There's an extensive article in the New York Times about Google and mobile search. The article is mostly a feature about the evolution of Google's approach to mobile. It also discusses voice search and Goggles but there's little hard data or new numbers.
The $1 billion mobile ad run rate is mentioned as are several previously released data points. Here are a few of the stats and observations from the article:
We've estimated, using comScore and Google's own public data that between 1.9 and 2.4 billion monthly queries on Google are coming from mobile. Google has said 33% of mobile queries have local intent. That would mean that between roughly 600 million and almost 800 million monthly queries are local-mobile.
But here's the "money quote" from the NY Times' piece: “Mobile search is definitely going to surpass desktop search,” said Scott B. Huffman, who works on mobile search at Google and leads its search evaluation team. “The lines will pass, and I think they’ll pass before anyone thought they would.”
As reported last week (I was out for a short vacation) ValueClick is buying "brand-focused" mobile ad network Greystripe for an estimated $75 million. None of this has been confirmed or announced (though it's apparently an accurate report). TechCrunch says Greystripe's gross revenues will be between $25 and $30 million this year. (See below for update.)
Here's Greystripe's description of itself:
Greystripe is the largest brand-focused mobile advertising network in the US by reach. Greystripe delivers the highest engagement and most sophisticated targeting for brand marketers, the maximum revenue for publishers and app developers, and the best ad experience for users. Greystripe’s proprietary advertising platform serves billions of rich media impressions to over 30 million users of touch-driven devices through more than 3,500 application titles and mobile websites across all major mobile platforms.
Recently Greystripe released research that found roughly a quarter of iPhone and Android owners will be in the market for a new or used car in the next year and 78% of them will use their smartphones as part of the car-buying process. This research illustrates the importance of mobile as both an awareness and direct marketing medium for car-makers -- and by extension brands in general.
Last week WHERE (which operates a local ad network) was acquired by eBay. Although not a pure network, this is another indication that more consolidation is on the way in mobile.
Major independents that remain in the market include inMobi, 4Info, which recently became a "full service" mobile ads platform, Millennial Media (right now headed toward an IPO) and Jumptap. Others include Mojiva and Medialets, as well as mediators such as Smaato.
Independent Local-mobile ad network xAD is also a definite acquisition target. Because xAD hasn't done a great deal of PR for itself most people are unaware of its reach, high CPMs and overall quality. It's definitely a prize waiting to be snatched up.
Recently DataXu established the first "mobile DSP." This PC-mobile crossover will become standard in the near-term -- and ValueClick-Greystripe is an indication. To a lesser degree so is the eBay-WHERE acquisition.
Below is comScore's "Ad Focus" rankings that show the top 50 PC ad networks:
Each of the PC networks will be compelled to add mobile reach/distribution either through a partnership or acquisition within the next 12-24 months.
Update: According to Citi's Mark Mahaney, "Greystripe will be run as a wholly-owned subsidiary within ValueClick Media." He says that Greystripe is "expected to add $24-$26MM in revenue and $2-$3MM in EBITDA."
As you've no doubt seen by now WHERE.com was acquired by eBay for an estimated $135 million. WHERE had 2010 revenues of $17 million and projected revenue for 2011 was $40 million.
WHERE has a bunch of assets: great domain, strong mobile app, mobile ad network (120K-130K advertisers), deals functionality and a strong team. The company was reportedly offered a bunch of VC money but chose to take eBay's buyout offer instead.
They were right to do it. While it's possible that WHERE could have built a great deal more revenue and usage, the company also faced massive challenges from larger players such as Google, Facebook, Yelp and Foursquare. It also faced challenges from newer entrants (flavor of the month).
In addition WHERE.com, the PC site, is a huge opportunity that the company has not been able to develop successfully -- so far. Let's see if eBay can do it.
WHERE's ascendancy might be peaking now and a year or two from now the company might not be in the same position of strength. It's possible that WHERE could have grown much bigger if it were to remain independent but I'm not so sure.
Accordingly I think it was smart to take the money and run.
This post is a bit late but I've decided that it's useful anyway to cull the mobile remarks from the Google Q1 earnings call transcript. As you recall Google had a big quarter, with $8.58 billion in revenue, but many investors were disappointed and even spooked by what appeared to be excessive employee-related costs.
I'll extract only the mobile-related comments and figures. The remarks are verbatim from the transcript.
Jeffrey Huber -- SVP, Commerce & Local
A lot more of our searches are coming from mobile devices. This traffic has gone up more than 500% in the last two years. Android is obviously a big driver of this. We're activating over 350,000 Android devices every day. Android market is taking off too, over 3 billion apps have been installed, up 50% in just the last quarter.
Susan Wojcicki -- SVP of Advertising
We're seeing growth this year really taking off. AdMob, the display network that we acquired last year, has over 150 million iOS and Android devices making requests per month. That's up 50% in the past four months, which gives you an idea of how fast Mobile Display advertising is growing.
Many of our advertisers are starting to run mobile-only campaigns as opposed to bundling it with their desktop campaigns. It enables advertisers to move to much more customized mobile experiences. They'll have mobile landing pages and campaigns that can incorporate location. For example, how far away is the advertiser from where you are standing right now? These custom-made stations, again, get us to the perfect ad on Mobile, since users also want to have location, or they want to have phone number. We're also seeing Click-to-Call taking off with more than half a million advertisers using these features. As a result, the mobile-only campaigns are seeing an increase of 11.5% when they run a mobile-only campaign as opposed to a bundled mobile-desktop.
Patrick Pichette -- Google CFO
We already announced at the end of Q3 that this was $1 billion run rate business, and we tripped into it with people kind of adapting what was desktop onto Mobile that was clunky. And it's growing at an amazing, blazingly pace in terms of usage. So what you do know is the combination of -- if you think of the areas of Search, of local, of commerce, of entertainment and just on Mobile, just -- we tripped into $1 billion.
A couple of comments:
Google clearly did not "trip" into its mobile business. It bought Android, it bought AdMob and has been very focused on mobile as a growth opportunity. CFO Pichette is arguing there's a huge amount of growth available yet; this is just the beginning. Yes it's true. However his description is sloppy and generally misrepresents the nature and intensity of Google's mobile focus. Former CEO Eric Schmidt repeatedly used the phrase "mobile first" to describe Google's emphasis on mobile.
The Android activation and apps numbers are very impressive. Less obvious but also extremely impressive are the Google Click to Call figures: "more than half a million advertisers." These are advertisers who are billed when a user clicks a phone number and initiates a call from her smartphone. Because an increasing number of these Click to Call advertisers don't run parallel PC campaigns, they turn into PPCall advertisers.
Ad network InMobi released its latest Mobile Insights Report: Global Edition March 2011. Based on 31.9 billion monthly impressions generated by 220 million consumers, the latest report shows phones running the Android OS overtaking Apple's iPhone. This is consistent with most other data in the market.
The report continues to show Nokia as the global smartphone leader but, like other sources, indicates a decline in its overall share. Strikingly, InMobi says "Nokia lost -3.9 share points in just 90 days, while Samsung (+1.6 share pts), Apple (+1.9 share pts) and HTC (+2.8 share pts) gained share."
Another striking data point: "35% of all mobile ad impressions now occur on smartphones."
In North America, as with the Millennial data just released this morning, the Verizon iPhone has helped Apple but that has not been enought to slow Android's momentum. But for quarter, according to InMobi, Apple's growth outpaced Android's in North America. RIM also grew.
Globally Android, iOS and RIM grew while others declined according to the report. Below, compare the most recent IDC numbers (global estimates for year-end 2011) and those from comScore (US) representing the most recent quarter.
The IDC numbers for Android above are quite aggressive vs. what InMobi show. IDC's numbers are projections based on existing sales and additional assumptions about future consumer purchase behavior. ComScore's data are based on consumer surveys.
ScanLife yesterday released its latest mobile-barcode scanning trends report, showing dramatic growth in consumer usage and traffic. According to the company:
There were also interesting category and demographic data released in the report:
NFC is still years away as a mainstream phenomenon and scanning/2D barcodes has yet to be fully exploited in the market. However the buzz and attention surrounding NFC may cause some doubts about the longevity of 2D barcodes. It's not unlike those who overlook SMS as a marketing or advertising medium in favor of mobile Web and app-based marketing.
NAVTEQ put out a press release yesterday announcing results of "its first hyper-local ad campaign targeting millions of users of the Poynt application." Poynt is a search app. The NAVTEQ ads tested were location and/or contextually relevant to user queries.
Here are the results:
The maiden campaign featured hyper-local ads for national gas station and restaurant brands throughout the United States. All four campaigns performed three to five times better than the industry average* click-through rate (CTR) of .49 with an average CTR of 2.68% across campaigns. Post-click user engagement ranged from 4.49% to as high as 11.25%, depending on advertiser.
The 2.7% CTR and engagement numbers are better than average, but still not as strong as those reported by several others offering local-mobile advertising or location-based ads on mobile devices. Off the top of my head I know that TeleNav, xAD, Placecast and JiWire have local-mobile ad performance data that exceed the reported NAVTEQ metrics.
[Ads] resulted in a click thru rate of 3.8 percent, which is significantly greater than traditional mobile and online display ads. Moreover, the data indicates that the conversion rate of users who drive to the business location after clicking on an ad presented in TeleNav's local search results is nearly 24 percent.
Local-mobile ad network xAD told me that it sees average local search CTRs of 5% to 8%, with some campaigns exhibiting higher response rates. Google also previously reported that after a local-mobile lookup 61% of users called a business and 59% visited a location in person.
The larger point is that directional searches on the go are highly commercial in nature with action likely to be taken by the individuals conducting them.
In an effort to promote its iAds product, Apple has released iAd Gallery. It showcases current iAd campaigns and the agencies that created them. You see the ad creative and get the full functionality of the ad as though you'd encountered it "in the wild."
It's a great idea and will offer a one-stop shop of sorts to see the latest in mobile display ad creative -- on demand.
Previously you had to hunt for these ads and it was almost a matter of serendipity to find one. The iAd Gallery makes it very easy to discover and compare ads side by side. You can browse the campaigns, see those that are "favorited" by users or search for particular ads. It will also provide a way for agencies to compare work.
This is ads as content. It's not that far-fetched to imagine some sort of annual ranking (viewers choice) or other creative award coming from this . . .
Over the weekend there was considerable discussion about comScore's most recent handset and mobile OS market share numbers. What they appear to show is Android clobbering all challengers, including the iPhone whose share remains largely flat. Although the Verizon iPhone was the most popular individual handset in February, the "Android Army" is winning the OS war.
This morning Apple Insider argues that by several measures, iOS is still ahead of Google's operating system, in terms of engagement, app store growth and revenues. Indeed, StatCounter, which presumably is a better reflection of actual consumer behavior than comScore's survey data, shows iOS well ahead of Android usage.
But there's no denying the growth of Android and its seemingly unstoppable momentum. I had a thought the other day about why iPhone may not be growing to the same degree (beyond its more limited availability and more rigid pricing): consumer boredom.
There is only one iPhone (although there are previous models still in circulation). By contrast there are dozens and dozens of Android handsets out there, with different hardware features. This creates constant marketing buzz around the "latest Android flagship" or release of the newest inexpensive Android handsets.
If the iPhone were toothpaste it would be Crest, while Android would represent 20 different flavors. In order to reclaim consumer attention and generate new excitement, Apple may need to do to the iPhone what it did to the iPod several years ago: create different models and colors.
Apple has declined so far to put out a "nano" model, although there have been rumors to that effect. Cupertino needs to address both the lower end of the market (and not just with last-year's model) and create some new excitement around the product -- and not just through software updates.
The latest comScore data, based on consumer surveys (n=30,000), show that the Android surge continues. While the Verizon iPhone was reportedly the most popular individual handset in February, the Android collective -- supported by the top three OEMs -- has now overtaken RIM too. ComScore says that 29% of US mobile subscribers have smartphones -- a number that is now probably low -- vs. Nielsen's 31% estimate.
In part benefiting from Android growth (and vice versa) Saumsung was the most popular handset OEM in the US. While Android gained 7% during the three-month period former smartphone leader RIM was off almost 5%.
Now compare the same charts from a year ago (February, 2010):
Apple's iOS has remained constant, as a percentage of the overall market, according to comScore's figures. Android's success vs. the iPhone is based in part on its wide availability from a range of characters and price points. The iPhone remains available from just two US carriers and is restricted to contract customers.
Investment firm Macquarie captured a bunch of mobile data presented, in part by Google, during and an AMA sponsored webinar on the mobile paid
search market. Most of this has been released or mentioned before but it's a nice collection of stats pertaining to mobile search and the mobile market in general:
The Wall Street Journal is reporting that Google has joined forces with MasterCard and Citigroup (in addition to POS provider VeriFone) on NFC and mobile payments. This follows up on a Bloomberg story last week about Google and VeriFone launching a limited test of NFC-enabled payments in which Google was paying for the installation of new POS hardware at selected stores:
The company will pay for installation of thousands of special cash-register systems from VeriFone Systems Inc. (PAY) at merchant locations, said one of the people, who requested anonymity because Google’s plans haven’t been made public. The registers would accept payments from mobile phones equipped with so-called near-field-communication technology.
According to the WSJ story, the Google effort is about much more than developing mobile wallets. It's equally about consumer analytics and ad targeting:
The Internet giant is aiming to make mobile payments easier in a bid to boost its advertising business. The planned payment system would allow Google to offer retailers more data about their customers and help them target ads and discount offers to mobile-device users near their stores, these people said. Google isn't expected to get a cut of the transaction fees.
The project, which is in its early stages, would allow holders of Citigroup-issued debit and credit cards to pay for purchases by activating a mobile-payment application developed for one current model and many coming models of Android phones. The idea is to turn the phones into a kind of electronic wallet.
These phone users also would be able to get targeted ads or discount offers, which Google hopes to sell to local merchants. They also could manage credit-card accounts and track spending through an application on their smartphone, the people said.
While advertising or couponing based on consumer purchase history is nothing new in the "offline" world, this "closed loop" capability would raise major privacy concerns simply because Google is involved.
The WSJ cites a Federal Reserve report (citing third party data) that estimates an existing infrastructure of 70 million "contactless devices" (cards) and 150,000 readers in the US. The WSJ report also says that Wal-Mart confirmed that it had discussions with Google about NFC payments but didn't say anything beyond that.
There's lots of jockeying for position right now among carriers, credit card issuers and to a lesser degree hardware makers as everyone tries to line up to get a piece of what is expected to be a very substantial mobile payments market.
More stories about mobile payments:
Barcode purveyor and platform Scanbuy has teamed up with Home Depot "to launch an extensive, national communications strategy utilizing mobile barcodes enabled by the ScanLife system."
By that they mean that Home Depot will be incorporating QR codes into marketing materials and in stores. The codes will link to a range of information types, including product ratings and videos. They will also reportedly enable e-commerce transactions over the phone.
According to Scanbuy:
The codes will also be placed in direct mail pieces linking to product information and video demos. A number of unique codes will also be rolled out to store shelves, signage and other traditional marketing material as part of the initial launch of the barcode program. Shoppers in the store will be able to access information like product demo and How-To videos, relevant accessories, buying guides, project guides and an option to purchase online.
Codes outside the store will also enable mobile users to make purchases online through their mobile device, converting any media into a virtual “buy button."
QR codes are a highly versatile marketing tool for product sellers and retailers, as this integration suggests. However the majority of mobile users still don't have them on their handsets. InsightExpress found that 17% of smartphone owners have downloaded a QR reader application (concentrated in the 25-34 year old group, with males, and iPhone and Blackberry users).
Ultimately however barcode scanners will be pre-installed in the majority of smartphones. But over time the question is whether QR codes will be replaced by NFC technology. If not in the long run then at least for the next 3 to 5 years QR codes are safe.
Millennial Media's "Mobile Mix" report for February is out. It reflects device usage on Millennial's ad network, which the company says (per IDC) is the largest "independent" network, after Google and Apple. Among the stats offered by the company:
Moving on, there are a number of interesting observations to be made from the "Top 30 Mobile Devices" chart below.
The Galaxy Tab is the number 7 device on the list. In January Samsung announced that it had sold two million of the devices. However it was later forced to clarify that those were not sales to consumers but sales to distributors. The actual consumer sales figures are significantly less -- perhaps less than half the announced number. Indeed, while I've seen them in stores, I have not seen one in use in the world by an actual person.
Take a look at the "Google Insights for Search" chart below. This is for the last 30 days but it looks very similar going back. There is effectively no demand, as reflected in search volume, for the "Xoom" or the "Galaxy Tab." Accordingly, given all the available evidence, we can safely assume that almost all consumer sales of the Galaxy Tab have stopped or declined to a trickle.
There are likely relatively few Galaxy Tabs actually in the market. This probably means that to be in the seventh position on Millennial's chart those few devices are getting very heavy usage -- especially in comparison to other Android smartphones.
Alternatively it could mean that sales of those devices below the Tab on the chart were fewer than the Tab itself. That would probaby be an incorrect interpretation however. More likely the data reflect that the Tab is being used much more than other Android devices and all the BlackBerry handsets, for mobile Web access.
This brings to mind InsightExpress' comment in its recent consumer insights report that there's a new "a middle category" of mobile users who technically own smartphones but don't engage with them as fully as, for example, iPhone owners. InsightExpress equally observed that this middle group doesn't act like feature phone owners either.
Extrapolating from the position of the Galaxy Tab vs. other Android devices on Millennial's network it would appear that a large percentage of Android users fall into this new middle category.
Yahoo released a mobile white paper called "Mobile Internet – Delivering on the Promise of Mobile Advertising." It's part one of a series. There's a great deal of mobile consumer data in the document. The report covers multi-screen usage (TV + mobile) and tablets in addition to laying out some general mobile consumer behavior numbers and trends.
Citing third party data the report asserts that by the end of 2011 there will be 126 million mobile Internet users. Currently there are more than 90 million in the US according to Nielsen. I would estimate that at the end of 2011 mobile Internet users will number closer to 150 million.
Yahoo cites survey data that shows about 50% of consumers claim they purchase an item after researching it on mobile, while "90% of mobile owners access the web from the retail store floor." Google has slightly different numbers but they're broadly consistent (79% of smartphone owners use their phones while shopping and 74% purchased something as a result).
Yahoo also identifies mobile Internet usage patterns, which appear to be largely parallel during week days and on the weekend. Google and others have argued that PC and mobile usage patterns are complementary.
Here's Google's data about PC and mobile Internet "daypart" usage (via Efficient Frontier). It shows a slightly different pattern than the Yahoo data above.
Mobile Internet use is high in the home, as well as on the go. Yahoo said that 89% of mobile users access the mobile Internet at home. In addition, "86% of mobile Internet users surf the Web while watching TV, often searching for information on advertised products."
Mobile devices thus need to be thought about by marketers and publishers in a more holistic sense. Consumers are using them in the home and in conjunction with other media. This media mutlitaksing was previously done via laptop in front of the TV. I would imagine laptops are quickly being replaced by smartphones and tablets.
Finally Yahoo says that when online and mobile advertising are combined there's a significant lift. This is the same argument that has been made about search and display: "1 + 1 = 3." In addition, in terms of effectiveness Yahoo cites case studies that show significant mobile performance gains over PC:
See related post: Report: 43% of Mobile Internet Usage Happening in Home
An article in Bloomberg this morning says that Google is working with VeriFone and select retailers to test NFC-based mobile payments at stores in New York and San Francisco:
The company will pay for installation of thousands of special cash-register systems from VeriFone Systems Inc. (PAY) at merchant locations, said one of the people, who requested anonymity because Google’s plans haven’t been made public. The registers would accept payments from mobile phones equipped with so-called near-field-communication technology.
The project would put Google in a growing field of companies experimenting with NFC, which lets consumers pay for products and services by tapping a device against a register at checkout, giving them an alternative to cash or physical credit cards. The Google service may combine a consumer’s financial account information, gift-card balances, store loyalty cards and coupon subscriptions on a single NFC chip on a phone.
Because of a lack of universally accepted standards Apple has apparently decided against including NFC technology in the iPhone 5. Apple has 200 million credit card accounts on file and could become a major player in mobile payments if it decides to. Google has far fewer credit cards in Checkout, its payments platform, but the company can leverage its growing Android user base.
Google's would be the first major test of NFC mobile payments in the US. Starbucks has rolled out a mobile payments app across its stores in the US; however it doesn't rely on NFC technology. There are various NFC roll outs now going on in Europe.
US carriers and credit card issuers are also seeking to be major mobile payments providers. So are eBay/PayPal as well as a range of startups including Boku, Zong, Square and Bling Nation.
Beyond payments, NFC would support a range of marketing capabilities, not unlike QR codes today only more versatile. Beyond this Google would be able to capture a range of consumer data, including purchase behavior, that would be incredibly valuable to marketers and that Google itself could use to optimize and advantage its various advertising platforms.
In-stat has projected that mobile payment users around the globe will surpass 375 million by 2015.
Mobile ad network InMobi today released its "Mobile Insights Report: Global Edition January 2011." The report effectively covers all major regions of the globe and there's a trove of data from each continent. I'll focus only on North America and global data.
The company reports that smartphones now represent 36% of global ad requests on the InMobil publisher network, up from 24% -- just three months ago. Most of that growth has been driven by Android. But most ad requests (84%) are coming from mobile Web vs. apps (16%).
Unlike in the US where Android is now the top smartphone platform, Nokia and Apple outstrip Android on a global basis. However Android's growth is much greater than that of the iPhone and Nokia is declining by almost as much as Android is growing.
In North America operating system share appears like this to InMobi:
InMobi explains that Android has gained 21 share points in just three months to become the largest OS in North America.
These numbers are not an absolute reflection of market share but what InMobi sees in terms of handsets and operating systems making ad requests. In terms of individual handsets, the iPhone continues to dominate on InMobi's network globally and in North America.
Global device share:
North American device share:
It's clear from the totality of all the available data that Android's gains are coming through the sheer number of devices in the market. Windows isn't on the radar for InMobi in North America. And RIM appears to be getting overwhelmed by the Android onslaught.
This past weekend Foursquare announced a deal with Amex, which was first reported in the Wall Street Journal. The partnership essentially offers discounts and rewards for checking in at participating local businesses:
Under the arrangement, AmEx customers can register their cards in the Foursquare system to get access to special offers from merchants who are also Foursquare participants. Customers who shop at those merchants with an AmEx card will receive credits and electronic notification that they have redeemed the offer. Merchants who participate in the program would potentially see more sales. . . .
The Foursquare partnership is AmEx's latest offering aimed at people who are roughly a generation younger than the company's traditional customer. AmEx has introduced several new cards targeted at the hip and tech-savvy generation in recent years, with mixed success.
It's going to be initially tested at the SXSW conference coming up next week in Austin, Texas: "Sixty local merchants will honor the 'spend $5, save $5' promotion."
It's great PR and a great high-profile deal for Foursquare, which now has more than 8 million users globally. Amex claims, however, this isn't simply about younger users but about new forms of loyalty and cardmember engagement.
On paper it all makes sense; however there are some potential challenges with the deal. I couldn't find empirical data but my understanding is that on average Amex cardholders are generally older than the bulk of Foursquare users, although there will be some overlap. According to Pew, here's the demographic breakdown of "location based services" users:
This "generic" LBS user profile cuts more broadly than Foursquare specifically. And Google's Ad Planner (as well as Quantcast and Alexa) shows a user base that is somewhat older than Pew's profile. It also shows more female users on Foursquare.
Beyond the "demographic" challenge, is the fact that most local businesses don't use Foursquare to promote themselves. In addition many don't take Amex; you remember the Visa ads. ("They won't take no for an answer, and they won't take American Express.")
In our recent SMB survey about 8% of respondents said they were using Foursquare to promote themselves. This number cannot be generalized to the entire population of SMBs. That would effectively mean about 2 million SMBs actively on Foursquare marketing themselves. The 8% figure is larger than in previous surveys, reflecting Foursquare's growth and increased visibility. However the number of businesses using it to acquire new customers or as a loyalty platform is relatively small.
Accordingly you have to find SMBs or national-local entities that are on Foursquare (and take Amex), together with Foursquare users who have Amex cards to use in those establishments. This slices the potential pie pretty thinly. Yet this is the right direction for Foursquare, which will have enormous difficulty monetizing via SMB self-service. It needs to make big deals with channel partners and do national-local deals with retailers to generate meaningful revenue.
Loopt was an early friend finder and social network for mobile devices that has been forced to reinvent itself and try different things repeatedly because of the entry competitors and better-known brands into its space: e.g., Yelp, Foursquare, Facebook, Google.
The most recent effort to do that is with its new "Reward Alerts," which are limited-time offers that are pushed to users based on location. This is similar to an AT&T-Placecast ShopAlerts initiative that was also announced this week. In that case AT&T handset users opt-in to receive deal alerts and they're pushed to users via SMS/MMS depending on location.
Initial advertisers for the Loopt program include Participating companies include Altec Lansing, FOX Broadcasting, Gilt City, Jawbone, Microsoft, OkCupid, Southwest Airlines, TabbedOut, Twelve South, TiVo and Yurbuds.
In order to participate, users must download the new version of the app, turn on "rewards" then the deals start flowing based on where users are. Loopt has had a deals/coupons product for some time in Loopt Star; however this is a more interesting and potentially successful implementation.
Deals have become immensely popular and the opt-in/push dimension of Placecast's and now Loopt's programs will make them compelling to marketers. For Loopt scale will be key. The company has more than four million users (compare Foursquare's 6+ million). However the Placecast program, because it's text-based, has an addressable audience of 95 million hypothetically (the entire AT&T subscriber base).
WHERE also offers location-based push couponing.
I presented yesterday at a conference called SEMpdx, which is a search conference in Portland. My presentation was on "Mobile Marketing Strategies & Tactics." Reid Spice of iCrossing was my co-presenter. Prior to the session we had an informal discussion about mobile search, CPC pricing and "inadvertent clicks" on mobile ads. The latter was tied to a survey that got fairly wide (and uncritical) attention at the end of last month. The survey was sponsored by mobile lead-generation company Pontiflex and conducted by Harris (in December, 2010).
There were a wide range of findings from the survey, which was conducted either twice or in two parts and had more than 4,000 total responses from US adults. The survey asked a number of questions about apps, advertising and mobile user behavior. However the big headline and finding that got all the attention was "47 percent of mobile app users say they click/tap on mobile ads more often by mistake than they do on purpose."
Other survey findings included the following:
The press release pulled out a piece of segmented data that is even more pronounced: "61 percent of mobile apps users ages 18-34 click/tap on mobile ads by accident more often than on purpose." The "message" conveyed by these findings is that people frequently click ads by mistake and so clicks are a false metric and unreliable as a measure of the efficacy of mobile advertising. Let me say that I absolutely agree with that statement; clicks are a false metric that mobile marketers should walk away from.
However there are a couple of problems here. Self-reported data and "behavioral data" are often inconsistent. In other words, what people say they do and what they actually do may not always line up. So as a fundamental matter we don't know whether people are in fact clicking by mistake more often than not. And we don't have a "control" or baseline metric for the PC to compare it against. It could well be that there's a high incidence of mistaken clicks online.
As an aside the audiences that click display ads online are "a small, unrepresentative portion of the total online population." According to comScore (2009), "4% of Internet users account for 67% of all display ad clicks." Thus clicks are a really bad metric for the efficacy of display ads on the PC. Yet lazy marketers still use CTR as a measure of ad effectiveness.
Most of the coverage of the Pontiflex survey turned into a kind of "telephone" game that ultimately distorted what the publicly released data said. The coverage, and especially the secondary coverage based on the first stories, turned into: "half of all mobile clicks are inadvertent."
In fact we don't have any sense of what percentage of mobile clicks, according to this survey, may be "bad." We know that 47% of these survey respondents think (key word) that more of their clicks than not are unintentional. It could be. But I'm surprised that nobody who covered this was critical or sought to drill into the data for more information.
I don't disagree with the argument that Pontiflex makes about engagement, lead capture and other KPIs being better vs. clicks. And if these Pontiflex data are supported by other findings from others we could see marketers make a push toward CPA (publishers prefer CPM of course). Networks like OfferMobi are also pushing CPA as a better mobile metric too. One might argue that mobile is better suited to CPA than online in many respects because mobile user behavior is more "action-oriented" than PC user behavior.
If CPA does become the standard in mobile display -- we'll probably see a mix of models however -- that, in turn, might influence online advertisers as well to demand or gravitate toward CPA. Search marketing, whether online or in mobile, will largely remain CTR-based however.