Mobile Advertising

Millennial: Windows Phones a Rowboat on the Android Sea

The iPhone vs. Android meme is getting very tired yet it persists. That's the thrust of the coverage surrounding Millennial Media's "Mobile Mix" report for July 2011. Among other data, it ranks handsets and market share on the Millennial network by device type and operating system. Here are the "quick facts":

  • iOS and RIM impressions were relatively flat month-over-month
  • Android impressions grew 31% month-over-month
  • Symbian impressions grew 11% month-over-month
  • Windows Phone 7 impressions grew 71% month-over-month

The Windows Phone growth is noteworthy for the fact that that there is growth/life. By contrast comScore shows Windows/Microsoft losing share month over month. However high percentage growth from a very small base is, in actual handset numbers, not particularly meaningful. Several months of such growth would be significant however. We'll need to wait for the first Nokisoft phones to appear to see whether Windows will "make it" as an OS.

Unfortunately Millennial doesn't put much historical context into its individual reports. So I always like to take a look at the data from several months or a year ago to compare the figures. Accordingly here are several charts from this month's report and July 2010:

Top handsets on the network (7/10 then 7/11):

Screen shot 2011-08-24 at 8.12.40 AM
Screen shot 2011-08-24 at 8.12.55 AM

The iPhone has maintained its top position and RIM is holding on with three handsets in the top 20 vs. four a year ago. But otherwise it's all Android.

Operating system share (7/10 then 7/11):

 Screen shot 2011-08-24 at 8.10.24 AMScreen shot 2011-08-24 at 8.09.51 AM

As you can see smartphones have grown from 49% to 68% on the network. In the US market smartphones are about 40% of all handsets now according to Nielsen. As you can also see, the relationship between iOS and Android has flipped in a year with Android handsets now representing 61% of all impressions. 

In terms of monetization and revenue, however, Android continues to underperform its share while Apple devices outperform their relative share. 

Screen shot 2011-08-24 at 8.11.14 AM

Finally, as PaidContent has pointed out, one of the more interesting pieces of data surrounds "carrier" usage. Over the past year WiFi access has grown from 26% to 33%. This is probably a direct result of the use of "connected devices" (e.g., the iPad) more than any other variable. 

Screen shot 2011-08-24 at 8.39.42 AM

Screen shot 2011-08-24 at 8.40.09 AM

However as carriers eliminate unlimited data and throttle speeds on their networks, on the go users will increasingly seek alternatives that offer cheaper and/or faster access to their applications and the mobile Internet.

Placecast ShopAlerts Now App-Ready

Placecast announced today the availability of ShopAlerts push notifications for retailer mobile apps. Previously Placecast ShopAlerts enabled geographically relevant SMS or MMS messages after a consumer opt-in. This new announcement means that geofenced alerts can be integrated into existing retailer apps to boost the effectiveness of those apps.

In the conventional scenario, users need to launch a retailer app and affirmatively search or browse for content. The new program enables consumers to receive LBS alerts that use promotional messages to direct consumers to the nearest local store or outlet, once inside the geofenced area. It's not clear whether the app-based ShopAlerts would require explicit consent to LBS notifications. (On the iPhone notifications require acceptance in general.) Best practices suggest at least a disclosure if not an opt-in. 

Push notifications aren't new but this combination of app + alerts could prove effective for retailers and help boost app usage. Examples of companies already working with Placecast ShopAlerts include North Face, Subway, Kohl’s, Kmart, Starbucks and JetBlue, among several others.

The efficacy of geofenced ShopAlerts has been demonstrated in the UK with O2 and in various tests and trials in the US.

Related Placecast posts: 

QR Codes Replacing SMS Marketing in Some Contexts

As I wrote in a post at Search Engine Land, we don't know yet whether QR codes are here to stay or whether they’re an interesting experiment on the way to something else, such as NFC-based marketing. But in the near term at least they appear to be gaining and increasingly used by publishers and marketers.

Comscore has come out with some interesting new data on usage patterns. Demographically the heaviest users of QR code scanning are 18-34 year old males who make more than 100,000 per year. Most scanning is done in the home (newspapers, magazines) or in retail or grocery stores. 

Several years ago I wrote a white paper about the virtues of SMS based marketing that argued SMS was a highly versatile tool that could be utilized in many ways: on traditional ads, in digital ads, on product packaging and so on. I also argued at the time that consumer response to SMS calls to action also provided compelling analytics for traditional media. 

That's exactly the way that QR codes are now positioned. Accordingly they'll probably replace SMS in some contexts as a mobile marketing tool -- if QR codes survive. But QR codes don't really do CRM loyalty marketing as well as SMS.

Millennial's 50th SMART Report Charts Growing Sophistication of Mobile Campaigns

Millennial Media is out with its monthly SMART report. Yesterday the company hosted an in-depth webinar to review the data in advance of the report's release and in honor of this being the 50th such report. Familiar data points about campaign tactics and devices were discussed. For example, in June, Android retains its platform leadership (53% of impressions), while the iPhone remains the top individual device (27% of impressions).

Here are some of the things I "tweeted" yesterday during the webinar: 

  • More than 70% of Millennial ad impressions are coming from in-app activity
  • 40% of mobile consumers' usage time spent inside the home (based on InsightExpress data)
  • Local market targeting continues to gain traction to drive consumers to brick and mortar locations
  • Feature phones are no longer in top 20 handsets on the Millennial network

But the most interesting thing about the report to me is the comparison of June 2011 findings with those in the first report more than two years ago. Here are several graphics that reflect the market's growth and evolution:

Screen shot 2011-08-12 at 7.34.30 AM

Screen shot 2011-08-12 at 7.35.54 AM

Screen shot 2011-08-12 at 8.04.03 AM

Screen shot 2011-08-12 at 7.35.03 AM

Screen shot 2011-08-12 at 7.33.30 AM

The broad themes reflected in the graphics above are: the rise of touchscreen smartphones (Android and the iPhone in particular) and the growing sophistication of mobile advertisers and their campaigns. I don't have the vertical categories chart among those above. However Millennial has seen explosive, quadruple-digit growth in verticals like Finance, Retail/Restaurants, Automotive, Entertainment, Travel and Pharma. 

In response to a question during the webinar about the sophistication of advertisers Millennial SVP  Mack McKelvey responded, "The vast majority of our advertisers are very savvy and challenge us all the time."

Mobile Users Prefer Coupons and Opt-In SMS to Other Types of Ads

A press release based on research from Upstream (conducted by Luth Research) carries the following headline: "Personalized Messages Four Times More Effective than Time-, Lifestyle- or Location-Based Offers . . ." This came to me in an email last night.

The headline and the presentation of the data in the release are somewhat misleading, however. And with so many companies releasing data for PR reasons (and the market awash in numbers) no one should rely on a single piece of data or single study. There are some interesting findings however. 

The Upstream study involved a consumer survey of just over 2,000 US adults (both smartphone and feature phone users); there's no behavioral data here. Below is the hierarchy of ad preferences based on the categories in the survey:

Users ranked personalized offers at 59 percent over those focused on timing (18 percent), lifestyle (16 percent) or location (8 percent). Smartphone users responded in similar fashion, with 60 percent preferring personalized offers over promotions based on timing (17 percent), lifestyle (10 percent) or location (14 percent).

Screen shot 2011-08-10 at 9.23.10 AM

This stands for the idea that personalization trumps dayparting, lifestyle and location. Lifestyle is a vague concept that seems less relevant than "my tastes and interests." Indeed, this phrase implies greater relevance than these other aided-response categories. The verbatim question is: "In your mind what constitutes the best basis for an offer to be relevant to you?"

Location by itself doesn't mean an offer or ad is relevant, neither does timing. Timing and location are "hollow" in the above list. An ad directed ad people in San Francisco may or may not have any application to my situation. However an ad or offer that has to do with "my tastes and interests" may require location to be relevant and actionable. I can't attend a movie premiere or retail sale happening in another city.

Timing is also an important variable. A discount offer for a restaurant or bar may be more or less relevant depending on time of day and/or day of week.  

The larger point is: multiple variables help make ads more actionable and relevant. And most transactions are conducted or fulfilled offline, so location becomes a way to lead people to a transaction unless it's a pure ecommerce event.

An ad for a new product -- a sound system for example -- needs to show me where I can hear, see and possibly buy the product (location) to make it more than simply a less-than-optimal awareness ad. An ad for a holiday retail sale on my phone is going to be a lot more effective if it comes with a store locator vs. taking me to a crappy mobile shopping experience on my handset. 

Some of the other data among the findings reveal that consumers often assume offline action or local fulfillment. For example, smartphone owners valued the following categories as those they were most interested in (re ads/offers): 

  1. "Content" for my mobile device (it's unclear but this might be apps, music)
  2. Movies/entertainment, including tickets (all fulfilled locally)
  3. Offering from my mobile service provider (perhaps hoping for a discount)
  4. Retail store (95%+ offline purchase probability)
  5. Computers and technology
  6. Travel or vacation (likely e-commerce transaction that pertains to location)

So when we "peel back the onion" on the data, what we see is that people want relevant ads and offers but that location is very much in the background or an assumed feature of the offer.

Perhaps the most interesting and significant data form the survey concerns the most desired marketing "channel" or ad delivery mechanism. The survey question asks, "Which of the following channels for delivering ads to your mobile phone about a product/service would make you more likely to learn more about or purchase the product/service?"

Screen shot 2011-08-10 at 10.42.55 AM

Among smartphone owners the top responses were the following:

  1. Mobile coupon
  2. Text message (after opt-in)
  3. Mobile email
  4. Ad on mobile site 

Amazingly smartphone users were more interested in SMS marketing messages than feature phone users.

The big conclusion I draw from the data above is that mobile users are interested in saving money (coupons) and essentially want control over the marketing messages they receive (opt-in SMS, or email). Thus these types of ads are likely to be most effective. However, again, the survey is measuring attitudes and not behavior. 

Report: SonyEricsson Android Owners Click Ads Most, HTC Least

Ad network Jumptap released its latest "MobileSTAT" data dive for July. This month's newsletter focuses on Android but also contains general metrics from the Jumptap network. There's a link to a write up of the June data at the bottom of this post.

In the latest issue of its newsletter Jumptap has created a map that shows where Android, iOS and RIM handsets "overindex" by state. This aspect of the report is getting lots of coverage. However the data are little more than a curiosity with few practical or actionable implications. These data may also not actually reflect the sales distribution of the various OS handsets because the Jumptap network is not necessarily representative of the mobile Internet as a whole or used equally by a representative group of mobile subscribers.

Screen shot 2011-08-05 at 8.34.04 AM

More interesting are the other metrics in the report. For example, Jumptap showcases Android handset CTRs by device type and by carrier. CTRs for Android devices are generally consistent across carriers (averaging about 20%). But there appears to be wide variability in display ad CTRs according to handset type. There's no satisfactory explanation offered for the variation in CTR performance by handset.

Screen shot 2011-08-05 at 8.34.13 AM

Screen shot 2011-08-05 at 8.34.33 AM

Jumptap says the following about why Android SonyEricsson handset owners generate the highest CTRs:

We speculate Sony’s relatively high CTR is due to their positioning as a premium brand, but don’t rule out the role that usability, hardware and interface may have.

By contrast I would speculate that LG and SonyEricsson handset owners are late Android adopters, while HTC and Motorola handset owners are earlier adopters and so less inclined to click on ads than Android neophytes.

The following is Jumptap's CTR chart by age, showing that those between 55 and 75 click the most. 

Screen shot 2011-08-05 at 8.35.20 AM

Compare the data from June: 

Screen shot 2011-06-30 at 5.30.39 PM

These data are likely impacted by a higher number of "unintended clicks" and/or lower mobile sophistication levels in these older age groups. 

Jumptap also said that 61% of the campaigns on its network are targeted in some way (vs. 49% in June). The chart below shows the breakdown of targeting methods. Note that "location" is only used by about 18% of advertisers using any form of targeting. 

Screen shot 2011-08-05 at 8.34.50 AM

Finally most advertisers on Jumptap's network appear to be sending people to mobile websites or landing pages. Jumptap speculates that this reflects growth in the number of mobile websites. It's a safe bet however that the entire "click to Web" group is not sending users to optimized mobile sites or landing pages.

Screen shot 2011-08-05 at 8.35.11 AM

A substantial number of these "click to Web" mobile marketers may be unsophisticated, however, and simply sending users to their PC sites -- incorrectly assuming that the smartphone browser does a good job rendering them.

See also: Selective Zip-Level Targeting Produced 85% Lift.

HipCricket Acquired by Little-Known Augme

Yesterday Augme Technologies, which recently purchased 2D barcode marketer JAGTAG, announced the acquisition of SMS mobile marketing pioneer HipCricket. The purchase price of was $44.5 million ($6 million in cash and $38.5 million in Augme stock). There's also an earnout that could yield an additional $27.5 million.

The HipCricket team will be retained by Augme, which has been until now an off-the-radar mobile marketing company. The addition of HipCricket, together with the JAGTAG assets, will provide a revenue boost and a new client base, as well as a broad array of tools and new capabilities. 

HipCricket began as an SMS-based marketing platform in 2004 but more recently started to offer a wider array of mobile marketing capabilities, as well as launching an ad network. HipCricket clients include Nestle, Macys, ClearChannel, Coors and others. 

The structure of the deal (mostly stock from a little-known company) suggests that HipCricket was actively trying to sell itself.

Placecast Opens Up Geofenced Marketing to Self-Service

Placecast has introduced a self-service version of its SMS and MMS ShopAlerts marketing platform. The platform enables template-driven campaign creation, with extensive control over the radius of geofenced areas as well as the time and dates of message delivery.

This means that any merchant, franchisee or small businesses could potentially utilize the Placecast platform to deliver geographic-based push messages and promotions to opt-in consumers. It's going to be challenging for small businesses as a practical matter. But it's particularly well-suited to franchise businesses and can handle multiple locations with ease. Distribution is up to the business or entity, which would need to capture the opt-ins (similar to follow us on Twitter or Like us on Facebook).

Messages or promotions can be built around deals and offers but don't have to be; there are many other types of content that can populate these messages.  

Placecast works with O2 in the UK and AT&T in the US, as well as individual retailers. The O2 program has seen great success in the UK; the AT&T program is still in very early stages. Unless carriers are going to buy ad networks, the ShopAlerts/O2program is the model for carrier-based advertising -- although it's not apparent that the carriers see that clearly.

Screen shot 2011-07-21 at 11.15.11 AM

The original beta version of the ShopAlerts program, tested with selected retailers in the US in late 2009 and early 2010, yielded impressive results:

  • 60% of participants found the location-triggered messages to be cool & innovative
  • 79% said it increased their likelihood to visit a store
  • 65% made a purchase as a result of a ShopAlerts message (though not necessarily in real time after receiving the SMS)
  • 73% of participants would definitely or probably use the service in the future

Agencies and companies often neglect SMS as a marketing medium and CRM tool. Even with smartphone penetration nearing 40% in the US that still means that 60% of users don't have them. SMS penetration and usage are nearly 100%. 

Related posts on Placecast: 

Mobile Numbers from the Google Q2 2011 Earnings Call

Below are the substantive comments made by Google CEO Larry Page and other Google executives about Android and mobile from yesterday's Q2 earnings call. I've cut out all the bloat, PR spin and puffery.

Google CEO Larry Page: 

I actually have a new metric to report in Android of 550,000 phones activated a day. And that's a huge number, even by Google standards. 

There's over 400 such devices, 39 OEMs, 231 carriers in 123 countries, and over 78 open handset alliance partners. 

[D]espite the efforts of some of our competitors, there hasn't been any slowdown in any of those things. And partners and developers are continuing to expand the Android ecosystem.  

Nikesh Arora, SVP and Chief Business Officer:

One format which was launched by Susan's team called Click-to-Call or Click-to-Share has been particularly successful. Unilever is a great use case of these formats. They integrated our AdMob product into a very large campaign of launching a new product to use the banner to drive traffic to a campaign Mobile site and achieve unprecedented results with almost 700,000 unique visitors accessing their content. 

Susan Wojcicki, SVP of Ads: 

Voice Search traffic for Mobile devices is up 6x in the past year.

There are now 135 million Android devices that have been activated in total, up from 100 million just 2 months ago. There are also now over 400 different Android devices available globally. Android market is also picking up momentum. It has over 250,000 different apps, and users have downloaded apps over 6 billion times, which is double the downloads from just a few months ago.

Mobile Display is starting to take-off too with traffic on the AdMob network up more than 3.5x in the past year. 

____

The comment by Larry Page above, "despite the efforts of some of our competitors," refers to patent attacks on Android. Right now Oracle is involved in Java-related litigation with Google over Android; and Microsoft is trying to force licensing deals on Android OEM partners.

Some financial analysts have suggested that Microsoft is getting about $5 per every Android device sold by HTC though such a licensing deal. Microsoft wants Samsung, now the largest Android OEM in the world, to pay up to $15 per Android device. There's speculation that the company is using that figure partly as leverage to get the Korean company to better commit to Windows Phones. Samsung has only tepidly embraced Windows Phones. 

While both Nokia and Microsoft await the formal release of one of their jointly produced handsets both companies continue to suffer at the hands of Android.

Nokia's share is falling like a rock and Microsoft's handsets are selling here and there but not in big numbers. Licensing revenue for mobile devices is clearly "Plan B" for the company. And while it could pay off in revenues over time that's much less desirable selling actual mobile devices.

In addition the more Android devices sell, the more Microsoft loses its grip on the overall OS market. Indeed, it's less and less "important" to have a Windows-based device in the more heterogeneous cross-platform market that exists today than it was when there were only Apple Macs and Windows-based PCs. 

Android Has 16 of Top 20 Phones on Millennial Network, Tablets Cannibalizing PC Usage

Millennial Media's Mobile Mix monthly device report is out this morning. And once again I'll excerpt what I think is interesting. First here are some of the top bullets, representing trends the company is seeing on its mobile ad network:

  • The iPhone was the top individual device (for a long time now). However Android was the "leading OS on our network for the 7th consecutive month  . . . Android also had 16 of the top 20 mobile phones."
  • iOS impressions (iPhone, iPad, iPod Touch) grew 18% vs a year ago. Android impressions grew 11%.
  • Windows Phone impressions grew 31% quarter-over-quarter; RIM impressions grew 29% quarter-over-quarter.
  • Connected devices (iPod touch, etc.) and tablets (iPad) accounted for 18% of all impressions on the network

The share of impressions being generated by smartphones is basically flat. In March 2011 smartphones were responsible for 64% of the impressions on Millennial's network. Today, in July, it's 65%. 

Screen shot 2011-07-15 at 5.34.25 AM

So-called connected devices constitute 18% of Millennial's impressions. This month Millennial has included some InsightExpress data that addresses tablets. In the chart below are behaviors that have shifted to tablets or have been impacted by the acquisition of an iPad or other tablet device:

 Screen shot 2011-07-15 at 5.34.42 AM

These numbers are lower but consistent with other data showing that tablets do cannibalize some PC usage. Below are data from a Google-AdMob survey on the same question: 

 Picture 27

Nielsen offers similar data (May 2011): 

Now back to the Millennial data. In May iOS had a 27% share of impressions but was responsible for 45% of revenue on the Millennial network. This month, iOS's share is 26% but revenues generated are 49%. Accordingly from a revenue standpoint iOS continues to "outperform" its share percentage, while Android "underperforms": 54% share, 41% of revenue generated. 

Screen shot 2011-07-15 at 5.35.01 AM

Among the top 20 handsets that Millennial sees, there are three RIM devices and the iPhone. Otherwise it's all Android. This is an amazing story.

Google CEO Larry Page said yesterday on Google's earnings call that the company was activating 550,000 devices a day. The company also disclosed that there were a total of 135 million activated Android devices in the market. There are a total of 400 Android devices in the market.

As of the end of Q2 2011 Apple had sold a total of 189 million iOS devices, including iPod Touches and iPads. 

UK Carrier O2 Seeing Success with LBS Offers

UK carrier O2 (owned by Spain's Telefonica) is seeing great success with its opt-in SMS marketing program O2 More. The location-based service is powered by Placecast, which also supports a similar but more nascent program in the US for AT&T. (It's not clear how much promotional effort AT&T is putting behind it.)

O2 not long ago announced it had more than two million subscribers for More. Consumers sign up for the O2 program, specifiy interest categories and recieve no more than a single text per day. The program sees very low churn. 

Earlier this month the UK carrier touted the success of a More campaign for gym Fitness First:

Fitness First targeted O2 customers with location-based messages offering a free two-day pass and details of the nearest club. This resulted over 1,100 recipients signing up as new members of Fitness First on four month and 12 month contracts.

With average membership costing just under £300 per year, this uptake generated increased revenue around £400,000.

The best responding target audience was 18 to 35-year-old smart phone using single Londoners, who enjoy engaging through social media.

US carrier T-Mobile recently got into the daily deals market with the launch of an app called "more for me." But with much larger competitors -- and so many competitors -- it's unlikely that T-Mobile will see great success with the program.

However daily deals could be converted into SMS messages for broader distribution and differentiation. Indeed, the O2-Placecast model is a stronger bet than an app strategy for carrier advertising, and can reach 100% of the carrier's customers potentially.

Many marketers and companies tend to look "beyond" SMS to in-app ads and mobile Web advertising because SMS isn't sexy. (Just like text ads in search aren't sexy.) However the reach of SMS is 100% and the response rates to opt-in text messaging programs can be huge. 

For example, in early 2010 Placecast found the following in its US beta test of ShopAlerts (the same kind of program run by O2): 

  • 60% of participants found the location-triggered messages to be cool & innovative
  • 79% said it increased their likelihood to visit a store
  • 65% made a purchase as a result of a ShopAlerts message (this sometimes occurred on the same day and sometimes later)
  • 73% of participants would definitely or probably use the service in the future

Apple's iAd Cuts Prices but Sees Defections

There's a great deal of analysis and even schadenfreude going on over the news that Apple's iAd unit (formerly Quattro Wireless) "has cut rates by as much as 70 percent as some marquee clients are using rival services . . . signaling the company is struggling to parlay its technology leadership into success in the ad industry." 

According to Bloomberg: 

Apple has cut the minimum ad purchase from $1 million to $500,000, and it’s offering agencies deals for as low as $300,000 if they bring together multiple campaigns, the two people [familiar with the matter] said. 

What people fail to realize is that iAd is effectively a very high profile "proof of concept" for mobile display advertising. It lent enormous credibility to mobile advertising with brands and got them to bet six and seven figures on mobile, which they had not before. 

It also compelled rivals to develop richer ad formats. All of these things are good for mobile advertising in general.

I don't believe that Apple ever saw mobile advertising as a significant revenue stream for the company, however. It was more about supporting developers and enabling them to make money -- having control over a revenue stream for the iOS ecosystem. But that concern has substantially subsided. Apple's developers have access to multiple ad networks.

In the end it really doesn't matter whether Apple gets $300K or $500K up front. It just matters that advertisers are spending that money somewhere in mobile. 

Related iAd posts: 

App Downloads Show Complexity of Mobile Usage: It's Not All about Local

Many people (including some analysts) make simplistic assumptions about the mobile market: for example that mobile and local are all but synonymous. I'm obviously a big advocate of local but I see mobile usage as quite complex and defying easy conclusions about usage or the future direction of the market.

There are lots of functions and activities that people perform and do on mobile handsets that have nothing to do with their immediate surroundings or local. For example: games, news, entertainment, music, sports, social networking and so on.

A new set of Nielsen data about app downloads/usage in the past 30 days reflect that mobile is a platform that is complex and diverse in its usage. While local content and apps are well represented in the hierarcy a large number popular app categories have nothing to do with location.

Instead they probably reflect that people are using mobile as a "generic" Internet access tool. Games, the most popular category, is a phenomenon unto itself. 

http://blog.nielsen.com/nielsenwire/wp-content/uploads/2011/06/mobile-gaming-chart-1.gif

Most purchases occur in the physical world. So most mobile ads will either direct people to actual stores or, in the case of most future display campaigns, offer a dealer or store locator -- at a minimum. Mobile will be a huge branding medium, irrespective of any localization component. And there will be many awareness ads that have a location component as secondary or perfunctory matter. 

Moreover we get into an "accounting" problem in defining what is a "local" ad in mobile.

Is a Klondike Bar ad that contains a store locator buried two clicks down a "local ad"? What about mobile click-to-call ads for a florist network, which sends users to call center to place an order fulfilled locally? Is a mobile-video brand campaign for Hilton Hotels that can direct you to the nearest property if you initiate a search or lookup?

There's a lot of gray in determining what is a local ad. We might want to "require" localization in the ad creative before we consider mobile ads as "local." Just a thought.

But just as people often fail to recognize how local or offline purchase intent permeates a great many things that happen on the PC it's equally the case that non-local activity/interest is very much tied up in mobile activity. The chart above nicely illustrates that. 

Report: Mobile Ads Show Better Performance than PC for Display -- Across the Board

MediaMind, formerly Eyeblaster, released the results of an extensive study examining roughly 230 million mobile ad impressions in Q4 2010 and Q1 2011. The company affirms or confirms that mobile outperforms PC for display advertising. There's no search data in this report but it's also true for search CTRs. However there are others who have data that contradicts these claims (e.g., iCrossing). 

Below are some of the top-level findings in the report: 

  • Apple’s iOS beat Android by 2X in terms of ad performance, RIM by 5X (this is consistent with other data in the market; e.g., Smaato and Jumptap)
  • Mobile ads saw a CTR of 0.61%, while PC banners see/saw a CTR of .07%.
  • PC activity peaks during between 9 am and 5 pm, mobile browsing soars during the evenings (there's lots of data on mobile dayparting in the market, some of it inconsistent).
  • Mobile CTR reaches its peak during the evening, but is higher than PC CTR at any time of the day.  
  • Mobile CTR is also above average between 7pm and midnight, peaking at 8pm. 
  • Top performing mobile verticals: entertainment, retail, financial, B2B (surprise), travel. Restaurants, the top local-mobile search category, was lower on the list

There's a big practical mobile advertising takeaway from the report: "Serving ads in the evening can prove much more effective as compared to earlier in the day, and can reduce the cost per click of mobile."

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Selective Zip-Level Targeting Produced 85% Lift

Mobile ad network Jumptap released its second MobileSTAT issue for June earlier today. It's very much like the Millennial Media SMART reports or the AdMob Metrics reports that began the trend. There are a range of interesting findings in the document; I excerpt and summarize some of that material below.

Among smartphone operating systems, Android leads the iPhone by a margin of 42% to 30% on the Jumptap network. This 12 point margin is consistent with the Nielsen-reported 11-point margin between the shares of the two operating systems in the broader US mobile market. 

Screen shot 2011-06-30 at 5.27.59 PM

Compare Nielsen's data released earlier today:

http://blog.nielsen.com/nielsenwire/wp-content/uploads/2011/06/mobile-OS-share2.png

A relatively unique piece of data in the report is the "content consumption" breakdown between apps and the mobile Web (below). There's no discussion of this graphic in the report so one would need to speculate on whether this is based on where Jumptap ad impressions were served or whether this is somehow a broader measure of consumption trends on mobile devices. 

Screen shot 2011-06-30 at 5.29.18 PM

According to a recent report from mobile analytics company Flurry, which some have disputed, mobile apps have overtaken the Web (PC and mobile) in time spent. Regardless of whether that's precisly accurate, plenty of data indicate users are spending increasing amounts of time with mobile apps. 

There's also considerable data in the report about CTRs on mobile ads. The first graph immediately below shows Jumptap's CTR by smartphone OS. The Apple iOS platform shows CTRs that are almost double those of Android and other platforms except the Palm webOS. 

Screen shot 2011-06-30 at 5.29.12 PM

Mobile ad exchange/mediator Smaato offers a similar chart (global, Q1 2011), which shows Windows Phones leading the CTR pack followed by Symbian and then Apple, et al.  

Operating System Click Through Rate Worldwide Q1 2011

Jumptap also said that people between 50 and 70 years old clicked on more ads than members of other age groups. This is an interesting and somewhat curious finding. I would be interested in seeing age-CTR segmentation data by handset type. I suspect that for smartphone owners it would skew younger. 

Screen shot 2011-06-30 at 5.30.39 PM

Mobile subscribers with incomes above $50K clicked on ads quite a bit more than those with incomes under that threshold. Again I would suspect that higher incomes correlate positively with smartphone ownership and that's going to factor in to this data.

Screen shot 2011-06-30 at 5.31.08 PM

There's now a fair amount of data from various sources about what time of the day/week mobile users are most active. In the Jumptap chart below ad clicks start to grow in mid-morning (with increased mobile activity generally) and peak at about 6pm. 

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Local-Mobile network Verve Wireless also recently put out findings about consumer behavior on its network. The company said that nearly 60% of page views on its network occurred during the afternoon commute hours and in the evening (between 7-10pm).

Another very interesting data set released by Jumptap is based on a mobile ad campaign with "a major auto advertiser," which targeted selected, demographically qualified zip codes "that are more likely to purchase their brand." According to Jumptap these zip-based ads showed terrific lift "over ads broadly targeted in almost every campaign" -- as much as 85%. 

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The final bit of data I'm including from the report shows the "post-click activity" or objectives of advertisers. Sixty seven percent of users clicked from an ad to a mobile Web-based landing page (or site), while 18% clicked to call and 15% downloaded something (probably an app).

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Because we don't now when it says "click to Web" whether these are just PC sites on a mobile browser or HTML5 optimized landing pages we can't evaluable how sophisticated these advertisers are. As a general matter however I would speculate that we'll see a movement away from "click to Web" as marketers try and maximize the effectiveness of their mobile campaigns. 

Verve: Local Mobile Spend Grew 82% YoY

Verve Wireless is a San Diego CA-based mobile ad network consisting of approximately 1200 local media sites (mostly newspapers). The company's network features both small business and national-local advertisers; and it has created and released the first of what will apparently be quarterly reports focused on local-mobile advertising and consumer behavior.

Verve is calling the quarterly report the "Local Mobile Index" (LMI). The ad inventory measured is all mobile display. Verve says the data presented in its inaugural report are a mix of "Omniture, comScore and Verve reporting." The data can be compared to what Millennial Media is doing with its SMART reports but at a purely local level.

As with all such network-based data the Verve report must be seen as a reflection of what's happening on the company's own network primarily. However it's large enough that these data are going to be directionally reflective of larger trends in the local-mobile market.

Top ad verticals

Top five local-mobile ad verticals on the Verve network (Q1 2011):

  • Autos
  • Real estate
  • Entertainment
  • Banking 
  • Health care

Compare Millennial Media's top 10 verticals by ad spend for Q1:

  1. Retail & Restaurants
  2. Telecommunications
  3. Portals & Directories
  4. Finance
  5. Automotive
  6. Entertainment
  7. Dating
  8. Education
  9. Travel
  10. CPG

Spending growth

According to Verve the local ad spend grew 82% year over year (Q1 2010 to Q1 2011) for the identical inventory in its network. This growth rate is in line or somewhat higher than general mobile spending growth. For example, here are eMarketer's mobile ad growth projections:

In the table immediately above, eMarketer said that mobile display grew 122% in 2010 but will slow to 65% annual growth in 2011. I believe it's too soon to argue that mobile ad growth will slow, however, and believe these figures are somewhat conservative. 

Dayparting

About 56% of page views on Verve's network occurred during the afternoon commute hours and in the evening (between 7-10pm). The chart below reflects mobile usage throughout the week.

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These data seem to contradict other mobile data that show weekends as a time of heavy mobile activity. However this might be explained by the fact that most of Verve's sites are newspaper sites and that consumption of these sites may decline on the weekend. 

Ad performance

Verve said that in-app ads outperformed mobile web ads "by a factor of nearly 3x (2.67)" during Q1 2011. This is not a surprise given higher levels of consumer engagement with apps vs. the mobile web.

In addition, according to Verve, "rich media campaigns out performed standard banner programs, as measured by consumer engagement, by a factor of 7:1." However some rich media ads that launched video from the banner "performed worse than those without video or had video embedded in a landing page (1.61% video banners vs. 2.67% video embedded), which may indicate some reticence on the part of consumers to go straight into video without an intermediate step." 

Top cities

Perhaps the most interesting data from Verve's report is the list of top DMAs by ad revenue. Here they are and they feature some surprises: 

  1. St. Louis
  2. Houston
  3. New York 
  4. San Francisco  
  5. Portland
  6. Denver
  7. Memphis
  8. Seattle
  9. Dallas
  10. Cleveland-Akron

Texas is the top state by ad revenue in Verve's network. 

Here's a situation where the data from Verve's network may diverge significantly from larger trends in the market. It's very unlikely, for example, that St. Louis is the top overall DMA for mobile ad revenue in the US. What's more plausible is that the sales reps in that market have had great success selling mobile to their advertisers (Verve does some national ad sales). 

iPhone vs. Android

The iPhone represented nearly half of all traffic on Verve's network. However the company said that Android users were more engaged. Verve doesn't elaborate on the meaning of this statement in its report but says that "Android achieved 52% better engagement results during the quarter." 

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It's also interesting that BlackBerry had nearly as much share as Android on Verve's network. This is probably a reflect of the legacy of numerous RIM devices in the market.

There hasn't been much good local-mobile ad spending data in the market prior to this. So it will be great to see these quarterly reports and assess how the market is doing based on "facts on the ground." Most of the forecasts (though not all) about local-mobile released to date have been based on very high-level data and often incorrect assumptions about the market.

T-Mobile Becomes Daily Deals Aggregator

T-Mobile USA is becoming a deals aggregator, with a new Android app called "More for Me." It's available today for any Android smartphone running OS 1.6 or higher. LivingSocial is the only deal source mentioned although the word "aggregator" implies a broader array of sources. 

T-Mobile claims that the app is the first of its kind from any US mobile carrier. AT&T (the would-be owner of T-Mobile) similarly aspires to be a major player in the deals space and has a existing relationship with Placecast to deliver geo-fenced "shop alerts." That's not the same as "daily deals," but it's location-based discounts and offers nonetheless. 

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According to the T-Mobile press release:

The T-Mobile More for Me application is customizable, enabling consumers to find the most relevant deals, closest to their exact location. Users have the opportunity to see deals from a variety of retailers, in nearly any city, with many deals tailored to meet their specific interests and preferences.

“LivingSocial works directly with merchants in all of our 260+ global markets to craft great deals that drive our valuable members through their door,” said Jake Maas, senior vice president, corporate and business development, LivingSocial. “We are excited to bring our handpicked experiences to the millions of consumers who will enjoy T-Mobile’s new More for Me app.”

What's unique here is not that T-Mobile has built a deals app or even that it's created by a carrier. Rather it's the idea that a carrier is creating an app extending beyond the borders of its own subscriber network. Given the availability of branded deal apps from Groupon, LivingSocial and others, however, it's very unlikely that More for Me will see much adoption beyond T-Mobile subscribers. 

Study: Mobile Display 'More than Doubled' in Past Two Years

ComScore did an analysis of mobile display advertising in April and said that "the number of advertisers using mobile display ad campaigns has more than doubled in the past two years." The measurement firm said that "689 advertisers used mobile display advertising campaigns to reach consumers [in April], up 128 percent from two years prior."

I would take all this as "directional" more than as a completely accurate reflection of the number of mobile display advertisers. It reflects significant growth in US mobile display, although we should see growth accelerate as more advertisers move into mobile and it becomes easier to buy online and mobile display together. 

Below is the category breakdown of those advertisers in April according to comScore: 

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For comparison, here's what Millennial Media has said are the top ad categories on its network (Q1 2011): 

  1. RETAIL & RESTAURANTS
  2. TELECOMMUNICATIONS
  3. PORTALS & DIRECTORIES
  4. FINANCE
  5. AUTOMOTIVE
  6. ENTERTAINMENT
  7. DATING
  8. EDUCATION
  9. TRAVEL
  10. CPG

Millennial: 21% of Mobile Users Made a Purchase in Past 30 Days

There's already a great deal of data in the market that show consumers use smartphones throughout the "purchase funnel." Several studies have also affirmed that well over 50% of smartphone owners are searching or conducting product-related research in stores at the point of sale. Most advertisers, however, have yet to respond to this rapidly evolving behavior with the kind of commitment it deserves.

By the same token increasing numbers of advertisers now do take mobile much more seriously and are starting to devote meaningful budget allocations to the platform. Helping to advance the argument for mobile is Millennial Media, with new research combining data from its own network with custom comScore research that takes a look at mobile consumers and the retail vertical.

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Of course the study is self-serving. But the findings are consistent -- even "conservative" in some cases -- with other third party studies. Some of the findings (mostly collected in 2010) were teased in the most recent Millennial SMART report. 

Millennial said that in Q1 2011 the market segment it calls "retail & restaurants" was the top-spending advertiser category in the US market: 

  1. RETAIL & RESTAURANTS
  2. TELECOMMUNICATIONS
  3. PORTALS & DIRECTORIES
  4. FINANCE
  5. AUTOMOTIVE
  6. ENTERTAINMENT
  7. DATING
  8. EDUCATION
  9. TRAVEL
  10. CPG

On Millennial's network that category saw 1342% growth from Q1 2010 to Q1 2011. According to comScore data, the number of US-based retailers doing mobile advertising went from 3045 retailers in 2009 to 6445 in 2010 -- in other words, it doubled. 

Beyond this, much of the Millennial-comScore report is devoted to consumer data and behavior. The finds reflect that the majority of US consumers accessing retail content on mobile devices (typically smartphones) are between 18 and 35 years old and generally more affluent than average mobile users.

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Millennial reported that "the number of consumers who accessed some type of retail content on their mobile device in a given month jumped 74% year-over-over to 13 million (as of June 2010)." Of that group:

  • 6.5 million people accessed retail content "up to three times per month"
  • 4.2 million at least once a week
  • 2.2 million consumers almost every day 

My view is that these figures probably under-count the number of mobile consumers accessing what might be described as "retail content" on their phones. By analogy, the comScore estimate (as of Q2 2010) of smartphone ownership is 22%; but the most recent Nielsen estimates put the number of smarpthone owners at 36% of all mobile subscribers in the US. Accordingly, the figures in the Millennial document are probably "conservative."

There were additional findings about "m-commerce" and products purchased via mobile devices. The comScore data reflect that "21% of survey respondents said they had made a retail purchase using their mobile phone via a mobile browser or a mobile application in the past 30 days." The graphic below shows the hierarchy of those product categories according to comScore and Millennial. 

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It's interesting to compare the above mobile purchase categories to the content categories (below) accessed by mobile users. The red/brown bar is "mobile retail users." 

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In the end the data in the report affirm that mobile is a critical channel for retailers and brands. The "why" of mobile is certainly behind us; what lies ahead are all the tactical and more subtle questions about best practices and integration of mobile into larger digital and brand advertising campaigns.

Millennial: Local Targeting Continues to Grow

Millennial Media released its latest SMART report on mobile marketing trends and data. In the issue, Millennial focuses on growth in the retail vertical (compiled by comScore for Millennial) as well as its traditional range of metrics (e.g., campaign objectives, landing page composition).

In particular, the report says that "local market targeting grew 22% and represented 56% of all campaigns that used targeted reach." While targeting is growing, the majority of Millennial's advertisers appear to still be most interested in broad reach and driving awareness.  

Local can mean different things on Millennial's network: targeting by state, city, zip. However the company also said, "advertisers in the Automotive and Restaurant verticals leveraged Local Market targeting to drive foot traffic into their brick-and-mortar locations through targeted regional promotions." 

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Millennial says that retail "content consumption" by consumers on mobile devices is growing in aggregate volume and frequency:

  • The total number of consumers who accessed some type of retail content on their mobile device in a given month jumped 74% year-over-over to 13 million (as of June 2010)
  • Of the 13 million, over 6.5 million accessed retail content on their mobile device one to three times per month, 4.2 million at least once a week, and 2.2 million consumers accessed some form of retail content on their mobile device almost every day

 Screen shot 2011-06-03 at 7.06.30 AM

Below is the hierarchical mix of retail advertisers on Millennial's network: department stores followed by computer/electronics retailers (e.g., Best Buy) and home & garden retailers (e.g., HomeDepot). 

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