Millennial Media this morning announced $27.5 million in new funding from Bessemer Venture Partners, Columbia Capital, Charles River Ventures and New Enterprise Associates. This brings total funding of Millennial to over $65 million.
The company said that it would use the money for growth (especially international), technology investment and targeted acquisitions. Millennial also said that the company grew revenues 3X in 2010 over 2009. That partly reflects Millennial's particular success as well as the mobile ad industry's general revenue growth.
Mobile advertising and marketing growth will accelerate in 2011. Currently the overall number is just under $1 billion in the US.
IDC's revised its US mobile ad numbers in December. They depict Millennial as the number three mobile display network, after Google (#1) and Apple (#2). Currently Millennial operates in 250 countries globally and says it reaches 85% of the mobile Internet audience in the US (now almost 90 million according to Nielsen).
Millennial is a future candidate for an IPO but also could be an attractive takeover target as well. However the new funding makes the company more expensive to would-be acquirors.
See related posts:
In creating FaceTime Apple brought a differentiated feature to the iPhone 4: video calling. However it only works over WiFi. Fring stepped up to offer it over 3G but the company is relatively obscure outside tech circles. But now that Skype has added video and 3G support for the iPhone, it's truly poised to become a mainstream phenomenon.
Here's what the updated app does according to Skype:
Skype also repeated a stat about its usage: "approximately 25 million people [are] signed into Skype at any given time." That's a lot of people but a much smaller number than the broader group of "registered Skype users," numbering in excess of 400 million globally.
I haven't yet tried it and don't know how good it is but I suspect it will be extremely popular.
Once the iPhone comes to Verizon it will be interesting to see how Skype is handled. Currently Skype calling on Verizon's other smartphones (e.g., RIM, Android) counts against voice minutes, which makes no sense from a user point of view though it does from the perspective of a carrier worried about users circumventing or sidestepping the limits of its voice plans.
Millennial Media is out with its November SMART report. This month there's a focus on the financial services vertical.
Despite the rise in mobile banking it's not a category that one would automatically assume is well suited to mobile advertising and marketing. However Millennial reports that the category has seen more than 800% YoY growth in ad spending on the Millennial network. Perhaps that speaks to the versatility of mobile as an advertising medium.
Below is a graphic that reflects the breakdown in ad spending by sub-category.
What's also interesting is the wide mix of actions that these advertisers were trying to elicit from users. Top actions were "place call" followed by form submissions (lead gen) and application downloads. However the range of objectives and actions is very broad, including driving to fan pages, video and store locators/maps.
Turning to the broader mix of campaigns about half of those appearing on the Millennial network were targeted in some fashion with geo-targeting (broadly defined) being the most common form.
Compare June, 2010, when targeting was somewhat less on a percentage basis:
It may also be the case that on landing pages the broad reach campaigns are also refining or assisting targeting in some way -- for example with store locators.
According to IDC's revised US mobile ad numbers Millennial is third in mobile display, with a 15.4% share:
Millennial says it reaches 8 out of 10 mobile Web users.
Most people associate "location based services" and apps with deals: check in get a coupon. And there are lots of scenarios like that out there today. But these apps and checking in are also about CRM/loyalty marketing and "brand engagement," although that's much less widely discussed or maybe even less well understood.
LBS is about building a relationship with a brand or company as much as one-off transactions. There are a number of examples of this but a particularly good one is Pelago/Whrrl's case study with gas station and convenience store Murphy USA. Here's Pelago's write up of the case and the results.
Here's a short summary of the objective and tactics:
Murphy USA (which operates more than 1K locations in the US) "wanted to expand their presence into social and location as a way to build a strong, loyal online community that spread word of mouth about their brand virally."
Murphy USA used Whrrl as the social platform and check-in tool. According to Pelago, "Murphy USA offered customers the opportunity to win $50 worth of free gas – just by checking in at their locations. To promote the offer, they used Facebook and Twitter to drive awareness and have fans join their Society. Murphy USA also had point of sale messaging at gas pumps with information on how to check in and win free gas, giving customers a compelling reason to activate at the pump."
A few results of the campaign:
- After the first few weeks of the program launch, 44% of respondents had never visited a Murphy USA gas station prior to the promotion.
- 84% of respondents told Murphy USA they chose Murphy USA over a competitor because of Whrrl’s Society Rewards program.
- The program has driven over four visits per customer per month – two times the industry standard.
- 72% of customers using Whrrl are more likely to recommend Murphy USA because of the program.
- Customers using Whrrl are spending 30 dollars or more on average per visit – this is twice the industry standard of 15 dollars per visit.
Pretty impressive stuff . . . the campaign had an impact on both customer acquisition and brand awareness/lift.
I use this as an example to make a larger point: marketers should be thinking much more expansively about LBS and check-ins and what they can do with them -- not simply about driving isolated sales or store visits with coupons.
Idle screen advertising is something that's been discussed for several years but there are no really successful implementations in market (that I'm aware of). Google may have just created the first one in the form of branded "live wallpaper." Coke has developed a pretty restrained "snow globle" holiday themed live wallpaper for Android that one can download like an app from the Android market.
It features swirling snow and some objects or characters that move around as you tilt the handset. You can also pan across a wintry town square (where's George Bailey?). Coke branding exists in the form of a building with the Coke sign and some Coke-branded delivery trucks in the background; it's pretty tasteful.
I'm sure Google will be watching the reaction. Regardless it opens the door to branded live wallpapers, in much the same way that Yahoo has now put ads on its mail log-in screen. I'm sure we'll see more of these in Q1. If they're done well and clever, users will download them. It creates a powerful opportunity for brands to be top-of-mind for users and have a persistent (and intimate) presence in a way that they would not have on any other medium.
The question in my mind is whether any functionality or further interactivity gets added to this as it evolves (e.g., push the button for the daily deal or weekly special, etc.).
Here's a video demonstrating the Coke live wallpaper:
Citigroup financial analyst Mark Mahaney almost exactly nailed the amount of search revenue Google was generating from mobile devices (about $500 million) in 2010. He's now projecting Google could see $2 billion in 2011 and potentially "over $3.5 billion" gross mobile ad revenues in 2012.
I think those estimates are reasonable given Google's assets and its already dominant position in mobile search and display -- especially mobile search. Google is on track to do about $30 billion in gross revenues this year. About 48% of that is US-generated.
IDC has Google controlling almost 60% of US mobile ad revenues between search and display, while all others combined own 41%.
JiWire is becoming a more interesting company by the day. It began as a WiFi ad network, showing location and contextually relevant ads to people logging on to WiFi hotspots. A couple of weeks ago the company acquired NearbyNow, which offers mobile app development and local product inventory information, together with a concierge service that allows users to hold products for local in-store pickup.
Today the company launched Compass ads for the iPhone, iPad and laptops. They look like conventional mobile display ads but provide very rich iAd-like functionality. Beyond that they also provide the full capability of NearbyNow's product inventory and in-store pickup service. In other words these ads are highly interactive and operate like mini-apps effectively.
Below is a set of images of how the ads look on the iPhone, for a fictional campaign. A traditional-looking mobile banner opens a highly interactive app-like ad in which users can interact with content in several ways including browsing product inventory and putting items on hold for local-store pickup:
Launch partners for the ads include Groupon, The Gap, Ritz Camera, HP and Clinique. These ads would allow retailers and brands to send users to local retail stores to purchase products.
Previously JiWire said that display ads with local ad copy provide a 40% lift vs. generic national ads. And ads with a “local call to action” have shown as much as a 120% lift. JiWire told me that it now reaches 40 million monthly uniques and is continuing to expand distribution.
Google, Telenav and Navteq have similarly introduced ads that tie into maps and can lead users to a point of sale. This is a huge opportunity in mobile to take brand or product ads and show consumers where they can buy them nearby. The effectively of this type of advertising has already been demonstrated.
It's now just a question of getting the word out to agencies and media buyers.
Millennial Media's new Mobile Mix devices report shows Android's continuing incremental gains vs. Apple. Perhaps more interesting, it also holds some positive news for Windows Phones as well.
In Millennial's top devices list Apple now occupies the top two positions (with the iPad at 7), while the most prominent BlackBerry device (Curve, formerly #2) fell two spots vs. last month's report. Similarly the Motorola Droid gained two places to now reside at #3. Collectively Android handsets now have greater share on Millennial's network than the iPhone but not iOS devices as a whole.
The share of smartphones on Millennial's network was actually down 2 points from October (61%). In November Smartphones represented 58% of the devices there. By comparison Nielsen says that smartphones are now 28% of all handsets in the US.
The relative share of iPhones vs. Android devices was relatively stable (both with 38% of impressions). They were tied at 37% last month. In the ongoing iPhone vs. Android debate and narrative there are ways to spin these data to show Android now beating the iPhone and vice versa. The takeaways from the report will largely reflect Android's gains. However, yesterday Verizon data came out that showed surprising weakness at the platform's largest carrier-partner.
Millennial's devices ranking April, 2010:
The data in the chart below show developer intentions regarding platform support in 2011. What's interesting is the relatively high level of enthusiasm (in the abstract) for Windows Phones. Microsoft has not released sales figures suggesting that the platform has underperformed and that sales are less than hoped for. But this is a bit of good news. A strong apps catalog and developer ecosystem is critical for success in the current market -- although Windows Phones de-emphasize the role of apps in the use experience.
TV is arguably still king of mass media. According to Nielsen the TV audience isn't eroding, although there's some evidence that cable audiences are shrinking and companies are losing subscribers. If it's not eroding, however, the TV (or video content) audience may well be fragmenting to some degree across multiple screens including mobile and connected devices like the iPad.
TV remains a brand's best friend, for better or worse, and many CMOs are reluctant to pull money out of TV. However, Yahoo is making a bold push for a shift in marketing dollars from TV to mobile. To that end the company has introduced new mobile ad formats for mobile and the iPad:
There's plenty of empirical evidence that mobile display and video ads perform better than their counterparts online. That's partly because of novelty but also because of share of voice and the nature of mobile media. It's not unreasonable to argue then in favor of a shift in ad dollars from TV to the iPad, for example. And mobile is really one of the only mediums that can effectively reach younger users.
The following is a Harris Poll result that shows, among media types, where consumers say they ignore ads the most. TV is in the middle.
The mobile version of the new Yahoo Local is interesting in several ways. It combines events, neighborhood-level news and deals aggregated from several sources. It's a "local discovery" tool (in HTML not an app). Discovery is making something of a comeback or new surge vs. "search" among local site purveyors including WHERE, Bizzy -- even Google (with HotPot).
The online version of the new Yahoo Local has a search box at the top of the page that takes you into Yahoo SERPs. But there's no comparable search box on the new mobile site for Yahoo Local. The old Yahoo Local was an IYP-like site that was primarily about local business listings and reviews, as well as events and other content. But POIs and business listings were the primary focus.
That's now gone from the new Yahoo Local and the mobile site. Perhaps it's a recognition that Google "owns" business name lookups and an attempt to appeal to users with a very different approach to local.
The domain "yellowpages.yahoo.com" redirects to the "old" (but currently running) Yahoo Local site. But when the Yahoo Local domain eventually kicks over to the new Yahoo Local will that mean business listings will only be available through Yahoo search? And what about all Yahoo's reviews content? Where will that end up or be displayed?
Yahoo has "Sketch-a-Search," which offers local business listings content on the iPad and in mobile. Also local business information is currently available via search on Yahoo's mobile site.
Fresh off its anointing as the king of mobile advertising by IDC, Google is starting to expose some interesting mobile advertising case studies. The first of these (or perhaps the latest) is one involving Adidas using mobile offers to drive in-store traffic or "footfalls," as they say in the UK.
A description of the campaign:
In their ad, the company [Adidas] offered customers 15% off purchases made in an Adidas store of $75 or more. Interested users could store the offer either via email or SMS.
In addition to the coupon, the ad also provided a phone number and map of a local Adidas store, giving consumers all they would need to go in-store, redeem the offer and make a purchase.
With a click-through rate 28% higher than their past mobile advertising, the mobile Offers Ads campaign doubled in-store coupon redemption and increased the average in-store order value.
Google says that it's now extending offers "to desktop computers" (general PC AdWords). These offer-based ads employ the same CPC model as other AdWords types. Advertisers are charged when users click on these ads/offers.
There are many interesting things about this. One is the business model: Google could move off it's click-based billing here. It could charge based on leads or a per-user bounty. But CPC pricing makes it simple for everyone.
Another very interesting thing is the extension of Offer Ads to the PC. This move provides a new way to track online-offline activity within AdWords. While there's not a true "closed loop," the clicking on or capture of an offer will strongly imply (like calls) that users will be going to local stores to redeem.
Another interesting thing is the way in which mobile ads are starting to influence PC-based ads. I would expect most national retailers and some categories of local businesses to experiment with and advantage of Offer Ads as it rolls out more broadly.
The folks at BIA/K have updated their mobile forecast: $2.9B by 2014 in the US. I have some critiques of their assumptions, which I won't focus on now. But there's something in the press release that raises an interesting larger philosophical question around "accounting" and forecasting in the local-mobile ad space. It's an issue I've been thinking about for the past six months and this gives me an opportunity to write about it.
BIA/K says that local will represent 69% of US mobile advertising in 2014:
BIA/Kelsey expects U.S. mobile local advertising revenues to grow from $213 million in 2009 to $2.03 billion in 2014 (57 percent CAGR). This represents 44 percent of total U.S. mobile ad revenues in 2009, growing to 69 percent in 2014.
This is a huge percentage and it begs the question: "what's a local ad?" Accordingly this is the part I want to focus on:
BIA/Kelsey defines mobile local advertising as that which is targeted based on a user’s location and/or actionable locally. Local targeting occurs to varying degrees and with different methods within each of the advertising formats examined in the forecast (search, display, SMS).
Again: "targeted based on a user’s location and/or actionable locally." Let's unpack this a bit.
Arguably all product advertising in mobile is "actionable locally." For example a mobile display ad for a Sharp TV becomes "actionable locally" if it prompts me to head into a retail store and look at or buy the set. It may or may not have a "local call to action." And over on Screenwerk I've argued for five years that product search needs to be considered a part of local because that's where most of the transactions ultimately occur -- in stores.
But transaction-location swallows almost all commerical activity and some people may feel that's too broad a concept. Similarly "actionable locally" is vague. I believe what they're trying to get at however is something like a coupon that needs to be redeemed in a store or a business service that must be fulfilled offlline.
But here's an interesting hypothetical that illustrates the challenge with this idea. What about a Gap ad (discount/coupon) in a mobile app that equally applies at all Gap stores across the US? How should this ad be categorized; is it a national ad or a local ad?
It may target audiences across the US equally and it doesn't necessarily contain local ad copy (in fact it probably wouldn't at this stage). Maybe it's exclusively for in-store purchases but maybe there's an e-commerce component (which is increasingly true for retailers: channel agnosticism). There may be a secondary or subordinate link on a landing page to a store locator. Absent any other local copy does this store locator make it a local ad? (More on that later.)
There are several considerations that are relevant to defining a local ad in a mobile context: targeting methodology, ad copy and ad format. Because users who see ads on mobile devices are always somewhere that can be pinpointed quite precisely, every mobile ad has the potential to become local in a way not possible on the PC.
Millennial Media reported that in October roughly 18% of all display campaigns it saw were geotargeted. Here "geo" is defined quite broadly to include country and state. Given that marketers can target mobile users with great precision, what level of geo is required before we call an ad local?
Does an ad need to be targeted down to the DMA or city level to be considered local? Or would we be willing to call ads that target France, for example, or all of New York local? I don't have an easy answer but I would argue we'd need to get down to at least the DMA level. We could call a state-level ad "geotargeted" (because it is) but "local" implies something more narrow.
Now to ad copy. Clearly an ad that contains city-level references would seem to qualify as "local."
The ad below, from a JiWire-run campaign (online), was a national buy that dynamically inserted local references to make it appear more relevant to users in specific markets. But it did this across the US; it was not otherwise a "local" ad. There was no local call to action, no store locator; it was a pure brand campaign that happened to include location references. Is this a "local" ad?
Now back to the "store locator" issue. Recall my "first date with iAD." I saw an ad for Klondike Bars. There was nothing local in the content of the ad, except that it did offer a store locator of sorts ("find a bar"). Is this a "local" ad?
My view is that most brand-oriented ads in mobile are going to contain dealer or store finder capabilities as a matter of course. It will essentially be a "checkbox." This is because the phone and its functionality (maps) permit it -- so why wouldn't you do it? It makes brand messages actionable locally. Buick? Find a dealer. Klondike? Find a bar. Marriott? Find a room.
If we consider these local ads then more and more mobile display moves over into the "local" column. That raises a related issue: ads with phone numbers in them.
As I just argued mobile ads (whether search or display) will routinely have store locators or links to maps. But they will also increasingly show phone numbers too -- again because of the way the inherent capabilities of the handset can be invoked. Does a national, brand-centric insurance ad buy (e.g., State Farm) become local if it contains an 800 number that routes calls to local offices? What if it has a dynamically inserted local tracking number but no other local element?
While an ad for a local sushi restaurant is clearly a local ad (one town, one restaurant), some of these other scenarios (national --> local) are much more ambiguous. And as I suggested, location and local ad copy will increasingly be dynamically inserted based on a national database of locations, ad copy and images. Google is already doing this in mobile today.
There's somewhat less ambiguity when it comes to search advertising but not much less.
The focus for small business will be less on buying mobile advertising per se than getting exposure broadly across platforms via channel enablers. There will be some mobile-specific activity by SMBs (e.g., Foursquare marketing, Facebook Deals) but most marketing will not be mobile-centric. Indeed, very few true SMBs will be buying PPCall ads on Google. Most of the action for SMBs in mobile will be about organic distribution.
For the foreseeable future most of the "local" advertising on mobile devices will be bought by enterprises that otherwise seek regional or national reach but local stores, dealers or outlets. Thus we return to the various scenarios above and the question of what do we consider a local ad in mobile?
It's a much harder question to answer than it seems.
Under the broadest definition of "local" the category swallows the lion's share of mobile advertising going forward. And we can manipulate the definition of "local" to make the category larger or smaller. But where we place ad revenues is less important than how consumers are interacting with mobile devices and what sort of marketing or advertising methods are effective in reaching them.
WHERE has upgraded and redesigned its mobile apps for RIM, Android and the iPhone. Rather than a "commodity" local search service, it has now become a "local discovery engine." A big part of the redesigned experience is new content ("guides") and personalized recommendations ("best bets").
WHERE is using several methodologies to make recommendations but the app first asks users to engage in very brief statement of preferences from a short menu of icons organized around the concept "play, eat, drink."
Another recently launched online recommendation site, Bizzy, confronted me with a much more extensive battery of questions about tastes, preferences and favorites. It went on too long in my opinion. By contrast the WHERE interaction only allowed me to specify five things or categories of interest -- too few in my opinion. The process took literally less than a minute. I think they've erred a bit too much on the side of brevity.
Overall the new app is quite a bit more interesting and versatile than previous incarnations. I can still do all the directed local queries (i.e., specific restaurants and other local venues). I can also browse for content and suggestions. However the new categories, "guides" and "best bests," allow for discovery of information that I might not otherwise have thought about or discovered on my own in their absence.
Guides are intended to offer ideas and inspiration. They're typically editorial lists and roundups "curated" by humans. Examples include:
Best Bets contains a list of personalized recommendations, which as mentioned are based on preference statements but also a number of other factors, including "latent semantic indexing" according to the company. All listings and content can also be saved to lists for later reference: "favorites" and "wish lists."
WHERE is also a deals aggregator and offers local coupons and deals as part of the app. It's a fairly comprehensive mix of content and features. I was also told by Nataly Kogan, WHERE consumer experience VP, that a new social layer would be coming soon. Users are currently encouraged to sign in via Facebook Connect (of course).
One of the best local URLs out there, WHERE has yet to exploit its website fully. I'm told that's coming too -- so that users can move between platforms, collect and save information and so on.
WHERE has shown itself to be impressively inventive and flexible, evolving in creative ways as the market has evolved. The new app is certainly an example of that.
Surveys asking respondents to predict the mobile future -- especially five or more years out -- should be seen as more fun or interesting than accurately predictive. Things are evolving so quickly it's almost impossible to know what the world will look like five years from now -- except to say that it will be mobile centric.
However a forward-looking survey can accurately reveal present attitudes and even aspirations or hopes for the future. And so it is with a global carrier/operator survey funded by Airwide solutions, a mobile messaging infrastructure provider. The survey was conducted in the summer of 2010, with responses from "31 leading mobile operators spanning Western Europe, Eastern Europe, North America, and Asia-Pac."
Many in the mobile advertising world dismiss or minimize SMS and see it as a kind of interim step toward a mobile marketing future that more closely resembles the PC. I don't dismiss SMS, nor do I believe that mobile will exactly resemble the PC; it's a different medium.
Survey sponsor Airwide and the carriers themselves are hopeful that MMS and SMS will be at the center of mobile marketing and advertising in the future. Clearly opt-in SMS/MMS mobile loyalty and coupon programs will continue to be vital. But whether they're at the center or the domiant forms of mobile advertising is highly debatable.
Below are selected data points and findings from the survey.
What do you expect to be the most used forms of communication and most used apps in 2015?
What will be the top 5 most used apps on the mobile phone in 2015?
How will the average consumer spend their mobile dollar in 2015?
Which 3 forms of mobile marketing/advertising will be the most widely accepted by consumers in 2015?
A few observations:
The widespread view that social networking will dominate would effectively mean that Facebook would be the dominant mobile site and potentially mobile ad platform/network. Facebook is already a dominant mobile destination and so it isn't such a leap to believe that this will continue to be so five years from now. Social networking here may also refer generically to the "socialization" of mobile apps and the mobile experience more generally: the social layer.
The finding reflected in the third chart, that "flat rate data plans" would be dominant in 2015, is quite interesting. Airwide is a UK-based company and I may be misinterpreting the answers to the question based on different terminology or received understandings (i.e., flat-rate data vs. subscription plans). But I read "flat rate data plans" vs. "subscription plans" not as pre-paid vs. contract plans but as unlimited vs other pricing structures. The US carriers at least are trying to move away from "flat rate" or unlimited pricing toward "usage-based pricing." However consumers want unlimited plans and predictable bills, which are the opposite of usage-based pricing.
Finally, the carriers see coupons and SMS/MMS as the dominant forms of mobile marketing and advertising, while search and display fall into the number three and four positions. The question asks about carrier perceptions of consumer acceptance rather than revenues or other measures. And from that standpoint it's plausible; consumers love deals and opt-in SMS-based marketing also generates high levels of "acceptance" by definition.
The language of this question, around consumer "acceptance," is carefully structured to produce just this result and suggest a future where SMS remains the dominant mobile marketing platform, consistent with the interests of the survey sponsor and the carriers themselves. But that's not necessarily what advertisers want, nor is it what will likely happen. SMS/MMS, as I said above, will remain a very important marking tool and coupons or deals will be central to the SMS value proposition for consumers -- they'll opt-in to get deals or notifications of sales events and so on.
But mobile search, display and rich media will be areas of greater focus for marketers going forward. There's also more than a hint of carrier aspiration here. In an SMS-dominanted mobile marketing world they have a role to play. By contrast, in a mobile world where search, display, QR codes and other forms of mobile advertising and marketing are pervasive the carrier's role is marginalized.
Related: There's speculation that next week Facebook could launch a mobile IM capability (including for groups). This would be a major potential blow to carrier SMS revenues going forward.
Computerworld ran a story that briefly reviews the amazing rise of Android in just three years. Android is indeed an amazing story in and of itself and for Google and its position in the mobile market.
The Computerworld article correctly attributes part of Android's gains to the massive Verizon marketing effort on behalf of its "Droid" brand. (The software has also dramatically improved since its launch.) The major omission in the story, however, is the iPhone.
More than any other market development the iPhone is responsible for Android's success. Without the iPhone Android, I would argue, would be a much weaker platform with sales not anywhere near where they are today.
ComScore, assuming the accuracy of its numbers, has charted the platform's remarkable growth in the US. If the momentum keeps up it will exceed the iPhone's overall market share next year:
Android's founding and early development work pre-date the iPhone's launch. But shortly after the iPhone came to market Android and its OEMs basically mimicked the Apple handset's look and feel and user experience, with some meaningful differences. Beyond the UX, here's the macro view of why I believe the iPhone is ultimately responsible for Android's success.
When the iPhone entered the market it shocked the carriers and presented a fundamental challenge to other handset makers. They essentially had no response. It was two years ahead of everything and anything they had at least. Android was the only viable option at the time. Symbian and Windows Mobile weren't competitive with the iPhone user experience. Microsoft grossly underestimated the iPhone. RIM's BlackBerry OS was entirely proprietary. WebOS didn't exist yet.
The only place OEMs could turn -- the only real choice they had -- was Android. And they embraced the platform with gusto.
Verizon, seeing consumers head to AT&T to get the iPhone, embraced once-rival Google and developed a brand for its Android handsets. The company spent millions to build consumer awareness around "Droid." Verizon customers (and to a lesser extent Sprint and T-Mobile customers) unwilling to switch bought Android handsets to get the experience of the iPhone without having to change carriers. Now, with more than 100,000 apps, and a rapidly improving platform Android handsets are better than "good enough" they're generally quite competitive with the iPhone user experience.
Had Apple broken with AT&T a year ago and made the iPhone more broadly available to consumers the comScore data above wouldn't look like it does. More people would be buying iPhones. (In Europe where exclusivity is gone, the market looks different than in the US.) Without the iPhone (and Apple's AT&T exclusivity) Android would just not be where it is today. Ongoing software and platform improvements are also motivated partly by Google's desire to "beat" the iPhone. There would be somewhat more complacency there if the iPhone didn't exist and Android were only competing against RIM, Nokia or Windows.
However now that a more viable Windows Phone has shown up it may divide the OEMs' loyalties, because they now have another option. It may also peel off some Android buyers. But we'll have to see. What's also interesting is that the new Windows Phones are a hybrid of the iPhone and Android: the iPhone's "coherence" and Android's multi-OEM, multi-carrier strategy.
I'm sure this is becoming more common, but I hadn't seen it previously: an advertiser driving from a mobile display ad to a Facebook page (see images below). In this case the advertiser is Visa (and the NFL) and the ad appeared on the mobile Internet HTML homepage of Yahoo.
The Facebook fan page isn't optimized for mobile so arguably it's not going to be as effective in driving fan acquisition as would be a specific mobile fan page. It could either be a test of the utility and feasibility of Facebook pages as landing pages -- or it could just be sloppy.
Previously Millennial Media reported that the following was the mix of "destinations" for mobile ad campaigns on its network:
The largest category of "destinations" was a corporate site, followed by a custom landing page and then an application download. Presumably the custom landing page is optimized for mobile and so wouldn't be a conventional Facebook fan page.
Here's the Visa banner ad and then the full Facebook landing page, which is too small to really be effective on the iPhone.
From a publisher perspective mobile display advertising is all about fill rates, ad relevance and revenue maximization. From an advertiser perspective it's all about reach and efficiency.
Just as with online, there are the networks and the mediators/exchanges jockeying for position in mobile. The Smaatos, AdMarvels and Nexages of the world are trying to provide greater fill and ad optimization (and thus revenue) for publishers. But some of the ad networks believe that they're the ones creating the value in the ecosystem and that exchanges and mediators will become unnecessary if they can provide greater fill rates and more revenue accordingly.
Google has had two incomplete mobile networks: AdMob and AdSense for Mobile. Yesterday it announced that it was partially combining them by bringing AdSense ads to the AdMob network (though not the other way at present). The algorithim will optimize ad selection to provide the best ad for the publisher. Mostly it will serve AdMob ads, but sometimes AdSense ads if there isn't a relevant AdMob ad to deliver.
In addition to greater fill rates, the new arrangement also provides greater reach for AdSense advertisers on the Google mobile display network (previously the Google content network). Google says the following about how it will work:
Publishers using a recent version of the SDK will not have to update their code. Reporting will integrate directly into your AdMob account, and you will continue to receive a single check from AdMob each month. Publishers should note that they will not be able to filter the types of AdSense ads (e.g. category, URL) that run in their app. As a result, publishers who have ad filters selected for their AdMob inventory need to opt in to receive Google ads. Publishers can check their “App Settings” tab in the Sites & Apps section of their publisher account to see if they are eligible for Google ads and opt in. Eligible iPhone and Android application publishers not utilizing ad filters will be opted into receiving Google ads as the feature is rolled out in phases over the next several weeks.
Google has still more mobile display assets over at DoubleClick and with Teracent, which can serve dynamic ad creative depending on several variables. It will be interesting to see how it all gets integrated.
I believe that eventually Google will have two marketplaces: one for text ads and one for graphical and rich media ads. I also believe that over time Google will more tightly integrate PC and mobile ad buying (which is fairly well integrated today on the search side) -- although that can never be completely accomplished because of the separate demands of the different mediums.
Already the king of search, Google is becoming a more and more formidable competitor in display on both the PC and in mobile.
Millennial Media is out with results from a new mobile developer, publisher and agency survey that shows how people are thinking about the various mobile platforms today and tomorrow. The data presented are pooled from two separate surveys conducted in Q4 of 2009 and August of this year. The outcome will fuel the "Android is taking over the world narrative," but there are more interesting data points.
There were 600 total respondents between the two surveys, based on several email solicitations. Respondents were agencies, app developers and publishers (broadly defined). The composition of the two survey respondent pools is essentially the same:
Here are the graphs:
Mobile App Platforms For Which Publishers Are Developing in 2010
New App Platforms Publishers Plan to Support in 2011
Publishers’ Expected Increase in Apps Revenue from 2010 to 2011
In Chart A, Android has gained on the iPhone. However looking at iOS (iPhone, iPad) together shows that it currently has 51% of the market vs. Android's 23%. Next year more respondents intend to support Android, probably based on anticipated continued growth and momentum.
In Chart C, we see that a majority of respondents expect to make more money off apps next year, with 31% expecting a 100% increase.
Among the more interesting datapoints presented, Window 7 is tied with the iPad in Chart B as the 2nd place platform that many plan to support next year. This response is largely based on a high level of awareness of Windows Phones, showing that Microsoft has done a good job with marketing and PR. Whether those phones are actually supported is another matter that will depend on sales.
Finally, the findings related to ad networks are interesting:
Mobile marketing platform provider WHERE.com has teamed up with small business email vendor Constant Contact to combine the benefits of mobile and email marketing. Email marketing, though "old school" compared to mobile, is highly effective and so regarded by many small businesses. Indeed, they often rate it as the most effective or one of the top three most effective marketing tools they use.
The WHERE-Constant Contact deal contemplates that WHERE daily deals and offers can be marketed to existing customers through email via Constant Contact. And the reverse is true: Constant Contact users can now reach WHERE's consumer audience and mobile ad network (a combined 50 million people) with deals and offers.
This is an oversimplification, but WHERE sees itself as the new customer acquisition platform while Constant Contact is the CRM tool:
This integration will allow small business owners to create daily deals through WHERE and market them to their current customers through Constant Contact’s email marketing tool, as well as to WHERE’s 50 million mobile consumers. WHERE merchants can also add Constant Contact’s “join my mailing list” (JMML) button to their listings, an easy way to grow their email subscriber list. The collaboration will enable Constant Contact’s customers to utilize the WHERE platform to deliver deals to their existing customers, while reaching new customers through WHERE’s location-based mobile advertising. In addition, WHERE’s recent acquisition of LocalGinger.com , a pioneer in the local group buying category, gives merchants interested in group buying deals a massive platform to help drive foot traffic.
This collaboration aspires to be a kind of "360 degree" solution for small business to help drive people from the Web into stores. Constant Contact reported that it had 415,000 paying customers as of the end of Q3. Yesterday Constant Contact released an iPhone application.
Constant Contact's customer base offers a massive potential audience for WHERE, which offers mobile landing pages and a wide array of promotional opportunities for SMBs.
Back when Apple wanted to buy AdMob for around $250 million, Google came along and spent over $700 million (mostly in stock) to keep the company away from Cupertino. Apple went on to buy Quattro Wireless and create iAd, which did Google-AdMob (and others) a big favor by adding additional credibility to the mobile display market. Now the two companies may be at it again.
Yesterday TechCrunch reported that both companies are interested in payments vendor Boku:
Both Apple and Google are engaged in conversations with mobile payments startup BOKU about a potential acquisition or a wide-reaching partnership at the very least, we’ve heard from people familiar with the talks, which are ongoing.
Google, which has to date largely botched the consumer opportunity with its payments platform Checkout, needs a payments company more than Apple. Google may also be motivated to keep Boku away from Apple for fear of falling further behind in this arena.
Accordingly, regardless of whether its Boku, Zong or somebody else, Google will make a mobile payments acquisition in the next six months (or earlier). I'm not basing this on any tip or other inside information but on logic. Mobile payments are too important for Google to sit on the sidelines.
It also needs a better in-house payments solution for the Android market, which has badly lagged in paid app sales. Developers have been unhappy accordingly; Google needs to make/keep them happy.
Apple has more options when it comes to payments and could do something in house. (NFC is reportedly coming to iPhone 5.) But it may also buy a mobile payments company as a layer on top of its installed base of iTunes credit cards. Apple previously reported that it has more than 100 million iTunes users with credit cards on file.
Regardless of who buys whom, between the two companies Apple is the one that could more quickly mainstream mobile payments than Google.
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