and communication between people is also a central part of the mobile experience that wasn't really discussed in the predictions above. Local + mobile + social will be widespread in 2010. Voice search and voice control of handset functions will become more central to the user experience.
Finally augmented reality; here's what the Mobile Marketer piece says:
Augmented reality will likely gain traction in 2010, but will remain a bell and whistle compared to list and map view.
1020 Placecast believes that 2010 will be the year that this exciting technology begins to be adopted on mobile phones . . .
Expect to see retailers and entertainment companies trying out ways of showcasing their brands with this niche, but exciting new technology. Although augmented reality will appear in more applications, consumers will still prefer the list and map versions to search results on a usage basis.
I would say something slightly different. It's not going to be the list or map vs. the floating Twitter posts. Augmented Reality's use cases have already started to emerge and the "more information about what's in front of me" scenario is what will stick for AR in the near term.
AR "browsers" won't replace conventional search or be widely adopted, but the ability to gain more information through the camera or by taking a picture of an object (e.g., Amazon-SnapTell, Google Goggles) will become more commonplace as part of a larger application or experience. I won't scan the street with my camera to get reviews about the restaurants in Times Square. But I will get more information about a painting, a building or a product using the camera. I might stand in front of a restaurant to see if there's a deal or discount via AR. (Related to this is QR codes, which may become more widespread in the US in 2010.)
Augmented reality in the form of "visual search" is right now the most provocative area for mobile development in my opinion. Voice is perhaps more mundane but very important for the advancement of the mobile user experience.
Update: Neglected to mention tablets will continue to proliferate but may not have an impact until 2011.
According to Nielsen, last year the top US mobile handsets list looked like this (the % numbers are "embedded subscriber base"):
In 2009 (through Q3) the list has changed, with the iPhone now moving into first position:
Significantly, Nokia, which had two handsets on the list, is gone entirely and there isn't a Windows Phone present either. Of course, neither is there an Android handset but I would imagine that we'll see one or two Android handsets at least next year. Palm isn't there and isn't likely to be next year either.
Nokia is probably done in the US, as I've argued. The real question is whether Microsoft will have phones on this list next year. If not it will be panic time in Redmond.
Take every forecast not as gospel but as indicating the direction the market is heading. Look at multiple forecasts for consensus. Forecasting is something of a game. Healthy skepticism is required, even for the stuff we do.
Here are some wide ranging device and Internet access projections from IDC:
Nothing much to be said other than: "growth, yes."
The big deal, which was highlighted by Google's Vic Gundotra the other day, is that "we're at the beginning of the beginning" of a new era of computing. It's really pretty clear that mobile devices, ubiquitous connectivity (which is coming) and data in the cloud are going to make computing and mobile Internet-based computing look very different in a few years than they do today.
We'll be saying over drinks, "Remember when you had to sit at a terminal with an Ethernet cable plugged in to get online . . . "
Here's how the list compared to the top overall search queries of 2009 on Yahoo!:
Interestingly the only common query is American actress "Megan Fox." Otherwise, mobile gaming, movies and email were among the most prevalent queries Yahoo! saw from mobile devices. What's strange is that people were also search for the iPhone on their handsets -- unless they were looking to replace their existing phones with one.
Related: Here's Google's list, which doesn't break out mobile separately.
The following charts are from the Opera "State of the Mobile Web" report for October. They represent the top sites and other data from Opera users in the countries represented below. More countries' data are available via the Opera site.
Although there is some slight movement among sites, the "top 10" are fairly consistent over time. For example, Facebook and Google vie for the top spot in the UK and US month after month. The recent strong showing of Yahoo! (no. 3 and 4 in the US and UK) can likely be attributed to the company's improved mobile homepage/portal.
You can check any month this year by going here and then changing the final number to the desired month.
Take it all the numbers with some caution (see below). MediaPost reports on IDC's estimates of the revenues of various mobile ad networks (some figures are global and some US only apparently).
IDC says that Google-AdMob's (GoogMob's) mobile ad revenues would be worth $68 million, or 24% of the overall market.
Here's the full list and their IDC-estimated revenues:
Update: I'm getting some feedback from a couple of reliable sources that these numbers may be close in a couple of cases but are otherwise inaccurate.
Here are some other numbers from an article that appeared in AdAge (by Rita Chang) on October 12, 2009. Estimates are based on inferences and interviews with a number of parties:
There might be something wrong with me because I do get relatively excited by these mobile ad network data reports. Out today is Millennial Media's October SMART report. It also features some interesting apps-related data from mobile ad exchange Mobclix. Here are the data and a few related charts:
These are display ads that people are responding to. The average CTR re online display ads -- even though the click is not a good metric to measure the impact of display -- is far less than 1%. The chart below reflects averages across display and rich media on the PC:
Source: DoubleClick (2008)
Average In-App CTR in Four App Categories by Manufacturer:
The higher clicks in the utility and navigation categories suggest a different consumer intent (someone trying to accomplish a task) and I'm speculating that they're responding to relevant ads accordingly.
The following actions represent post-CTR activity on the Millennial network:
Here is the mix of feature phones and smartphones showing up on the Millenarian network:
Compare to the compoisition of smartphone handsets on the AdMob network:
Source: AdMob (Sept, 2009)
Nielsen offers some interesting data on UK smartphone owners and what they're doing online with their devices. First the penetration numbers:
So the smartphone penetration rate in the UK is less than in the US and just over 4% if the numbers above are accurate.
Here's what Nielsen says smartphone/mobile users in the UK are doing -- a leading indicator of broader behavior later for the mainstream users as they upgrade:
Here's what Opera says are the most visited sites among its user base in the UK (September data):
Consulting firm Deloitte conducts an annual consumer survey in Q4 (n=10,878 US adults). Among other findings, this year, the firm discovered the following about the integration of mobile into holiday season shopping behavior:
Retailers with apps, mobile-friendly sites and promotions (coupons, SMS) may reap the benefits of this consumer behavior vs. those that neglect mobile.
It's a mystery in a way that the free DA market simply hasn't materialized as we at one time expected. Logically it should have because these services represent a mass-market form of local mobile search and a seemingly perfect ad platform. But just as PPCall never really developed online (though now there's movement again) the free DA market is weak at best and already stroon with failures.
I was struck by a column from TMPDM's Gregg Stewart in which he exposed some directory assistance calling data (derived from the company's annual study with comScore on the local market). The data were collected in July (US Internet users, n=4,000). Stewart said the survey showed "23 percent of mobile users access directory assistance as part of their local search process."
In our ealier research the data reflect that 20% of mobile users called DA, so largely consistent (with a smaller sample). In April, we found that the majority of mobile DA users (61%) call DA/411 "a few times a year."
In an 2007 survey Opus conducted, the percentage was basically the same: 61% called DA from a mobile phone "once every three months." Thus, for most, DA calling is relatively infrequent and that's not likely to change. If anything usage and DA calling frequency should decline as voice search and mobile Internet access grow.
Here's what TMPDM and comScore found in July, 2009 about the distribution of calls from that 23% of the survey respondents who called DA from a mobile phone:
Source: TMPDM-comScore (July, 2009)
Below is the distribution from our most recent survey; note that traditional 411 is not a choice, so it's likley represented in "another 411 service" or "none of these."
Source: Opus Research/Internet2Go (April, 2009)
In both charts I don't believe that people are calling "800-Yellowpages" as much as they report. I think they're responding to what seems like a familiar brand. And many of the services (e.g., 411-Metro) in the comScore chart are now defunct.
The free, ad-supported DA market at one time seemed very logical and held great promise. I had called it "local-mobile search for the rest of us." But the "rest of us" are buying smartphones, which largely emerge as a replacement for such services. Plus the per-use charge of conventional DA is an inhibitor for many, though not all, people.
Anecdotally marketers I've spoken to have reported good ROI from use of 800-Free-411 but the volumes for any given category and city are low so it can only be seen as a supplement to other digital or mobile marketing efforts.
In general the carriers seem to be neglecting their services:
And the search engines (Google, Bing) are maintaining their services but not promoting or continuing to develop them. There is a significant role for "voice search" to play in the mobile world but it doesn't appear the primary locus of activity will be free DA services.