iab mobile marketing center of excellence the state of mobile
TRANSCRIPT
The State of Mobile:
Consumer Adoption, Revenue
Growth, Industry Challenges,
and Emerging Trends
Anna Bager
IAB Mobile Marketing Center of Excellence
Agenda
• A word about the IAB-US Mobile Center
• Consumers Embrace Mobile
• Mobile Ad Revenues: Growing but
Lagging Behind
• Addressing Industry Challenges
• Questions?
2 IAB | Mobile Marketing Center of Excellence
IAB’s Mobile Marketing Center of
Excellence
• Launched in December 2010
• Think of the Mobile Center as: “a committee
on steroids” or “a mini IAB within the IAB”
• Goal: drive growth of the mobile
advertising marketplace and of our
members’ share of mobile marketing spend
• Full-time staff of 4.5 people
• Separate Mobile Center Board of Directors,
which reports to overall IAB Board
3 IAB | Mobile Marketing Center of Excellence
IAB Mobile Marketing Center
of Excellence Leadership
Consumers Embrace Mobile
A Mobile Revolution is Underway
5
Mobile Traffic is 13% of the Internet, Globally
6
Source: “Internet Trends @ Stanford - Bases,” Presentation
by Mary Meeker, KPCB, 3 December 2012.
7
More Than Half of US Cellphone
Subscribers
Own Smartphones
Source: Nielsenwire, “Smartphones Account for Half of all Mobile Phones”, March 29, 2012
Link: http://blog.nielsen.com/nielsenwire/online_mobile/smartphones-account-for-half-of-all-mobile-phones-dominate-
new-phone-purchases-in-the-us
Sweden Adopting Smartphones
Very Rapidly
49%
68%
0%
10%
20%
30%
40%
50%
60%
70%
80%
January-11 January-12
8
Source: Telenor Sweden press release, Dec. 19, 2012, Cited by
eMarketer,
Swedish Smartphone Penetration (ages 18-65, phones for personal use)
November 2011 November 2012
Mobile value propositions vary by
device type:
9
Source: Mobile’s Role in a Consumer’s Media Day: Smartphones and Tablets Enable Seamless Digital Lives – ABI
Research & IAB Mobile Center
Link: http://www.iab.net/guidelines/508676/mobile_guidance/mobileusage
Smartphones are mission-
critical devices for “life,” with
nearly 70% of smartphone
users saying they “won’t leave
home without it.”
Tablets are a media consumption
hub, with nearly 70% of tablet
users reporting that their tablet is
an “entertainment device.”
Mobile is the Anywhere, Anytime
Medium
10 Source: InMobi and On Device Research, “Five Ways Mobile Devices Have Changed the Way Americans Consume
Media,” Mobile Media Consumption Research, Q2 2012 Sample size : 1,055.
‘Mobile’ does not mean ‘remote’
11
Source: Mobile’s Role in a Consumer’s Media Day: Smartphones and Tablets Enable Seamless Digital Lives – ABI
Research & IAB Mobile Center
Link: http://www.iab.net/guidelines/508676/mobile_guidance/mobileusage
Nearly all smartphone and tablet users (91% and 97%, respectively) report
using their device at home – the most widely used location for mobile activity
Smartphone and Tablet Use In Front of the TV
12 Source: ABI Research Survey, June 2012
Question: When, specifically, have you used your smartphone/tablet at home to access mobile data services in the last 3 months?
70%
81%
0% 20% 40% 60% 80% 100%
Smartphone
Tablet
Percentage of owners of each device who have used their device
while watching TV in the past 3 months
Significant Mobile Phone Video Usage Happens At Home
13
Q6 Diary: Where were you?
Country: US Date: November 2012
Base: Total interactions (987
In which room ?
Bedroom
43%
Front
room/ Lounge 35%
Kitchen 4%
Bathroom 4%
Dining room 2%
Garden/patio etc 2%
At
Home:
63%
Source: Mobile Phone Video Diaries: Understanding Mobile Video Usage, IAB Mobile
Center Study Prepared by OnDevice Research, Released November 2012
Apps v. Browser: Steady Relationship v. Casual Encounter
14
51%
50%
0% 10% 20% 30% 40% 50% 60%
Used Apps
Used Mobile Web
Consumers use mobile web and apps in equal numbers…
81,5%
18,5%
0% 20% 40% 60% 80% 100%
Time using apps
Time using mobile web
Sources: Usage data: comScore, reported in TechCrunch, “comScore: In U.S. Mobile Market, Samsung, Android Top The
Charts; Apps Overtake Web Browsing,” July 2, 2012. Data 3 month avg ending May 2012. Time spent data: comScore
reported in betanews, “The mobile web is dead,” May, 2012. Data March 2012.
But apps vastly dominate the time spent equation.
Percentage of consumers using mobile capability
Percentage of total time spent online on smartphones
Mobile Internet Makes Everyday Activities Easier
15
Source: IAB and Viggle Mealtime Goes Mobile Survey, January 2013,
http://www.iab.net/mobilemeals
Mobile Use in Ordering Takeout and Delivery
Mobile Ad Revenue:
Growing But Could Be Faster
17
Where Consumers Go
Ad Revenue Follows
$0 $500 $1 000 $1 500 $2 000 $2 500
Middle East & Africa
Latin America
Europe
North America
Asia-Pacific
Display
Search
Messaging
18
Mobile Ad Revenue, Year-End 2011, in US$ Millions
Source: IAB-US Mobile Center, IAB Europe, IHS ScreenDigest, “Global Mobile
Advertising Market Valued at $5.3 Billion (€3.8 Billion) in 2011,” June 6, 2012
US$1.9B
US$1.7B
US$1.4B
US$0.19B
US$0.17B
US Mobile Ad Spending
Shows Strong Growth
19 Source: eMarketer Press Release Sept. 5, 2012, “eMarketer: Twitter Tops Facebook in US Mobile Ad Revenue”.
Link: http://www.emarketer.com/newsroom/index.php/emarketer-twitter-tops-facebook-mobile-advertising-revenue/
US Mobile Ad Revenue Not Keeping Pace With Other Media
20
Source: “The Future of Mobile Ads,” Presentation by Henry Blodget, Business Insider.
Data from: IAB, McCann-Erickson, BIA-Kelsey, BII Estimates. Note: Adjusted for
inflation
$0,36
$1,01
$2,16 $2,16
$3,70
$0,06 $0,27
$0,91
$1,92
$4,62
$0,08 $0,16 $0,39
$0,81
$1,17
$0,0
$0,5
$1,0
$1,5
$2,0
$2,5
$3,0
$3,5
$4,0
$4,5
$5,0
Year 1 Year 2 Year 3 Year 4 Year 5
Broadcast TV PC Internet Mobile
US
Dolla
rs,
Bill
ions PC Internet
Broadcast TV
Mobile
Mobile Revenue Much Less Than PC Revenue
21
Source: “Internet Trends,” Presentation by Mary Meeker, KPCB, at D10 Conference, 5/30/2012.
Note: Zynga mobile revenue estimated by KPCB. All data as of 5/12. Sources: Pandora, Tencent,
Zynga.
$6,62
$25,00
$58,95
$3,87 $5,00
$17,61
$0,00
$10,00
$20,00
$30,00
$40,00
$50,00
$60,00
$70,00
Pandora Zynga Tencent
PC Revenue Mobile Revenue
Online radio, ad
supported.
Social games,
ads plus
micropayments
Avera
ge R
evenue P
er
User
(US
$)
Chinese portal
site; revenue
per paying user
Industry Challenges
Barriers to Entry and Growth
22
Marketers See Significant Mobile
Advertising Challenges
23 Source: Marketer Perceptions of Mobile Advertising, IAB Study conducted by Ovum, July 2011,
n=300
To Realize Mobile’s Potential
We Need To:
• Make mobile content easier to create.
• Make mobile advertising more
engaging, fun, and interesting.
• Make mobile advertising easier to buy.
• Demonstrate mobile’s value in a cross-
screen, cross-media world.
24
Scaling Content is Difficult
BlackBerry Curve
9370 360x480
Motorola Droid RAZR
960x540
Samsung Galaxy Note
1280x800
Amazon Kindle Fire
1024x600
Apple iPad (new)
2048x1536
Apple iPhone 4S
960x640
Note: Devices chosen as examples to highlight range of screen sizes
(measured in pixels) in US market currently. Images not to scale. Sources:
manufacturer websites
Apple iPhone 5
1136x640
Key Decision Points Include:
• Content type: Apps versus Mobile Web
versus both.
• Operating system: Android? iOS?
Windows 8? BlackBerry?
• Device Type: Tablets? Smartphones?
Hybrids? Not-smart-phones?
• It’s hard to do all of these well
simultaneously.
Creating Mobile Content
26 IAB | Mobile Marketing Center of Excellence
New Technologies Will Help
• Responsive Design: A set of
technologies that enable web
servers to change content elements
and layout in response to the
screen size of the requesting
device.
• HTML5: The next-generation
standard for creating web content.
Enables very rich, “app-like”
experiences without needing to
design native apps for each and
every device/operating system.
Creating Mobile Content
27 IAB | Mobile Marketing Center of Excellence
28
Static Banners v. New, Rich
Units
Improving Mobile Ads
IAB Mobile Rising Stars 300x50 Static Banner
29
Ubisoft Branded App Sells Dance Game
Improving Mobile Ads: Case Study
IAB | Mobile Marketing Center of Excellence
30
Nokia Lumia Launch on Mobile
IAB | Mobile Marketing Center of Excellence
Improving Mobile Ads: Case Study
Advertisers Needs
• Same in mobile as in any other medium.
• To reach a desired audience (people who
will be interested in their product/service)
• To reach them with a relevant message the
audience will like or respond to
• To reach everyone in that target audience
easily and efficiently
• To be able to measure the outcomes of that
advertising campaign. Did it work?
Make Buying Easier
31 IAB | Mobile Marketing Center of Excellence
Several Ways to Buy • Direct: agency buys directly
from a media company/publisher
ad sales force.
• Network: agency buys via an ad
network, which aggregates ad
inventory from a large number of
publishers
• Exchange/Real Time Bidding:
agency buys ad inventory as it
becomes available by bidding
using automated systems
Make Buying Easier
32 IAB | Mobile Marketing Center of Excellence
33
Mobile’s Complex Landscape Make Buying Easier
Source: http://www.lumapartners.com/lumascapes/mobile-lumascape/
We need a simpler story to tell about
the path connecting marketers and
consumers!
Multiple Devices Contribute to Purchases
Mobile & Cross-Media
34 Source: Google, The New Multi‐screen World: Understanding Cross-‐pla1orm
Consumer Behavior,” Released August 2012.
Ads Tap Into Co-Viewing
• TV ad campaigns use Shazam and other
technologies to encourage users to interact
via mobile.
Mobile & Cross-Media
35 IAB | Mobile Marketing Center of Excellence
Research and Education Needed
• We intuitively believe
that someone who
sees an ad campaign
on their TV, PC, and
smartphone will be
more likely to recall
that ad.
• IAB has launched a
major research effort
to prove and quantify
ad synergies.
Mobile & Cross-Media
36 IAB | Mobile Marketing Center of Excellence
Concluding Thoughts
• Mobile data is transforming the way
people live.
• Where the people are, advertisers will
go…eventually.
• But we have work to do to make mobile
more media and ad-friendly.
• The pace of innovation in mobile media
shows no signs of slowing: lots of new
exciting developments to come!
IAB Mobile Center
37 IAB | Mobile Marketing Center of Excellence