User Experience

Splashy New Apps from Yahoo, Opera Make a Play for iPad Usage

Both Opera and Yahoo introduced splashy new apps for the iPad today. Opera introduced a new browser called Coast. On first glance, the browser has some nice features. In particular users can pin icons to the home screen, much like they can on the iPhone and close pages by swiping them away (like the old PalmOS and Android today). Most of the nagivation is based on swiping or the touch of a single button. 

Opera calls Coast a totally new tablet experience: 

The result is a completely designed-for-iPad browser, subtly elegant, made to fit tablet users in every respect. Crafting Coast meant redesigning the complete experience. We focused on how iPad users actually interact with their tablets. Coast is the perfect companion for your iPad, allowing a more relaxing and lean-back browsing experience when you are on the go or just hanging out on the couch.

The iPad is nearly buttonless; why shouldn’t the apps for it be? Elements such as back and forward buttons are gone from Coast. All navigation is done by swiping the way you naturally would on an iPad – just like in a good iPad app. A single button takes you to the home screen, and another shows the sites you have recently visited – that’s about it for buttons in Coast.

When using touch-based navigation, small buttons that work on a regular computer don’t work well on a tablet. It’s not about just enlarging already existing elements; it’s about making the design interesting and uncluttered . . .

Designing for iPad means rethinking everything. Tablets have a lot of screen real estate, and we thought it was about time to put it to good use. Coast does way more than merely migrating the lessons learned from desktop computers to a tablet.

Yahoo has a new tablet-centric video app (though it also works on the iPhone). Called "Yahoo Screen," the app features video from multiple sources, including Comedy Central and SNL, among numerous others. It's not YouTube but an attempt to created a video destination, with lots of clips that can support video pre-roll ads. There's quite a diverse array of content from food and instructional video to sports and movie clips. 

Yahoo has done a nice job with the user experience. Content is the key to success however. The company will continue to need to feed content to the app if it wants to build and sustain an audience. The company had sought to buy Hulu at one point. And now it's moving ahead with its own video product and increasingly original web-only programming. 

While Opera's iPad app is part of a bid to remain relevant in a mobile-centric world -- its mobile browser has largely been sidelined by Android and the iPhone -- Yahoo is hoping to create a way to generate more mobile revenue from lucrative video ads.

Aisle411 $6.3M Round Shows Growing Investor Focus on Indoor Opportunity

A few years ago companies like aisle411 or PointInside were mobile apps in search of an audience and a business model. In the past couple of years, however, everything has changed.

The proliferation of public WiFi, the adoption of smartphones (now 62% in the US) and the recognition among hospitals, malls, airports, stadiums, grocery and retail stores that indoor location could bring better customer experiences (and compelling data) has radically altered the landscape. The principal business model also went from being an ad/coupon-supported one to a technology licensing model, with indoor analytics leading the way.

Today aisle411 announced a $6.3 million Series A round (Cultivation Capital, Google’s Don Dodge, St. Louis Arch Angels, the Billiken Angels, and the Springfield Angel Network). The total the company has raised since being founded in 2008 is roughly $10 million. 

Most major US retailers (e.g., HomeDepot, Macy's, Wal-Mart, Target, Nordstrom, etc.) and malls across the US are now adopting indoor location, to reap the "big data" and offer more personalized, locally relevant and engaing customer experiences. We're only just at the beginning of a huge wave of indoor innovation.

One of the featured sessions at the Place Conference will showcase aisle411. I'll also be "in conversation" with Google's Don Dodge on why he believes indoor location and marketing will be bigger than outdoor maps and GPS. 

The conference will also present other in-venue and retail case studies from PointInside, ByteLight and Meridian (Aruba). If you haven't yet registered for the October 8, 2013 event do so today

26 Reasons to Attend Place 2013: The Indoor Marketing Summit

On October 8 in San Francisco, Opus Research will host Place 2013: The Indoor Marketing Summit. The first event of its kind devoted to the implications of indoor location, it's shaping up to be one of the most interesting events of the year.

The Place Conference will feature Keynotes from Google and Dick's Sporting Goods (+ aisle411), as well as multiple indoor location case studies and demos (existing deployments). Panels will take on consumer privacy, in-store analytics, the implications of indoor location for ROI measurement, online-to-offline ad tracking, in-store marketing to consumers and a range of other topics of interest to all digital marketers, agencies and merchants.

If you haven't already registered, do so today. The early bird rate is gone but if you attend our upcoming webinar, Beyond CTR: Tracking Mobile Ad Impact on Store Visits, you can get access to a new discount code that will save you money off the full rate. 

If you're not already convinced, here are 26 additional reasons to attend the event:

  1. Alexei Agratchev, Co-Founder, RetailNext
  2. Laura Berger, Senior Attorney, Division of Privacy and Identity Protection, Federal Trade Commission
  3. Cormac Conroy, VP, Mobile, Location and Computing, Qualcomm Atheros
  4. Don Dodge, Developer Advocate, Google
  5. Jeremy Geiger, CEO, Retailigence
  6. Jeff Hardison, Vice President, Meridian (Aruba Networks)
  7. Monica Ho, Vice President of Marketing, xAd
  8. Michael Healander, General Manager, GISi Indoors
  9. Waleed Kadous, Android location team lead, Google
  10. Asif Khan, Founder, Location Based Marketing Association
  11. Joseph Leigh, Head of Venue Maps, Nokia
  12. Duncan McCall, Co-Founder & CEO, PlaceIQ
  13. Dan Miller, Senior Analyst, Opus Research
  14. Patrick Moorhead, Vice President - Mobile, Catalina Marketing
  15. Neg Norton, President, Local Search Association
  16. Sarah Peterson, Product Manager, Google Maps
  17. Nathan Pettyjohn, Founder & CEO, aisle411
  18. Jules Polonetsky, Executive Director & Co-chairman, Future of Privacy Forum
  19. Jon Rosen, Executive Vice President, iInside (Wireless Werx)
  20. Todd Sherman, Chief Marketing Officer, Point Inside
  21. David Shim, Founder & CEO, Placed
  22. Ben T. Smith, IV, Chief Executive Officer, Wanderful Media
  23. Will Smith, CEO, Euclid Analytics
  24. Greg Sterling, Senior Analyst & Program Director, Internet2Go
  25. Melissa Tait, VP of Technology, Primacy
  26. Derek Top, Research Director, Opus Research

Data Smackdown: Two Views of M-Commerce (Smartphones vs. Tablets)

E-commerce hosting and services provider MarketLive released a mid-year benchmarketing report yesterday, covering digital marketing and commerce trends through the lens of its many clients. There are many interesting findings. I'll focus however on the mobile aspects of the report, which appear to directly contradict a comScore m-commerce report released today.

The comScore data argue that there are many more e-commerce transactions happening on smartphones vs. tablets. This was something of a surprise to me. Accordingly, comScore puts the total value of US mobile-drive e-commerce at $10.6 billion for 1H 2013; 6% is from smartphones and 3.5% is from tablets.

mobile commerce

These numbers contradict everything I've seen about conversions and commerce on smartphones and tablets. One potential explanation may be that there are nearly 2X the number of smartphones as tablets in the US market.

However the MarketLive data, as mentioned, show something much more consistent with earlier findings I've seen from many sources: tablet e-commerce conversions are higher and tablets are driving a greater percentage of overall revenue than smartphones. 

According to the very busy MarkeLive slide below, smartphones drive more overall traffic but tablets generate considerably more revenue. MarketLive says that roughly 12% of e-commerce revenue for its clients are coming from tablets, whereas only 2.7% is coming from smartphones. However 19% of traffic comes from smartphones vs. 13% of visits from tablets. 

Tablet conversions are 3X conversions on smartphones. 

I cannot reconcile the comScore data with the MarketLive data. The weight of evidence is on the side of MarketLive however. 

Mobile Teens Voice Privacy Concerns, Facebook Offers More Privacy Control

This morning the Pew Internet & American Life project released new data on teen app usage and mobile privacy. The big "takeaway" is that teens care very much about privacy and have taken action against (deleted) mobile apps they feel unnecessarily or gratuitously collect personal information or location data.

Pew says that 78% of teens have a mobile phone (though not all have smartphones) and 23% have tablets. The teen smartphone penetration number is probably 58%, given that's the number of teens who have downloaded mobile apps. 

Just over half (51%) "have avoided apps due to privacy concerns" while 26% have uninstalled an app because it was collecting personal data. And 46% of teen mobile users have turned off location tracking features (on their phone or in an app) out of concern for privacy. 

Teens and location tracking

Teens are more forgiving of apps that seek location data where there's a logical and clear justification for the information (e.g., maps). Girls are more likely to disable location tracking than boys; 59% of girls vs. 37% of boys have done so. 

Separately but still on the theme of privacy, Facebook announced today that it would give more control to Facebook mobile log-in users over what information is shared by third party apps on the Facebook Timeline and News Feed. Here's what the company said today in its announcement:

Although Facebook Login is widely used, we understand people’s concerns about apps posting on their Timeline or to their friends. For the past several months, we’ve been rolling out a new version of Facebook Login on mobile to address these concerns.

With this new update, mobile apps using Facebook Login must now separately ask you for permission to post back to Facebook.

Don’t want to share your music playlist or workout routine with friends? You can choose to skip sharing altogether.

Clearly separating sharing means people can decide whether they only want to use Facebook Login for fast registration without also sharing back to Facebook. If you want to share later, you still can.

This involuntary sharing element was a selling point for publishers and developers but a turn-off to many users. It became a significant barrier for some to using Facebook log-in for third party apps/sites.

By separating sharing from social log-ins Facebook hopes to remove friction for many people who might log in with Facebook but don't today for privacy reasons. I'm in that group. 

Facebook Closing in on $4B Mobile Run Rate

To say that Facebook's mobile ad revenue growth has been impressive is an understatement. It has been, what you might call, meteoric.

In the course of a 12 month period the company has gone from less than 10% of ad revenue from mobile to 41% in Q2 of this year. By the end of this year (or very early next) 50% of Facebook's ad revenue will likely come from mobile. (By comparison, in 2012 more than half of Twitter's ad revenues came from mobile.)

Facebook mobile ad revenue growth

In Q2 '13 Facebook made more than $650 million in mobile ad revenue. If current trends continue expect Facebook to have a $1 billion mobile quarter by 1H 2014 (and possibly Q1 earnings). That would enable the company to claim a $4 billion annual mobile-ad revenue run rate.  

Based on averages and simple math, Facebook made roughly $0.80 per mobile user in Q2 on a global basis -- up from $0.50 in Q1 of this year. However developed markets offer more revenue than emerging markets and so the revenue generated per mobile user will vary considerably from market to market in practice.

Facebook monetization per mobile user

In 2010 we asked "How Long Before Facebook is a Mobile Ad Network?" and predicted that when Facebook turned on mobile ads it would immediately become the largest mobile "network." 

As formidable as Facebook is becoming in mobile Google is still dominant globally. Incredibly, Mountain View is expected to capture more than 50% of mobile revenues on a global basis this year. Facebook claims a much smaller percentage of mobile revenues, but still ranks as the number two player in mobile advertising today. 

Most Smartphone Commerce Happening in the House

As apps and websites become optimized for mobile commerce, and as the "credit card problem" is addressed (see TheFind and Jumio), there will be more buying on smartphones. Most retailers and brands currently assume smartphone transactions happen on the go or in stores (or on other devices). In the home e-commerce is supposed to be the domain of PCs (and increasingly tablets).

The conventional wisdom is that smartphones are more heavily used for shopping out of home and that's been supported by prior survey data. Yet data released yesterday by Nielsen tell a somewhat different and more nuanced story.

Americans are indeed buying things on their smartphones (24%) but they're mostly doing it at home: 72% of people making purchases on their smartphones did so at home and not "on the go," as one would have expected. Only 3% of smartphone owners buying things on their devices did so in stores; 6% did so in their cars. The remainder, 18%, fall into an unidentified "other" bucket. 

It's interesting that smartphones are so widely used for commerce-related activities (store locators) on the go but buying happens at home. Nielsen doesn't offer any real explanation however. It may be that the "immediacy" and availability of the device make it a preferred option for some. 

There's also no data about audience segments. It would be interesting to see if these at-home smartphone transactors are younger, older and whether they have other devices available to them. 

Regardless this is another "wake up call" arguing that marketers and retailers need to quickly optimize e-commerce experiences for smartphones. 

Conflicting Claims: Which Smartphone Is More 'Satisfying'?

Last week the American Consumer Satisfaction Index (ACSI) released findings asserting that the Samsung Galaxy S3 and Galaxy Note II beat the iPhone 5 for customer satisfaction. The Galaxy S4 was not part of the study, which was conducted before the device's release. Somewhat Ironically, Korean consumers said the opposite: that they preferred Apple devices to Samsung's. 

Here are the US ACSI scores by device: 

Smartphone Customer Satisfaction 2013

Survey questions addressed the following areas:

  • Design (including weight and screen size)
  • General handset features
  • Video and audio quality
  • Software and ease of use (including OS and UI) 

What's interesting is that Apple rates higher than Samsung overall in the ACSI company scores -- though Samsung has closed the gap vs. 2012: 

 

Apple more handily beats Samsung in the JD Power ratings, where the iPhone 5 contributed to Apple's overall 2013 smartphone win. In the JD Power satisfaction scoring, Samsung is at the bottom of the group. How can these conflicting scores (within the ACSI and between ACSI and JD Power) be reconciled?

 

The ACSI report offers no real explanation for the Galaxy and Galaxy Note wins. Other than screen specs, Samsung's phones are not the highest quality Android devices on the market. Arguably HTC, LG and perhaps Motorola have stronger offerings from an overall quality perspective. However Samsung outspends them all (combined) on marketing, which has been the chief driver of the Galaxy line's success. 

My suspicion is that consumers are responding to screen size more than any other single variable or factor in rating the Galaxy S3 and Note II above the iPhone. This underscores the larger-screen imperative that Apple now confronts. The company needs to produce an iPhone with a larger screen. And according to multiple rumors, that will happen with the iPhone 6 though not the "5S," which is supposed to retain its current screen of just over 4 inches.

The new Google-Motorola Moto X chose not match the S4 and go to 5 inches after the company did considerable consumer research and arrived at 4.7 inches as the optimal screen span. Accordingly, an ideal screen size for a smartphone is probably right in-between the current iPhone 5 (4 inches) and the Galaxy S4 (5 inches). 

Moto X: Google Turns the Whole Phone into a Personal Assistant

There are a number of interesting things about Googlerola's just-released Moto X. First, it emphasizes design over specs. The latter had always been the hallmark of Motorola's previous Android ("Droid") phones. The new phone also allows for an unprecedented degree of customization:

  • 22 phone back covers (including wood)
  • 7 trim-band colors
  • White or black front/face

In fact, the way the phone is presented on the Motorola site makes it effectively into a fashion accessory. However that's how many people do treat their smartphones today. The customization, which is smart, is apparently made possible because the phone is manufactured in Texas (rather than China). 

But beyond those things, the phone can be activated or invoked without touching it. Users can speak commands to the phone and get responses or create reminders, set alarms and so on. Like Google Glass, Google Now can be initiated with a "wake up" phrase: "OK Google Now." This effectively turns the entire phone into a personal assistant. The TV spot linked below demonstrates this positioning and the functionality in action.

Previously Google Now and voice actions on Android devices had to be initiated by touching the screen: swiping up or touching the microphone icon. That's not required here (I haven't had a chance to use the device). Google/Motorola are using this "always ready" assistant capability to make the device stand out from both the iPhone and other Android devices. Below is one of the new TV commercials for the Moto X, which showcases how Google Now is now being "personified" -- much more like Siri than in the past.

Moto X is priced at $199 with a two-year carrier contract in the US. There will be a Google Play edition but there's no word at this point on unlocked pricing.

Facebook Winning App Game, Where's Google Maps?

There's considerable data (see, e.g., comScore) that indicate Facebook is the most popular mobile app in the US market. That extends beyond unique visitors to engagement and time spent.

Time spent with the Facebook mobile app outstrips every other individual app by a large margin. Earlier this year comScore found that 23% of all time spent with mobile apps was on Facebook. Nielsen has similar figures.

Facebook & Google: Mobile Apps by Share

Source: comScore (Q1 2013) 

Confirming just how popular Facebook's app is relative to other mobile apps are new survey findings from Consumer Intelligence Research Partners. The company asked 500 smartphone users and 1,000 tablet owners in the US about which mobile apps they used most often. 

The question was: "What are the three apps you use most frequently?" There were no suggested responses (no multiple choice answers). The question was completely open-ended. Below are the results: 

Among other interesting things Google Maps doesn't make an appearance in the surve results. Yet Nielsen and comScore data reflect that Google Maps is one of the most popular apps and the most popular location-based app. Mysteriously it doesn't appear here at all -- unless it's considered part of "Google." There's no clear explanation why.

Top US Mobile Apps Ranked by Unique Visitors

Source: comScore (Q1 2013)

Why the Future of Mobile Payments Looks More Like OpenTable than ISIS

Yesterday the Wall Street Journal reported that carrier-backed and NFC-based mobile payments venture ISIS would begin rolling out nationally:

The nearly three-year-old venture, known as Isis, plans to announce Wednesday that it will launch the payment service nationwide later this year after nine months of testing . . . 

Isis said that the pilot tests' findings will be incorporated into the latest version of the system. Among other things, the test showed that active users tapped their phones for payment more than 10 times a month. Two-thirds of active users chose to receive offers and messages from specific brands, according to the test results.

While mobile payments will eventually be widespread -- different global markets are seeing varying rates of development and adoption -- the near-term future of mobile payments in the US looks less like ISIS and much more like OpenTable's new (vertical) payments offering.

The NY Times yesterday reported that the restaurant reservations app will soon incorporate no-frills mobile payments:

The payment process, still in testing, will be straightforward, Matthew Roberts, chief executive of OpenTable, said in an interview. At the end of a meal, the diner would open the OpenTable app and pay the check with the tap of a button. The diner can review the check, adjust the tip and finish the payment.

“There’s no scanning, there’s no bar codes, there’s no geeky stuff,” Mr. Roberts said. He said that OpenTable would not take a cut of each transaction if a diner paid with the app. The restaurant would be charged the typical interchange fee for a credit card transaction. The simple transactions through the app are another way to attract people to use OpenTable, which charges restaurants for reservations made through the service as well as a monthly service charge for using its equipment.

In individual store and specific vertical contexts mobile payments are starting to take hold in the US. That's because consumers see concrete value or convenience in using mobile apps to pay (parking is my favorite example). Arguably the most successful example of mobile payments in the US to date is the Starbucks app.

As a general matter, however, credit cards remain very easy to use and there's no common standard or experience available across merchants. Most US consumers don't see a justification for mobile payments in the abstract. But "in the moment" or in very specific situations consumers can recognize their value. 

The transition to NFC-based payments will probably still take years in the US market -- unless the next iPhone enables them (ISIS wants to expand to iOS). But there's a significant, immediate opportunity for vertical apps like OpenTable to cultivate consumer mobile payments usage. Mobile payments through the OpenTable app also may create more loyalty and frequency vs. competitors such as Yelp or TripAdvisor.

I believe that these very concrete use cases will help train consumers to trust and adopt mobile wallets/payments, which will eventually pave the way for services such as ISIS or Google Wallet. However it will be 3 - 5 years before there's strong, national consumer usage (and merchant adoption) of these "horizontal" payments offerings. 

By contrast people will be using OpenTable payments as soon as OpenTable flips the switch. 

Mobile Credit-Card Scanning Should Be Ubiquitous

Dan Miller and I took a briefing with Jumio this morning. Jumio is an authentication and identity management platform (mischaracterized originally as "augmented reality"). The company has been around since 2010. 

It has two major products that rely on the same technology. Netswipe helps facilitate transactions on mobile apps and Netverify enables accurate remote identity authentication for fraud prevention. I'll focus on the former but the latter is very impressive and worthy of its own discussion later.

Jumio works in the same way that Card.io did. Using an SDK developers embed the Jumio solution within their apps. When the consumer is ready to complete a transaction or check out (book a room, flight or make another kind of purchase), she merely scans the desired credit card and enters the CVV number manually. The transaction takes a fraction of the time that would otherwise be required if she were to key in 16 digits, enter her address information, etc. 

If you've already got your credit card and related information on file (see, e.g., Amazon, iTunes) there's less of a need for this approach. However developers should offer it to new customers as a way to generally eliminate barriers for consumers, and capture credit card details for faster checkout next time.

Jumio competitor Card.io was acquired by PayPal one year ago, leaving Jumio as the lone independent vendor of this type card-scanning technology. Every mobile publisher and developer should be using Jumio or Card.io to improve conversion rates and the customer experience. Beyond mobile transaction-abandonment, frustrating users reflects poorly on the brand according to many studies.

Accordingly, every mobile developer should be using a mobile card-scanning solution as one way to remove friction from mobile transactions. It's not clear why they might not, except for perhaps for ignorance, lethargy and inertia. I could also imagine this approach as an alternative to card swipes in stores, although that's less necessary.  

Jumio has adopted a flat-fee SaaS model. Customers pay a fixed monthly fee for an unlimited number of transactions. 

It's rare instance where consumer and merchant interests are entirely aligned. But here they are: more secure and faster transactions for the merchant and consumer, as well as fewer charge backs and fraud. It's kind of a "no brainer." 

Below is a promotion video that explains the Jumio Netswipe offering: 

Chinese Smartphone Maker TCL Selects Nuance's Swype as Default Keyboard for U.S. Market

As the global market for smartphones matures, it is clear that the default keyboard platform is going to be key for product differentiation. That's why it is so interesting that up-and-coming Chinese OEM, TCL Communications Technology Holdings Ltd, has expanded its licensing agreement with Nuance, making Swype the default keyboard for its line of Android-based smartphones sold in the U.S. In its latest report of device shipments, TCL claims sales volume of smartphones grew 126% in June, when compared to the same month last year, exceeding 1.3 million units. Of the nearly 21 million phones sold globally in the first six months of 2013, over 18 million were sold outside the Chinese domestic market. 4.3 million were smartphones, selling under the he Alcatel OneTouch brand as well as TCL's own Idol X branding.

Like Samsung, TCL is a well-diversified consumer electronics manufacturer with a major presence in the flat-screen TV market. Its management expects the geographic expansion of its smartphone sales to fuel growth and profits in the coming years. If it does so, it will be at the expense of Samsung, HTC and Google's own Motorola brand. Matt Revis, Vice President of Dragon Devices at Nuance, points out that the company had its choice of a number of less expensive alternatives to Swype to support touch-based input, including the "free" default keyboard that ships with the Android operating system.

"This is representative of a situation where you have a company that is positioned to grow globally and looking for an innovation partner to make it a category leader," Revis explained. "They are working with Nuance."

Indeed, it is a signal event for Nuance and Swype, which is already available for free download from Google Play. While Nuance would not provide revenue estimates for the licensing agreement, the impact can be expected to be significant, given TCL's ambitious growth expectations in the coming year. A virtuous circle has been established whereby an aggressive manufacturer recognizes that innovation will be key to growth and has recognized the need to cement a relationship with a firm that has been steadily investing in improving the technologies that support touch-based and multimodal input - both through internal development and acquisition.

Unlike Mobile Payments, Consumer Behavior for Indoor Marketing Well Established

The mobile payments space is a little like the local market: lots of promise, lots of money but very hard to crack. Yesterday a young entrepreneur and his payments startup Clinkle received a $25 million vote of confidence from a group of celebrity investors.

This was reported to be the "largest seed round ever." Whether it is or not $25 million is a lot of money for yet another mobile payments app. While it's true that nobody in mobile payments has "broken through," Clinkle will have a tough slog as it tries to build both merchant adoption and consumer usage.

Once again it's the "cold start" or "chicken and egg" problem. 

However, according to the NY Times, there's no merchant hardware requirement for Clinkle and the go to market strategy involves a Facebook-like focus on college campuses and surrounding businesses. That may be a key decision and help the startup gain some quasi-critical mass in selected markets among students. 

Beyond the hardware issues surrounding NFC adoption, the central issue with mobile payments has been a lack of perceived need among consumers. Mobile payments are being used in selected contexts and commerce situations (e.g., Starbucks) but the public at large hasn't seen the need to replace plastic payment with app-based payment that relies on stored credit cards or bank accounts. 

That brings me to indoor location and marketing. When discussing these topics, and the absence of technology standards, I often use mobile payments as an analogy. Yet there is a critical distinction. The difference between the two segments is that while mobile payments still largely requires a shift in consumer behavior, indoor marketing does not.

Large majorities of consumers are already using their smartphones in stores to look for price information, product reviews and coupons. The idea of brands and retailers communicating with them in stores will be built on this existing behavioral foundation. Accordingly indoor marketing won't require consumers to adopt new technology or approaches to shopping -- unlike mobile payments. 

The "heavy lifting" in indoor marketing is on the merchant side, where WiFi or other sensor infrastructure needs to be in place. Fortunately in most major retail environments the rudimentary infrastructure already exists.

But don't take my word for it. We'll be discussing the competing indoor location technologies and hardware requirements for indoor marketing (as well as their accuracy) at Place: The Indoor Marketing Summit this fall in San Francisco. It will be an event anyone in the mobile or location-based marketing space won't want to miss. 

Is Mobile the Answer to: 'Half of Online Ads Are Never Seen'?

By now you've no doubt read about the comScore data that showed (or argued) just over half (54%) of PC display ads are never seen by users. The finding turns the old Wanamaker "Half the money I spend on advertising is wasted . . ." quote on its head: digital advertising is just as "wasteful" (if not more) than traditional advertising.

Last year, using the same "viewability" methodology, comScore reported that "31% of ads were not in-view, meaning they never had an opportunity to be seen." So the problem is apparently getting worse.

The IAB said that display ads (not counting video) in 2012 represented 21% of the $36.6 billion in US online ad spending. They contributed $7.6 billion at least to the overall pie. If half of that is wasted because ads cannot be seen or are never served it means $3.3 billion is being flushed down the digital toilet, so to speak.

Comparing the impact of PC vs. mobile display advertising across key brand metrics

Source: Dynamic Logic

Enter mobile advertising. I've argued multiple times in the past that mobile is a superior "branding" medium to online for various reasons, not the least of which is improved performance metrics over PC-based digital ads (see graphic above). The chief problem is that most of mobile display features weak ad creative, compromising the potential efficacy of the ads.

To counter this the IAB is releasing a mobile creative "manifesto" of sorts that hopes to instruct brands and agencies about the importance and hallmarks of effective mobile ad creative: A Mobile Manifesto: Creative Leaders on the Art of Successful Mobile Brand Messaging. It features hypothetical examples of best and worst practices.

Here are the broad strokes of the report's recommendations:

  • Clear and persistent branding is important for building brand awareness
  • Short, focused messaging plays well in mobile’s small format
  • A striking color palette can drive ad recall, but legibility is paramount
  • Consumers respond to mobile ads that give them something back

Many of these recommendations are merely "common sense." However even now many mobile display ad campaigns are perfunctory at best with converted or automated ad creative from PC campaigns. Thus marketers and brands are missing out on the true potential of mobile advertising by not making a "sincere" effort to maximize the value of mobile campaigns.

Study: Mobile Users Want to Be Paid for Their Attention

A new study jointly conducted by Millward Brown and mobile loyalty platform SessionM finds that consumers want a clear "value exchange" or "tangible benefits" for their time and attention to mobile ads. The study was fielded earlier this year among two survey groups of 500 US adults and combined with qualitative follow-up interviews.

A primary finding of the study, which echoes Nielsen "consumer trust" data from previous research, is that only 9% of users have a favorable view of mobile ads. Despite their typically superior performance on brand and other KPIs, consumers generally report unfavorable views of mobile advertising in surveys such as the SessionM-Millward Brown study: 

The study argues that mobile ads need to deliver "tangible value" in order to gain consumer engagement. When they do they can outperform other types of digital and mobile advertising. SessionM says that tangible value has three components: "being useful, entertaining and worth the time it takes to engage." 

What this means as a practical matter, according to the study, is offering a literal reward for consumer attention (e.g., coupons, points), although people respond to other types of "incentives" as well as ads that are more "relevant" (e.g., local, personalized). 

The following were the preferred reward types according to the survey:

  1. Gift cards
  2. Coupon or discount of your choice
  3. Coupon or discount selected for you
  4. Tickets for Events
  5. Points towards contest entries
  6. Donations to Charity
  7. Virtual Currency
  8. Access to ad free environment
  9. Access to free videos or songs
  10. Access to free games
  11. Access to exclusive content

Essentially people are saying they want to be paid to look at and engage with mobile ads. It's important to note that the study argues in favor of the types of advertising and marketing that SessionM provides: incentive and reward-based mobile loyalty programs. However other data show that consumers do respond to coupons and discounts at higher rates than other categories of mobile advertising. 

Survey: Why People Shop Locally, Price-Matching Works to Stop Showrooming

In April Harris Interactive conducted an online consumer survey about "showrooming" and related consumer attitudes about online and offline buying. The survey had 2,114 respondents, 824 of whom said they had showroomed: "ever visited a brick and mortar store to examine a product before purchasing it elsewhere online."

Accordingly 39% of the April 2013 survey population had engaged in showrooming at some point. That's actually down from 43% in November 2012 according to Harris.

Best Buy, Wal-Mart and Target are the three major US retailers that are most often "victimized" by showrooming, though the order is different for men and women. This compares to a study (tracking actual store visits) with slightly different results, conducted in February by Placed:

gender showrooming index

According to the Harris study Amazon is by far the most-used online comparison point for in-store smartphone shoppers. A relatively small percentage also or alternatively consult eBay.

Harris also found that price-matching strategies being adopted by retailers are likely to succeed in combatting showrooming. A large majority of those who said they had "showroomed" also said this policy would make them more likely to buy in stores:

Price matching in stores

Source: Harris Interactive (4/13)

Survey respondents simultaneously indicated they like the option to "buy online and pick up in store." In terms of same-day delivery from an e-commerce provider, however, a majority (77%) said they would NOT be willing to pay more for the service. For those willing to pay the majority (56%) said between $1 and $5 was a tolerable range.

The survey also affirmed many of the familiar reasons that people prefer to shop locally vs. online:

  1. Being able to take the item home immediately (86%)
  2. Taking advantage of sales in store (84%)
  3. Not having to deal with the hassles of returning online such as paying for shipping and/or having to pack item (83%)
  4. Ability to touch and feel item (83%)

Being able to "talk with a salesperson" in stores was only valued by 57% of survey respondents. Indeed, a majority (60%) strongly agreed that they "would rather use [a] smartphone to search for information about a product than ask a salesperson for help."

I suspect the latter finding is a result of years of experiences with low-paid and generally poorly trained salespeople in retail stores.

Office Comes to the iPhone -- by Necessity

Microsoft has been in a kind of "double-bind." It has been trying to use Office integration with Windows Phone and Surface tablets to differentiate those products vs iOS and Android. However they haven't been selling particularly well (save in a few isolated countries). Yet the longer Microsoft held Office back from iOS (and Android) the more it faced the prospect of people getting used to alternative software or (Google) docs in the cloud.

Rumored for a very long time, today Office officially comes to the iPhone in app form (though not the iPad). In order to use the app iPhone owners must be subscribers to Office 365. It also requires iOS 6.1 as well and works on the iPhone 4 and above. 

The product appears to require a SkyDrive account in addition but that may be a built-in feature of Office 365. (I'm not a subscriber.) 

The new iPhone app allows users to view and edit Word, Excel and PowerPoint documents. However you can only create Word and Excel documents on the app. Users will also be able to edit docs "offline" and they will sync when the connection is resumed (think airplane flight). Microsoft promises that "formatting and content remain intact" on the iPhone and back to the 365 documents in the cloud.

As mentioned, there's no Office for iPad app but that will ultimately come in all probability. For the time being iPad users can access Office 365 through the browser. So effectively Office is available for the iPad. 

There are now hundreds of millions of iOS devices in the market globally. This year more tablets are expected to ship than laptops and by 2015 more tablets than PCs in general. In the aggregate there will be more "mobile device" users than PC users in the very near future. Thus Microsoft was all but compelled to bring Office to iOS (Android users can access via the browser). 

After Windows, Office is Microsoft's most important and lucrative product -- generating rougly $25 billion in revenue last year. The rise of mobile devices puts enormous pressure on both product lines. However the arrival of Office for iOS means there's less reason to buy a Surface tablet. 

Will iPhone Buyers Wait for iPhone 6's Larger Screen?

The forthcoming iPhone 5S wil reportedly have the same screen size as the current iPhone 5. This will be a significant disappointment to some and potentially cause them to skip the update and wait for the iPhone 6, which is supposed to deliver a larger 4.8 inch screen. That could have a meaningful negative impact on iPhone 5S sales.

A recent survey from Retrevo shows that iPhone owners/buyers want a larger screen than the 5/5S has to offer:

The survey also showed that a significant percentage of would-be iPhone buyers have a "wait-and-see" attitude about buying their next iPhone. This is becoming a problem for Apple as media-fueled rumors of better hardware in the future cause people to delay purchases, unlike Android buyers apparently: 

Despite the wait-and-see approach and yearning for a larger screen iPhone buyers are paradoxically much more loyal, according to the survey, than Android owners. This has been confirmed by other, previous surveys (e.g., ChangeWave) as well.

Google Will Start to Punish Sites not Optimized for Mobile

There's a great deal of debate and discussion about the right approaches to mobile site development in the "SEO community." Should people build dedicated mobile sites; should they use responsive design; what about dynamic serving? The debates revolve around three considerations: complexity, optimal user experience and impact on mobile visibility (chiefly in Google search results).

Yesterday morning Google posted on its "Webmaster Central" blog that desktop sites using faulty or "irrelevant" redirects -- sending people on smartphones to the mobile site homepage, "page not found" pages or otherwise the wrong page in mobile -- would potentially suffer ranking consequences in mobile search results. 

Google expressed concern that "irrelevant redirects" are frustrating and disruptive to users -- and by implication reduce confidence in Google's mobile results. The company didn't address the precise ranking implications of not following its recommendations. However sites that don't correctly send people from PC pages to equivalent mobile pages will be demoted in the future.  

This is part of a larger push by Google to create good mobile user experiences and reinforce mobile search among consumers.

Last year, in a first, Google recommended responsive web design. Most marketers accepted that as gospel accordingly. However Google did not say that responsive was mandatory or recommended in every single case. It's certainly the lowest common denominator solution for publishers (though not always easiest to implement). 

Yet there are many reasons why "responsive" may not yield the best user experience overall (page load time, different mobile user intent, etc.). Regardless, Google is beginning to compel publishers to pay more attention to mobile user experiences (if they're not already) or suffer the ranking consequences.