The Shopping Channel Retail goes mobile Issue Three | September 2010 News | Views | analysis Currying Favour How bRaNds aRe usiNg mobile to eNgage coNsumeRs iN iNdia JuST The TiCkeT How tRaNspoRt, eVeNts aNd eNteRtaiNmeNt VeNues aRe goiNg mobile M&S and Mobile tHe RetaileR talks about its mobile jouRNey STrengTh in nuMberS Smaato founders explain how global reach gives the company its edge InSIde: eVeRytHiNg you eVeR waNted to kNow about mobile apps effecTIve MobIle MarkeTIng awardS eNteR tHe today! EFFECTIVE MOBILE RKET RD s
Transcript
The Shopping ChannelRetail goes mobile
Issue Three | September 2010
News | Views | analysis
Currying FavourHow bRaNds aRe usiNg mobile to eNgage coNsumeRs iN iNdia
JuST The TiCkeTHow tRaNspoRt, eVeNts aNd eNteRtaiNmeNt VeNues aRe goiNg mobile
M&S and MobiletHe RetaileR talks about its mobile jouRNey
STrengTh in nuMberSSmaato founders explain how global reach gives the company its edge
InSIde: eVeRytHiNg you eVeR waNted to kNow about mobile apps
www.migcan.com twitter.com/migcan Integrated mobile & digital communications
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20 local knowledgeSmaato CEO Rugnar Kruse explain the company’s approach to maximising publishers’ mobile web and apps inventory
Thought leadership
5 are we there yet?Sienne Veit, social & mobile commerce development manager at M&S Direct, explains how the retailer “got” mobile, and how it is using the channel
19 dev zoneFuture Platforms managing director Tom Hume offers advice for successful app development, based on a decade spent developing mobile applications for global brands
42 off-deck Helen Keegan looks at the opportunity for mobile apps and services in the retail industry
Technology 6 The m-retailing revolution
We look at how mobile is permeating almost every aspect of retailing, from location-based advertising and targeted coupons to transactional mobile websites and price comparison services
28 Just the ticketHow businesses from a variety of sectors, including travel, entertainment and leisure, are embracing mobile ticketing
Editor: David Murphy - [email protected] +44 (0) 7976 927062 Commercial Director: John Owen - [email protected] +44 (0) 7769 674824Contributors: George Cole, Martin Conway, Helen Keegan, Peggy Anne SalzDesign: Nathan Taverner, The Page Design Consultancy Ltd - [email protected]: DS Print - [email protected] thanks this issue to: Jo Murphy, Rowan Chambers, Nathan Taverner, Becks McRobbFor a paid subscription please contact: [email protected] One Year Subscription Rates – UK: £25.00 Europe: £35.00 ROW: £40.00
Mobile Marketing is published by Dot Media Ltd., 15 Loraine Gardens, Ashtead, Surrey KT21 1PD. www.mobilemarketingmagazine.com
business models
10 Shop around the clockDavid Murphy finds out how e-commerce specialist Portaltech is applying its development expertise to the mobile channel
13 all about appsPeggy Anne Salz goes under the bonnet of the mobile applications revolution to find out what’s driving it, and who stands to gain most from it
32 brave? yes. Foolish? noHow Europe’s only global mobile advertising marketplace is taking on the competition – and winning
The real world
22 Focus on indiaWe take a look at how brands are using the mobile channel to engage with consumers in India, tapping in to the locals’ love of cricket and Bollywood content
best practice
35 Judgement dayTime is running out to enter the Effective Mobile Marketing Awards. All the details you need are here
36 ad:tech goes mobileWe turn the spotlight on this year’s ad:tech London show, where there’s a big mobile presence, both on the exhibition floor, and in the conference programme
38 applications showcaseWe present a selection of mobile apps that have caught our eye
Full to bursting!
Welcome to the latest print edition of Mobile Marketing, which, as ever, is bursting at the seams with news, views and analysis of the global mobile marketing business.
Sienne Veit from M&S Direct kicks us off with a look at how the retailer has embraced the mobile channel and is using it to drive sales and build customer loyalty, deploying everything from 2D barcodes to mobile sites.
App developer Tom Hume shares some key learnings from a decade developing mobile apps, and Helen Keegan considers the potential and prospects for mobile apps and services in the retail sector.
There’s something of a retail feel to the issue, in fact, as we take an in-depth look at how retailers from all sectors are going mobile, and meet Portaltech, an e-commerce specialist which is applying its skills to the mobile channel.
In our big interview, we talk to Ragnar Kruse, CEO of mobile ad optimisation firm Smaato, to find out more about the company’s unique approach to mobile advertising. And our regional focus is on India, where we learn how cheap handsets and low-cost data plans are fuelling interest in mobile marketing from brands and consumers alike.
Peggy Anne Salz has written a detailed report on the mobile apps business for us, and we also learn how mobile ticketing is finding a home in a number of different sectors, from transport to entertainment. Finally, we throw the spotlight on some of our favourite mobile applications.
We’ve got plenty of exciting news of our own in the weeks to come, and we’ll be delighted to share that with you via the website as soon as we’re able to talk about it. In the meantime, check back into the site regularly to stay informed, and if you haven’t yet submitted your entry or entries for our Awards programme, the Effective Mobile Marketing Awards, you only have until 24 September to do so.
As ever, enjoy the issue, and if you find yourself at ad:tech, please drop by our stand (No.368) and say Hello.
Sienne veit, social and mobile commerce development manager at m&s direct, explores the retailer’s journey into mobile
aRe we There yeT?
It’s an ordinary Thursday at M&S Direct: the company nutritionist has asked me
a question about mobile for an innovation funding proposal. I have a meeting with our Customer Service team to talk about ad-ditional ways we can use SMS (above those we use for order-related issues). On my personal phone I have received an SMS re-minder about our Oxfam clothes exchange. At the central meeting tables, dotted with printouts of creative, the online market-ing team are reviewing mobile banners for a planned campaign later in the year. The mobile team supports these teams by consulting with them, but all this activity is now business as usual.
This to me is what success in mobile looks like – where mobile as a tool is widely embraced and understood within our organisation, and where colleagues across a range of business areas are actively thinking about how we can use mobile to help customers and improve our business. It is no longer the preserve of a few techie people. This is the story of our journey over the past two and half years...
In January 2008, when we started our mobile journey, few of my colleagues would have contemplated accessing the mobile
web themselves, and even if they did, our company phones couldn’t do so, and few people had personal phones that made going onto the web any fun. They were wary about mobile, and wondered if M&S customers would use it.
It took a lot of persuading and a lot of PowerPoint, backed by a small development budget, to get the go ahead to embark on our first two mobile propositions (and some still thought we were crazy). The first was a ‘Back to School’ campaign, where we used mobile to cut through the advertising clut-ter to reach the busy mum on her key tool (her mobile). It comprised a mobile website
to mobile campaign sites, and this August, we sent our first MMS messages.
Our food team approached us in the middle of 2008 with a challenge – how do we get more information on to food packaging when we are trying our best to reduce pack-aging in line with our Plan A targets? In August 2008, we used 2D barcodes to enable customers to access some of the great sto-ries behind our products through the mo-bile web. We used mobile barcodes on over 1.2m bottles of M&S ‘Freshly Squeezed’ juices, distributed at 589 stores nationwide over eight weeks. We didn’t assume that all customers would have barcode readers on their mobiles, so customers could text FRESH to 65006 to download a reader. The campaign was a success – and we now know that customers are prepared to use their mobiles in store to access digital product content and offers.
With each activity, we learned about what customers would do (and what they couldn’t or wouldn’t). We’ve learned more about a range of mobile technologies, but most importantly, we’ve learned who in the organisation needs to be involved in the creation of a successful proposition (and what tools and information they need to do that with confidence). When we set out in early 2008, we did so with the conviction that mobile was going to grow: we acquired a dedicated shortcode, a .mobi address, and the notion that data, measurement and demonstrable ROI were at the heart of growing mobile within the business.
Mobile will keep on changing; our customers will continue lead us as they do more and more on their mobiles. New plat-forms will emerge, and some will become dominant – for M&S, learning and innova-tion in mobile will be a constant, and that is something we embrace, so that we can continue to offer our customers simple, use-ful and engaging shopping experiences.
“It took a lot of persuad-Ing to get the go ahead to embark on our fIrst two mobIle proposItIons”that replicated our 16-page back to school mini-brochure, with click-to-call ordering with a call to action accessed by texting SCHOOL to 65006.
Today, we have the UK high street’s first transactional mobile website, where our customers can search, browse and buy all our online products, from womenswear to wine, using one account that is the same for the web, mobile and in-store ordering.
The second mobile initiative we launched back in 2008 was our SMS broadcast ser-vice, where our loyalty customers could opt in to receive text alerts for updates, news, exclusive offers and discounts, by texting MANDS to 65006.
Today we have over 700,000 opted in customers, 80 per cent of whom have been happy to provide us with information, so that we can provide them with useful, targeted information. We now embed links
earlier this year, M&S became the first uk retailer to launch a transactional mobile website
mobile offers massive potential for retailers, as those who have already embraced it are finding out, but there are still challenges to overcome, says george cole
downloading promotional digital coupons onto their mobile phones every week. The customers can redeem the coupons at a McDonald’s store simply by waving their mobile handset in front of a reader, which uses a short-range wire-less technology called Near Field Communication (NFC).
The service, known as Ka-zasu Coupon, is a joint venture between McDonald’s and NTT DoCoMo, and in less than two years, some 4.5m McDonald’s customers have signed up for it. Kazasu Coupon represents the cutting edge of mobile in the retail channel, and many more retailers look set to ex-ploit the opportunities offered by mobile retailing.
Mobile phones are the ideal device for finding retailers, browsing, price-checking and purchasing, at home or on the move. For retailers, mobile handsets can be used for adver-tising, promotion, marketing and m-commerce. A Retrevo Pulse Report examined US con-sumers’ attitudes to shopping on a mobile and found that 50 per cent of those under the age of 35 had used their mobile for some form of shopping.
Oded Ran, Microsoft’s head of consumer marketing, Win-dows Phone, says shopping by mobile offers: “The benefit of mobility, allowing consumers to browse and purchase items whilst on the go. The shopping process itself is also a much quicker and less stressful one, as queue and travel times be-come defunct.” There are ben-efits for retailers too, adds Ran, allowing them to fully interact with customers by tapping into their needs. “This provides an extension of a bespoke service that provides consumers with a more personal experience,” he tells Mobile Marketing.
“we’ve found that Consumers’ shoppIng behavIour on a mobIle phone Is not dIssImIlar to shoppIng on the web, and some people are purChasIng £10 Items, whIle others are buyIng Items CostIng more than £1,000” sienne veit, marks & spencer
But the signs are that many retailers are being slow to grasp the potential of mo-bile as a sales or marketing tool. In the US, Multichannel Merchant found that almost four out of five multichannel retailers were not using any m-commerce features, such as mobile advertising, apps or digital coupons.
optimised websitesSponge, a pure-play mobile marketing agency, surveyed 136 retailers and found that two thirds had not optimised their websites for mobile access. Of those that had, almost half offered transactional services, while the rest used their mo-bile website for brochureware. “More disturbing was that one third had built or were plan-ning to build an app, mainly for brand building. I find that scary, because many hadn’t even ensured that their sites displayed well on a mobile,” Sponge chairman Alex Meisl tells Mobile Marketing.
According to Meisl, more than 85 per cent of all mobile devices will be internet-en-abled by 2011, but smartphone penetration is still only around 25 per cent. “The problem with apps is that you can create a second-class mobile society. Apps are great for certain people – but what about the rest?” asks Meisl, adding that: “Shoppers are more savvy. The relationship between retailer and consumer must be one-to-one and not one-to-many, so you need to send them relevant information. Between 36-40 per cent of retailers had not used mobile in any way, and that worries me, because they will get left behind.”
Digital vouchers or mobile coupons are downloaded onto a mobile phone and redeemed in-store. A variety of tech-nologies can be used for mobile
coupons, including SMS, barcodes and NFC. Howard Wilcox, senior analyst at Juniper Research, and author of the report Mobile Coupons & NFC Smart Posters: Strate-gies, Applications & Forecasts 2009-2014, says that more than 300m consumers globally will be using mobile coupons by 2014. “Mobile coupons make life easier for people. There’s less chance of losing a mobile coupon than a paper version. There are green issues too – it saves paper,” says Wilcox, “For merchants, they mean a reduc-tion in fraud. There’s a reduc-tion in the ability to forward on coupons, so they are used by the person they are intended for. For retailers, it vastly
increases the redemption rates. Mobile operators like them because it encourages people to use their phones more.”
i-movo offers a digital voucher service. The firm’s clients include Coca-Cola and Costa Coffee. “The challenge with offering digital vouch-ers is integrating them with retailers – we had to use the existing payments infrastruc-ture used by retailers. Our voucher system looks like a small credit card transaction to the retailer’s system,” says i-movo CEO, David Tymm. The consumer goes to a PayPoint terminal with his or her mobile phone, where a voucher number is entered or a barcode is scanned. This data is sent
Cellfire delivers mobile coupons for many of america’ leading retailers, including Safeway, kroger and giant eagle
september 2010www.mobilemarketingmagazine.com www.mobilemarketingmagazine.com
to i-movo, where its authentic-ity is checked and validated. The result is sent back to the retailer, who is told how much they will be paid for redeeming the digital voucher.
Tymm says mobile vouch-ers offer a number of benefits: “They are immediate, engaging and target your audience. You are unlikely to have your lap-top with you when you go to a store, but it’s more than likely that you’ll have your mobile.” He also points out that sending out millions of coupons is a lot of currency, so you need insur-ance to reduce the risk or to manage the risk with technol-ogy. By eliminating fraud, it’s possible to make offers more generous, run promotions for much shorter time periods and gain a higher redemption rate. “The marketing services in-dustry has been waiting a long time for a system that offers consumers instant gratifica-tion, which has no high fixed costs, and which can be used cost-effectively for smaller campaigns,” adds Tymm.
promotional codeIn the US, Cellfire offers a free service which enables consum-ers to download a Cellfire app or browse coupons on the mo-bile web, then register to use coupons. Non-grocery offers can be presented as a promo-tional code, keyed in by the ca-shier, or a 2D barcode, scanned at the register. Grocery offers are linked to the grocer’s shopper card, and consumers register their card and then browse and select coupons on their PC or phone. “Our system offers value and convenience. You don’t have to cut out coupons and then remember to take them out with you when you shop,” says Dan Kihanya, Cellfire’s vice president of consumer marketing.
Cellfire has formed relation-ships with retailers, brands and manufacturers, including some of the top US grocers, such as Kroger, Safeway and Giant Eagle, and is available in 4,500 stores across 39 US states. Its business model leverages the existing paper voucher system: manufacturers and retailers pay when users select their coupons. Around 300bn paper coupons are issued in the US each year, with a redemption rate of between 0.5 and 1 per cent. Cellfire has had around 15m coupons downloaded in the past two years, with a 5 - 25 per cent redemption rate. Little wonder that Kihanya concludes that: “Retailers across the globe are only scratching the surface of how to use mobile.” Yet there are many compelling reasons for doing so, he says: “Retailers want to find a way of engaging with consumers in an interac-tive way and the mobile phone is a great platform, because you can reach people almost anywhere: at home, on their way to the store and in store.
Studies show that 30 - 40 per cent of consumers using elec-tronic coupons have not used coupons in those stores before, and they tend to spend more, adds Kihanya: “For retailers, electronic coupons mean lower administrative costs – there’s no paper to collect and no need to train staff on how to handle them. For manufacturers, they provide better ROI and are more targetable. It’s also a way of reaching a younger audience, who don’t read newspapers.” Cellfire recently launched QMobile Coupons, an electronic coupon syndica-tion platform developed for iPhone and Android handsets. It enables electronic grocery coupons to be combined with mobile applications.
But despite their advantages, Juniper’s Wilcox notes that: “There are various challenges to using mobile coupons. NFC technology is promising, but there is a lack of handsets and readers outside of Japan [where there are more than 60m NFC-enabled handsets]. The reflection and glare from mobile phone screens can be a problem for some in-store scan-ners, and then there’s the pri-vacy issue – getting people to use coupons in the first place,” he adds. “Coupons have to be delivered on an opt-in basis, and that’s a limiting factor.”
location-based ads Geocast places location-based adverts on mobile websites. “The mobile becomes an extension of the retailer’s storefront. In the same way they would advertise a special offer in a store window or on a billboard. It’s also a good way of acquiring new customers,” says Geocast CEO, Brad Lieb-mann. The consumer only sees the retailer’s ad when they are near the retailer, and can click on a map to get directions. “We only broadcast adverts to people that are near your busi-
“between 36-40 per Cent of retaIlers had not used mobIle In any way, and that worrIes me, beCause they wIll get left behInd”alex meisl, sponge
Sccope enables consumers to check the price of something in one store with a number of retailers, before they pay too much for something
ness. It’s a very targeted form of advertising and marketing,” adds Liebmann.
Geocast recently rolled out a mobile microsite service that can be used with any smart-phone browser. The company is offering the microsite for free to UK retailers with one loca-tion. “We are flipping the web-site inside out. The location is at the front and not the back. It detects where you are and then gives the relevant location. If you want more information, it’s there,” says Liebmann. He adds that retailers cannot afford to ignore mobile: “At present, around 5 - 10 per cent of retailers’ web traffic is com-ing from mobile phones, but the mobile web is growing at such a fast pace, that it could soon be 50 per cent.”
Scanbuy’s ScanLife app is available to consumers across Europe, and works with many devices, including iPhone, Android and Blackberry hand-sets. ScanLife uses barcode-scanning technology and returns results from the web
in seconds, with best prices, availability and reviews for the scanned product. The app now includes data feeds from Pric-eRunner, as well as Amazon and Google Products.
price comparisonSccope offers a consumer price-comparison service for online and mobile users; the company works with than 100 well-known UK retailers. Sccope has also worked with operators, including T-Mobile and Vodafone, creating price-comparison widgets for some of their selected phone platforms, which are now pre-loaded onto leading handsets. Sccope’s iPhone app includes a barcode scanning facility – you just scan the product’s barcode to get a price-comparison list-ing on the phone’s screen. A Sccope app for BlackBerry is also available.
Future plans for Sccope include a value-for-money comparison service, rather than just prices: “Retailers often include added-value of-ferings, such as a free extended warranty and bundled acces-sories, and we’ll be including this information, along with the price, so users can compare the true market value of the proposition against others,” Douglas Orr, Sccope’s CEO and founder explains.
This autumn will also see the launch of a contextual vouchering service, based on location and context, as well as a mobile shopping service: “Purchasing with your mobile will be easier than pulling out your wallet. Just type in your password and make your pur-chase – the goods are delivered to your home. It will be the fun, stress-free way to do your Christmas shopping this year,” says Orr. Using the mobile phone for shopping is a no-
brainer, he says: “The mobile phone is a 24/7 experience – it’s always with you. Sccope allows its users to turn the phone into a 24/7 shopping platform.”
Mobile websiteMarks & Spencer (M&S) was the first UK high street retailer to launch a mobile website. The website offers more than 24,000 products, includes images and product reviews, and is fully transactional - this is no cut-down version of the company’s core website. “Our motivation for launching the mobile web-site was that we tracked our main core website and looked at what mobile devices were hitting it. The results showed that our customers were al-ready shopping with their mo-biles,” says Sienne Veit, M&S’s social and mobile commerce development manager. Some 800,000 people accessed the M&S main website by phone in a 12-month reporting period.
The website is designed for all types of internet-enabled handsets, not just smart-phones, and you can use the same M&S account across multiple channels. So the items in the shopping basket on your PC are the same as on
your phone. M&S has placed a lot of emphasis on simplify-ing product search and the store locator is highly vis-ible (M&S has more than 650 outlets). “Some 700,000 people have signed up to receive SMS messages from us and we can now direct them to our mobile website. People can click from a mobile banner to our site. Now, we can fully integrate our marketing strategy, Veit tells Mobile Marketing.”
The mobile website has al-ready outstripped every single prediction. “We’ve found that shopping behaviour on a mobile phone is not dissimilar to web shopping, and some people are purchasing £10 items, while others are buying items costing more than £1,000,” adds Veit. M&S plans to further develop the mobile website, perhaps with location-based or personal-ly-targeted advertising.
The M&S demographic might not look particularly mobile-friendly at first glance. The fact that it has embraced the mobile channel so enthusi-astically, and done so with such success, should perhaps serve as a cautionary note to those still thinking about it. Mobile retailing is here: get with it.
i-movo’s mobile coupons are redeemed using the paypoint terminals found in many uk convenience stores. Clients include Coca-Cola and Costa Coffee
The M&S mobile site is fully transactional and can be accessed from any mobile with a browser
T hese are still early days for mobile retailing (m-
retailing), but talk to half a dozen people with an informed opinion on the subject and you’re likely to come away with a firm conviction that it is going to be huge. Not just in the purest sense of order-ing and paying for goods and services via your handset, but also in the wider sense of brands and retailers using the mobile channel to advance the sales process cross-channel, either by giving shoppers ac-cess to relevant information to help them make a purchasing decision in-store, or by target-ing them with offers on their mobile in order to drive them in to retail outlets.
The analyst Juniper Re-search predicts that more than 300m consumers globally will be using m-coupons by 2014, as consumers become increas-ingly familiar with the idea
of shopping, and researching purchases, via their mobile phone, and Morgan Stanley predicts that by the same year, more people will be brows-ing via their mobiles, than through their PCs.
Transactional websitese-commerce consulting and development firm Portaltech is well placed to take advantage of this trend. For the last 10 years, it has been develop-ing and integrating transac-tional e-commerce websites for brands and retailers including L.K.Bennett, Long Tall Sally, the Post Office, Premier Far-nell, Vodafone, The Body Shop and Thompson & Morgan.
The company’s QuickLive platform enables it to build and deploy a fully transac-tional website in just 12 weeks, and supports every element of the business, from ordering and stock management to call
portaltech has a strong heritage in the e-commerce arena, and is making a big play in the mobile space, says david Murphy
sHop aRouNd The CloCk
centres, catalogues, mobile and marketing activities.
The company first started looking seriously at the mobile channel around a year and a half ago when the firm realised that a significant proportion of client’s web traf-fic was coming from smart-phones, and increasing month by month. And this, despite none of the company‘s clients having mobile-optimised websites or apps at the time. “We are great believers in harnessing the right technol-ogy to enhance multi-channel sales communication, and so we spend a lot of time looking at the customer journey, spot-ting consumer trends that may provide retail opportunities, whether that’s offline, or on,” explains Rachel Wilkinson, Portaltech’s head of brand & retail. “We knew mobile was a growing channel, but I admit even we were surprised by the amount of smartphone brows-ing going on. But research we have conducted since shows that there is a real appetite for shopping on mobile phones – for example, in the last week alone, 25 per cent of customers polled said they had browsed on a mobile device, which was significantly more than those who had browsed by catalogue. It is clear to us that mobile will be a significant retail
portaltech’s Quicklive mCommerce platform offers detailed product displays and Store Finder functionality to help users find their nearest outlet
“mobIle Is the next natural step for our retaIl ClIents, who already trust us wIth theIr transaCtIonal websItes”
channel, not just a trend – but it needs to be harnessed cor-rectly so that mobile enriches their customers’ purchasing journeys appropriately.”
The research, conducted among 1,200 consumers, found that 13 per cent of smartphone owners are using their mobile for between 10 and 40 per cent of their shopping, 20 per cent of smartphone users have bought something on their phone, and 20 per cent also expect to buy more things via their mobile in the future. And it is clear that consumers are using their mobiles to aid purchasing decisions when out about too, as 59 per cent of respondents, said they had used their smartphones when shopping on the high street.
Portaltech’s first move into the mobile space was to develop an iPhone app called StripeyLines, which it released
in December 2009. This is a very neat solution that enables a shopper to compare the price of an item in different stores, read reviews, and share the information with friends, all by simply scanning the product’s barcode with the app on their iPhone. They can also use the app to buy the item from an online retailer.
promotional vouchersFor the retailer, StripeyLines can store all product data, deliver promotional vouchers direct to a customer’s mobile when they are in store, and integrate digital advertising messaging pop-ups and price promotions. A bespoke retailer plug-in can also be integrated within the application to enable direct shopping from within StripeyLines.
“The original reason for creating StripeyLines was really to investigate the mobile market in more detail,” says Wilkinson. “But it just makes it very easy for busy shoppers to research and buy things more easily, and I think that’s why it has proved so popular with consumers of all ages.”
The company’s next move was to mobilise its QuickLive ecommerce platform, with the launch of QuickLive mCom-merce, which enables a retailer to deploy a fully transactional mobile site or application with-in just four weeks. The first
retailer to go live with the solu-tion, was L.K. Bennett, whose iPhone app went live earlier this month (see panel). The app is unique in another way too; it’s the first to integrate Pay-Pal’s Mobile Express Checkout, a mobile-optimised version of the payment firm’s Express Checkout service. “There are 26m PayPal account holders in the UK alone, so when we were developing our mobile offering, we were very keen to integrate with them,” says Wilkinson.
QuickLive mCommerce uses a simple, easy-to-use design template that makes it easy for users to get an overview of the products they are interested in, before drilling down to see more detailed images and spec-ifications for individual items. Wilkinson says there will be more QuickLive mCommerce-based apps from other retailers in the near future.
“We think we have a good story to tell,” she says. “We have 10 years of e-commerce and retail experience behind us and truly understand the importance of the multichan-nel super shopper. For us, mobile is not a bolt-on, or an afterthought, but the next natu-ral step for our retail clients, who already trust us with their transactional websites.
“We have spent a lot of time and money developing what we think is a truly intuitive m-commerce platform for end consumers and one that retail-ers can embrace and make their own. It’s such a unique opportunity for retailers and brands to engage in a fun and direct way with their end cus-tomers, to be accessible 24/7 and that’s what people want. Mobile has brought conve-nience and accessibility to the retail table. Finally!
“The next steps I would like to see are for a forward-thinking retailer to truly join up the channels, to make it personal & targeted and to utlilise technologies such as StripeyLines’ barcodes to deliver special deals, product information, cross selling and a kind of ‘personal shopping assistant’ via the mobile – the technology is there, but no one has really harnessed it all yet. We are very excited about the opportunities and can’t wait to see what happens next.”
portaltech’s iphone app for luxury british fashion house l.k.bennett is built on the company’s Quicklive mcommerce platform. it showcases the retailer’s current collection of shoes, womenswear and accessories, using an intuitive and easy-to-use navigation structure. Quick category grid browsing and large zoomable product images enable customers to search and flick through products quickly and easily. Favourite products can be shared with friends and family via e-mail orFacebook, or can be saved into a wishlist for later purchasing. a pdF ‘look book’ let’s customers see outfits from the company’s latest campaign, and the app also incorporates paypal’s mobile express checkout for easy payment via paypal.
the mobile app also links to google maps to provide customers with a map and directions to the nearest l.k. bennett store. customers can also search by location or postcode and find stores’ opening hours, or call stores direct from the app.
l.k.bennett director of e-commerce kate smyth is delighted with the application. she says: “we could see that a significant number of our customers were already browsing and purchasing via their mobile browsers and in particular via their iphones. we hope that this app will enable l.k. bennett to provide additional 24/7 browsing and a shopping channel for customers at a time that is convenient to their lifestyle.”
portaltech developed the Stripeylines app to gain a better understanding of the mobile channel
using Stripeylines, consumers can put together a Wishlist of things they would like to buy
app downloads worldwide totalled approximately 7bn, and the outlook for 2010 is even better. But we shouldn’t break out the champagne just yet. The business models are unclear, the market is fragmented and real success is linked inextricably to local and regional market conditions. Apps still face real challenges.
Mobile application stores – destinations offering software and services across a range of handsets, portals, storefronts and mobile websites – have been around since the late 1990s. However, the ‘app frenzy’ and excitement that has accompanied the rise of the Apple App Store, the proprietary software store launched by Apple in July 2008, and which has resulted in the sales of billions of apps for the iPhone, iPod touch and - more recently - iPad devices, marks an entirely new phase in the distribution and monetization of all things digital.
In contrast to the model that allowed mobile operators to pocket up to 90 per cent of revenues for content and software sold over their networks, Apple introduced a 70/30 (developer/Apple) revenue share model that jump-started interest and innovation in the mobile apps business. Today the 70/30 split is the defacto standard for the entire apps industry.
Apple’s other smart move was to encourage a complete business ecosystem around the development and monetization of apps, streamlining the process and allowing developers to move software from conception to market in weeks, not months. In an industry where mobile author and pundit Tomi Ahonen writes that the app store provider with the most developers and the most robust ecosystem is destined for market domination, this is no small matter. It’s also the main reason why Android is closing the gap on Apple.
However, it is the seamless user experience that continues to allow Apple an important first-mover advantage. By way of background, Apple used its existing iTunes model as a springboard for the easy launch and management of the App Store. The store, designed to take advantage of the capabilities of the iPhone operating system, user interface and device design, made it easy for Apple to offer an optimal experience to its entire user base. In addition, Apple only enables downloads through the App Store - applications it bills via the user’s iTunes account, not the user’s mobile phone bill. By effectively imposing this alternative way of paying for apps (via credit card only), Apple has effectively cut operators out of the value chain altogether.
So far, Apple has been able to capture a large percentage of the mobile apps market from within its own walled garden. But Sizing Up The Global Apps
all about appSPeggy anne Salz investigates the seemingly unstoppable rise of mobile apps and app stores
“dIfferent busIness models wIll be requIred to make regIonal app eCosystems vIable” Chetan sharma, Chetan sharma Consulting
september 2010www.mobilemarketingmagazine.com www.mobilemarketingmagazine.com
Market, a report commissioned by independent app store GetJar and researched and written by Chetan Sharma Consulting, points out that Apple’s success is limited.
(don’t) follow the leaderThe Apple App Store model, though popular in regions such as N. America, does not dictate the direction this new market is headed. In fact, the dynamics of the app market are shaping up to be quite different in different regions. As Sharma observes in his report: “Different business models will be required to make regional [app] ecosystems viable.”
Against this backdrop, app store providers and developers alike will need to develop much more than a me-too app storefront, modelled on the Apple blueprint. To succeed, they will need to develop and embrace diverse business models and monetization approaches to reach and delight their target audience.
It’s a tough task, but well worth the effort, according to Sharma’s report. It estimates that overall mobile app downloads will increase from over 7bn in 2009 to almost 50bn by 2012, growing at a compound annual growth rate (CAGR) of 92 per cent. The revenue from mobile apps, a
category that includes both paid downloads and revenue from advertising and virtual goods, is expected to increase from $4.1bn (£2.7bn) in 2009, to $17.5bn by 2012, at a CAGR of 44 per cent.
Though on-deck (operator-managed) mobile app sales exceeded those from off-deck in 2009, this is forecast to change. By 2012, off-deck will account for the majority share of mobile apps revenue. Ad-supported apps are also expected to account for a larger percentage of total downloads. By 2012, ad-funded will generate 28 per cent of app revenues.
horses for coursesThe September 2010 App Store Report, a market overview published by the Wireless Industry Partnership (WIP), counts an astonishing 94 app stores, up from 85 the previous month. Everything from India’s SMS GupShup, an app store offering SMS-based apps, to AppCentral, an app store from US-based Ondeego, providing applications and value-added services to the enterprise. Read between the lines, and it is clear that a ‘long tail’ of app store offers and approaches is emerging.
The report sheds some light on the divisions and differentiation between the models, which it breaks down into on-deck (or on-device), an approach utilized by mobile operators, platform providers and handset makers; and off-deck, the approach used by everyone else.
The report also examines the causes of the meteoric growth in the number and variety of app stores. It suggests that: “a key factor in the proliferation of app stores is the rise of off-deck aggregators and platform providers.” This has made
it possible for any company anywhere in the value chain to offer a mobile app store.
These providers range from Qualcomm, whose Plaza solution provides mobile operators with a fully-hosted and managed app store solution, to GetJar, which provide white-label app solutions to a variety of customers, including US mobile operator Sprint, youth-focused mobile operator Virgin Mobile India, and mobile handset maker Sony Ericsson.
GetJar is more than a successful provider of hybrid solutions that help mobile operators, handset makers and other providers stock and run an app store on their own. The company also boasts the world’s second largest app store, with over 1bn downloads to date, second only to Apple’s App Store.
According to Patrick Mork, GetJar CMO, the company’s key point of difference is its open market approach, which allows it to deliver applications for both feature phones and smartphones across all major platforms. The company provides more than 75,000 mobile applications to consumers in more than 200 countries around the world.
Against this backdrop, Mork is bullish about the outlook for a few app stores to dominate the marketplace. “There is no way that this many app stores will survive in the long term,” he says. “While the value of the global app economy is set to be astoundingly high by 2012, we
think only a few app stores will share this revenue.”
Why? Mork says it all has to do with the virtual nature of commerce in an app store. “In a virtual economy such as the app economy, retail is different and you don’t need that many players.” Another deciding factor is the size of the budgets developers can dedicate to selling their apps in the first place. “Developers have finite resources,” says Mork. “They are resource-starved and will therefore only work with a few app stores, because they won’t have the time or energy to work with many of them.”
payment mechanisms Developers not only have to make some tough choices about the platforms they support and the app stores where they want to feature their offer. They also have to choose their payment methods and mechanisms wisely.
This is the conclusion of a recent report from Netsize. Drawing on a survey of over 1,000 mobile professionals, it suggest that a strategy built on choice – offering consumers a wide choice of apps and an even greater array of payment schemes that goes beyond Apple’s singular focus on credit cards – will potentially pay off big time for developers and app store providers alike. The three most popular operator-based billing methods are currently Direct Operator Billing, Premium SMS Messaging and WAP Billing.
Qualcomm’s plaza solution provides mobile operators with a fully-hosted and managed app store solution
getJar goes direct to consumers, and also provides white-label solutions to a variety of customers, including mobile operators and handset makers
The need for payment choice is supported by the survey findings. Respondents indicated that app stores must harness a variety of billing mechanisms. Chief among these is operator billing, chosen by 85 per cent of respondents as a key enabler for mass-market app store appeal. “To succeed, providers will need to develop and embrace diverse business models and monetization approaches,” observes Alexander Vlasblom, Netsize marketing and communications director. “The options range from paid apps and apps bundled with subscription offers, to ad-funded schemes and loyalty programs that offer apps to boost brand awareness.”
Netsize is also bullish about the increasing importance of billing solutions that give developers and app store providers greater control over the complete merchandising experience, allowing them to sell content, virtual goods, add-ons and updates right from within the app. Sensing a business opportunity, Netsize now offers in-app billing, a mechanism that allows developers to collect one-time payments, or to start an ongoing subscription scheme from within their app, using a variety of payment methods.
A growing number of mobile commerce enablers have introduced in-app billing, a trend that opens up a range of exciting commercial opportunities for application developers and app store providers everywhere.
The analyst firm Juniper Research estimates the mobile app market will be worth $25bn in five years, growth that will largely be driven by the proliferation of business models and the adoption of
in-app billing. For now, most revenue is made at time of purchase, but Juniper says it expects this to change as in-app billing increases in use to enable important incremental revenues for developers.
in-app opportunity Mobile payments firm Bango has also seen a significant increase in the number of its customers using in-app billing to maximize their return on their apps. “We are working with many developers that are going to be releasing in-app billing over the coming months,” notes Andy Bovingdon, VP product marketing at Bango.
In his view, a sale stands or falls on the number of clicks it takes a user to buy the app. In-app billing allows developers to successfully offer their apps on a freemium model, offering the app with a certain amount of free use and then requesting full payment at a time the developer feels is right. “There’s no need for the user to go back to the app store to make a purchase and pay. It’s just a matter of clicking the Approve Buy button and the upgrade occurs,” he says.
Making that transaction a no-brainer by allowing the user to complete the transaction in just-one click is critical, says Bovingdon. To drive this point home, Bango has published Make Money From Your Mobile Apps, a whitepaper that tracks some key web browsing numbers and trends, and outlines how developers can make the most out of their mobile apps by streamlining the purchase process and using analytics to know who their audience is.
Specifically, the whitepaper documents the registration and payment procedures in the Nokia Ovi and Android market
“there Is no way that thIs many app stores wIll survIve In the long term”patrick mork, getJar
app stores. The verdict: in both app stores, the audience is restricted and the payment process is tedious.
“The payment experience has a huge impact on conversion,” Bovingdon adds. A straightforward payment experience that users can perform in one click can generate “a yield of around 91 per cent.” That’s the gold standard Bango says it is achieving with several European operators, and with Sprint in the US.
Bovingdon advises developers to take charge of their marketing, beginning with tracking to understand who their users are, what phones they have and how people interact with their apps, and ending with an understanding that they can and should focus their efforts on more than one app store.
“The app store is a closed world where the developer doesn’t have control of payment or influence on search,” he says.”App stores will put you in the ‘What’s New’ section for a few days, but after that, it’s up to the developer.” The fact that popular app stores are managed by handset makers or platform providers with their own agenda turns up the pressure on developers to treat this as a business and do all they can to achieve the maximum conversion rates. “Getting a few more per cent of yield can make the difference between a business model that’s profitable or loss-making, or it can make a difference between a business that can actually grow or is going to shrink,” Bovingdon tells Mobile Marketing.
A realistic and proactive approach to marketing has enabled Touchnote - the UK-based mobile app
september 2010www.mobilemarketingmagazine.com www.mobilemarketingmagazine.com
startup behind the app of the same name, that allows users to snap and create personalized photos with their cameraphone and send it to someone as a physical postcard – generate impressive revenues and build a decent business.
To date, the Touchnote app is available on most major platforms (Symbian, Android, iPhone and Windows Phone 7) and is under development for the BlackBerry. By the end of the year, Touchnote CEO and founder Raam Thakrar
the advance of the app store model changes all the rules. a new report, authored by analyst firm Visionmobile, sponsored by telefonica developer communities and based on research across more than 400 developers, provides a range of insights into the opportunities and challenges ahead.
after years of frustration with the complexity of the platforms and the difficulty of establishing partnerships with handset makers and mobile network operators, developers are breaking out in new directions that put their interests first.
a result of this is a significant rise in the level of mindshare and market share that android enjoys over other platforms, including symbian, java me and windows phone. in fact, the survey shows that nearly 60 per cent of all mobile developers recently developed on android, with ios (apple iphone) coming in second. both outrank symbian and java me, which held the pole position in 2008.
why the overall shift from platform incumbents such as symbian to platform newcomers such as apple and android? Visionmobile points out that developers are now commercially savvy, so market penetration and monetization models are deciding factors in selecting a platform.
another reason could be platform complexity. Visionmobile’s benchmarks show that a symbian developer needs to write almost three times more code than an android developer, and twice as much code as an iphone developer.
combine that hassle with the significant differences in time-to-market for apps (24 days for apple, 33 for android and over 54 days for symbian) and it’s easy to see why many mobile app developers are voting with their feet, and moving away from symbian to more developer-friendly platforms.
time-to-payment also plays in favour of the app store model and the platform owners that run them. according to the report, developers that choose to sell their apps via an app store generally get paid within a month of the application. on average it takes 55 days to get paid via an operator channel, 69 days to get paid when the app is preloaded by the operator, and an incredible 168 days (five and a half months) to get paid when the developer preloads the app via a handset maker.
interestingly, two-thirds of developers prefer the pay-per-download monetization model. despite the excitement about advertising-supported models, ad-funded apps came in a very distant second.
so what is the role of the mobile operator in this emerging app economy? only 20 per cent of respondents said they are using the mobile operators as a channel to market. in fact, the vast majority of developers feel operators are bit-pipes that should clear the way for other ecosystem players. as one opinionated developer quoted in the report put it: “operators should get out of the way of developers.”
this explains why the vast majority of developers now use native app stores (bundled with the handset) or offer their apps via a direct download from their own websites. according to the survey, apple and android app stores are the crowd-pleasers, with only 5 per cent of java and just over 10 per cent of windows phone developers using app stores as a primary distribution channel. java me developers also use independent app store getjar as a channel, followed by Nokia’s ovi store.
while developers themselves may feel differently, the report concludes that the developer community could benefit from working more closely with mobile operators. it argues that a closer relationship with mobile operators would provide developers with important marketing support, allowing them to rise above the noise and get their apps in front of the right customer segments. interestingly - and despite their low opinion of mobile operators - half of respondents have similar views. in fact, they would even be willing to pay mobile operators for premium app store placement.
according to Visionmobile research director andreas constantinou, the emergence of an app marketplace is just the beginning of a power shift that will impact the entire mobile space. “the mobile industry is in the midst of a major transformation, and developers are driving it,” he says. “the old world of the b2b handset market is seeing its value erode with the entry of the $100 smartphone. at the same time, the new world of mobile applications is seeing new areas of value mushroom as developers explore the emerging developer-to-consumer (d2c) market.”
doing it Their Way
estimates that the app will cover “95 per cent plus of the smartphone market.” In addition, a non-exclusive deal with Sony Ericsson, which sees the app distributed on the company’s handsets on a global basis, has also been a significant boost to business. While Thakrar doesn’t disclose downloads, he reports orders from 176 countries.
ad-funded appsOf course, not all apps generate such excitement and sales. An example is
freelance mobile developer Simon Maddox’s 0870 iPhone app, which is ad-funded. Last year, Maddox made headlines after it was reported that the approval process took an astonishing 429 days. The app is designed to save users money by finding alternative local numbers for the 0870 and 0845 numbers used by many companies for their customer services, and charged at a rate of as much as 35p a minute. It was downloaded over 91,000 times in the first two weeks after launch.
apple’s original iphone started the mobile apps revolution. Subsequent models like the iphone3gs have helped it maintain its dominant position
Finding the right match between business models and payment methods is core to competitive advantage. but it’s not just about clinching the first-time sale. a recent raft of reports suggests that app store providers and developers also have to think up new commercial models to encourage consumers to make the all-important return purchase.
a study from pinch media, which analyzed over 30m downloads from apple’s app store, reports that just 30 per cent of people who buy an iphone app actually use it the day after it was purchased. and the numbers plunge from there: after 20 days, less than 5 per cent of those who downloaded an app are actively using it. but it’s not all bad news. apps that provide new content on a daily basis - such as news and social apps – generally achieve the return visits and downloads they need to make their business work.
tego interactive, a design and development company, advises many early-stage startups and mobile brands on their options when it comes to launching a longer-term app strategy. based on these insights, tego interactive has identified three basic areas companies must address if they want to be more than a one-hit wonder.
1) keep it fresh - and keep it coming there’s little value in yesterday’s news and entertainment, which is why companies that offer apps in these categories have it relatively easy when it comes to making that return sale. However, companies that offer games and novelty content, for example, have to think and try harder. as brian avery, tego interactive co-founder observes: “games developers need to come up with creative ways to keep their games exciting. a few examples are new levels, new characters and social features. that usually keeps users coming back for more, knowing there’s continued value of using the app.” specifically, developers should harness in-app analytics and monitor discussions about their apps in social networks and feedback forums.
2) think cross-platform - and plan ahead. the end-game for app developers should be about critical mass. “you’re going to limit success if you only target users on one platform,” avery says. since few developers have the resources to release an app for all the platforms, he advises developers to make their decision based on platform market penetration for their users and monetization models. “develop for the platforms that give you the most control over the way you bring apps to market and how you charge for them.”
3) Focus on content discovery - and stand out. users cannot buy what they cannot find. but the poor performance of search engines in indexing and exposing the abundance of mobile apps puts the burden of being found squarely on the shoulders of application developers. “don’t let it become purely a popularity contest because the big guys will always out-market the independent app developers,” says avery. “submit your app to plenty of app review sites and make sure you get the word out across a variety of social networks to generate buzz.”
Top tips for successBut Maddox later revealed
on his blog that his hugely successful app, which saved UK consumers roughly a quarter of a million pounds, had generated just $680.82 in advertising revenue.
Such examples have taught Touchnote’s Thakrar and his company to think beyond the app and the user and focus on the customer that counts: the company that can distribute the app. “For a developer, the customer is the audience, but it’s also the people who can distribute the app on your behalf,” he says. Understanding this new dynamic will decide between the market leaders and the laggards. “There are a lot of talented people working hard to create apps that don’t make more than a few thousand dollars a year.”
However, best-selling writer Ahonen connects the dots in recent download stats to conclude that the vast majority of developers will not make a living selling their apps. In his view “iPhone economics is bad news.” In fact, most app developers can count on breaking even
sometime in 2021, he says.This is particularly ironic,
since app stores, struggling to stand out from their rivals, have begun to build their competitive advantage based on the assortment of cool apps they have on offer. This shift puts even more power in the hands of developers, and should convince more of them to go cross-platform, Thakrar says. “You have to get yourself in front of customers and have a retail mindset.”
Looking forward, Thakrar says he can imagine huge changes in the app economy, as more developers pursue such a strategy, and ultimately realize their real value. App stores managed by handset makers and platform providers are focused more on growing their sphere of influence than creating a business ecosystem that helps developers flourish. But the day is coming when developers might be able to charge for stocking the shelves of app stores with their cool stuff. After all, as in retail, a store is only as good as the variety of goods it has on offer.
developers face a daunting choice of platforms to develop for; Samsung’s bada is one of the more recent ones adding to the confusion
And with 20% of smartphone owners saying they intend to purchase more on their mobiles in the next 12 months, this is a channel waiting to be embraced!
With a ten year heritage in providing award winning eCommerce websites, Portaltech are spearheading the development of mobile apps with our 'QuickLive
Mobile' commerce application. We put your customer first, to ensure that we create the best mobile app for your business and multi channel strategy.
By the end of 2010, 1 in 5 people will own a Smart Phone.
one of the big advantages of mobile over every other medium is its avail-
ability; we constantly keep our phones with us. This availability opens up a number of opportunities denied to other media. We think that one of these op-portunities is the potential for richer live interactivity between events and their audience, increasingly brought together using the mobile. But there is a specific set of issues which must be considered and mitigated to do this right.
We’ve learned this the hard way: by spending a few years launching products which enable audiences to participate in a shared experience through their mobile phones. A few years ago, we worked with the Discovery Channel in the US to launch the world’s first mobile Ghost Detector, for a 9-hour broadcast of Most Haunted Live - and persuaded 4,500 viewers to download a Java app for their mobile, use it to hunt down ghosts near their homes and report on paranormal readings to the show. These were col-lated, mapped and reported in real-time. 90 per cent of downloaders chose to give us their name and zip code, which we interpret as a clear sign that audiences are interested in closer engagement.
More recently, we’ve launched Roulette Cricket for the iPhone. This is a sports gambling app that takes data from live cricket matches, as they happen, and lets you bet on where the next boundary will be - all in real time. Apple has featured the app in its ‘What’s Hot’ list for some
The Second ScreenMobile makes a great ‘second screen’, but being a second screen implies that you won’t have your users’ complete attention - and you should plan for this in your app and its promotion. Most Haunted was a long enough broadcast that we expected our audi-ence to step away from the screen, giving them a chance to hunt around the house for spectres. In contrast, cricket is practically an ambient sport, which fans may consume whilst at work or pottering around at home. This drove us towards providing feeds of commentary inside the app itself (to allow a distracted player to catch up on the ac-tion), and an ‘Action Replay’ feature, so that if they’d lost or won money on a boundary they hadn’t seen, they could see what they’d missed. Key learning: Make sure you plan for distractions.
live is not liveIf you’re tying into events which are being broadcast, be aware that your audience may see the event at different times - even though it’s all ‘live’, you’ll find that broadcast TV, satellite, radio and the various cable networks take slightly different amounts of time to get the event into living rooms across the country... and when you’re getting an audi-ence engaging, betting, or commenting, seconds can make a difference. Key learning: Latency matters, and it’s not constant.
immediate FeedbackWe’ve run voting at a few events - using text messaging and various kinds of app to get the audience participating. If you give your audience immediate feedback, and show them the impact of any action they’re taking, you’ll generate repeat usage. A case in point: when we ran a Virtual Dolphin Derby at the Brighton Digital Awards, we let players vote on the ‘Best in Show’, but every vote received caused the corresponding dolphin to leap into the air and do a somersault. This simple piece of animation let everyone see that their vote had been counted, and encouraged repeat-voting through-out the night. Key learning: Give the most immediate feedback you can.
The bigger pictureFinally, we think that showing your audience their position in the grand scheme of things is important, and can drive repeat behaviour. In the case of the Ghost Detector, the opportunity to be part of an unusual broadcast was enough to drive that 90 per cent opt-in. For Roulette Cricket, we implemented an overall league table on launch, and then per-match league tables a little later on. The latter meant that that new players still had somewhere they had a chance of making a splash; the overall leagues were becoming too crowded, and dominated by the fanatical players who’d been there since the start. Key learning: Make your audience feel like they’re part of something bigger, and give them somewhere they can shine.
Tom hume, managing director of app developer Future platforms, offers some key learnings from a decade spent developing mobile applications
deV Zonetime, we’ve had almost 100,000 downloads, and seen a frightening level of dedication from some of our players. What have we learned doing this? A few lessons stand out:
roulette Cricket takes data from live cricket matches and allows users to bet on where the next boundary will be, in real-time
The last couple of years have seen the emergence of
dozens of mobile advertising networks, some big, some small, some global, some local, but all united in their aim of trying to match publishers who have mobile inventory to sell, with advertisers looking for new ways to reach and engage with consumers. The market has attracted the attention of the big internet players, with both Google (AdMob) and Apple (Quattro Wireless) acquiring mobile ad networks of their own.
Win-win situationWhile ad networks battle each other for supremacy, one company is making a name for itself by coming at the market from a slightly different angle. Smaato aggregates the inventory from thousands of mobile publishers and developers, and opens it up to ad networks from around the world, creating a win-win situation for both sides. The publishers maximize their inventory’s revenue potential by opening themselves up to more advertisers, while the ad networks gain access to this inventory from thousands of additional publishers and mobile developers.
Smaato started out in August 2005 as a mobile application developer. It produced a couple of smartphone apps,
including a newsreader and a cost-controlling app, before it changed tack.
“We very quickly recognized the need to monetize apps, as very few consumers were willing to pay for software,” explains Smaato CEO and co-founder, Ragnar Kruse.
At this point, Kruse and his team could have been forgiven for simply launching an in-app mobile advertising network, and indeed, they prototyped just such a solution at CTIA in March 2006. But Kruse realised also that mobile apps have global reach, so in order to monetise an app through advertising, you would need multiple advertising sources across multiple territories. This was the genesis for Smaato’s incarnation as an ad network aggregator and mediation platform.
local knoWledgeSmaato ceo ragnar kruse tells david murphy how the company’s mobile ad aggregation and optimization platform benefits advertisers and publishers alike
Smaato in numbers
16bn ad requests per month
7,000 publisher and developer partners
50+ ad network partners
220+ countries
51 employees
Three offices in Redwood Shores (CA), Hamburg (Germany), Singapore
“we always thInk about the end user and about how we Can make advertIsIng more relevant to them by vIrtue of where they are In the world”
rugnar kruse (far right), with fellow co-founders harald neidhardt (l) and
Today, the company serves more than 16bn advertising requests per month, within mobile apps and websites, across more than 220 countries, working with more than 7,000 publisher and developer partners, and more than 50 ad networks. The business model is a revenue share from the money that Smaato helps its publisher and developer partners to generate by opening up their inventory to its mobile ad network partners. “If they make more money, we make more money,” Kruse explains.
One of the reasons the company has been so successful in attracting publishers is the fact that is has made it so easy for them to build a scalable business, with analytics at the heart of the Smaato offering.
“The way we explain it is to tell publishers that they just need one SDK (Software Development Kit), and they get one dashboard and one cheque,” says Kruse “Our SOMA (Smaato Open Mobile Advertising) platform automatically connects them to 50 ad networks, and the dashboard gives publishers an aggregated and detailed view by country level. We provide comprehensive analytics tools
across all mobile platforms and operating systems, so publishers and developers can see how the ad networks in any given country are performing; what the revenues are, the clickthrough rates, the CPMs and all the other key metrics.”
Sales teamSmaato’s publishers and developers also have access to a direct sales team who are on hand to help them monetise their inventory on a global basis. A parallel team works with ad network partners to ensure that they have the right inventory for their advertisers’ campaigns. The presence of Smaato’s offices in three continents (California, Germany and Singapore) provides virtually round-the-clock support for the company’s clients during business days.
The appeal of the Smaato network to a publisher looking to maximise ad revenues is self-evident. For mobile ad networks, the attraction is equally obvious. Smaato enables them to extend their reach to its 7,000 publishers and developers (including taking online networks mobile), while at the same time offering compatibility across all mobile
platforms, and offering the potential for attractive in-app advertising on popular platforms such as the iPhone and Android.
Where offered by the publisher, Smaato’s SOMA platform also enables the ad networks to offer their advertiser clients precise targeting by location, gender, demographics, metadata and age. Little wonder then, that those 50 ad networks include some of the world’s largest, including InMobi, Millennial Media, JumpTap, Mojiva, BuzzCity and AdMob.
global aggregator “We see ourselves as a global aggregator of local ad networks,” says Kruse. “We always think about the end user and about how we can make advertising more relevant to them by virtue of where they are in the world. In addition to the large networks we work with, we also make an effort to find the best local, smaller ones in Belgium, Bangladesh or wherever it might be.”
Smaato’s growth since its launch five years ago has been impressive, but Kruse feels there is much more to come. “This market is becoming
bigger, and that is driving more advertiser attention,” he says. “It was clear that Google would be a big player in this market, and it’s also great that Apple is involved, because it will help to drive the user experience and help with standardization, even if Apple doesn’t like Flash at this moment in time.
“If you take a country like Indonesia, 50 per cent of the population will access the web through a mobile this year, but digital marketing and advertising in Indonesia is less than 1 per cent of the total, so in countries like that, mobile will be very much larger than digital,” says Kruse.
established marketsThere’s good news from more established markets too. In the US, says Kruse, premium advertisers are making the move to mobile, and Smaato is playing its part by working with the ad networks to help on standardization of rich media ads that big brands want to use. Once this is established in the US, he says, it will be rolled out to other countries in order to attract more big-name brands and advertisers to the mobile channel on a global basis.
This all tallies with what independent analysts and expert commentators have been saying for some time now: that after all the hype, mobile advertising is starting to deliver, and that as it does so, it will attract more advertisers and encourage more content owners to go mobile. J.P. Morgan estimates that mobile advertising spend will more than double in the next two years in the US alone to $566m (£368m) in 2012. That being the case, the revenue opportunity for a company like Smaato that brings the two sides of the mobile advertising market together on a global basis is only going to get greater.
Smaato gallery
(l-r) Zedge is a social networking site for free user generated content such as wallpapers, ringtones, themes, picture messages and mobile videos. users can create, download and rate the content; MocoSpace is a mobile web site for chat, photo-sharing, instant Messaging, blogging and games, very popular in the uS; qeep is a mobile social community where users can blog, message each other, share photos, and play multiplayer games; accuWeather’s iphone app is part-funded by in-app advertising
indiacheap data charges, affordable handsets and a rapidly expanding subscriber base are making india ripe for successful mobile marketing campaigns. Martin conway reports
“wIth 500m subsCrIbers, mobIle Internet Is the bIggest medIum In IndIa. Compared to an estImated 150m who subsCrIbe to magazInes, and 200m wIth fIxed Internet aCCess”rohit dadwal, mma asia pacific
The maxim ‘you snooze, you lose’ could hardly
seem more appropriate when applied to India’s burgeoning mobile sector at present. With some 500m mobile subscribers situated across the country, and many of India’s leading telcos catching on to the vast potential of mobile advertis-ing, brands could be missing a big trick if they fail to wake up to one of the largest, most receptive audiences on Earth.
“Mobile internet is grow-ing faster in India than we expected, and has caught everyone by surprise over the past 18 to 30 months, with ad spends having doubled in the past six months alone,” says Rohit Dadwal, managing director, Mobile Marketing As-sociation (MMA) Asia Pacific. “We’ve estimated that, if the mobile marketing sector is
worth $20bn (£12.5bn) globally, India currently holds a share of $25-$30m. We expect this to increase to $150-$200m in the next 12 to 14 months, with SE Asian countries like Indone-sia, Thailand and the Philip-pines following suit.”
Dadwal’s views are echoed by Dr Vinod Vasudevan, group CEO at mobile marketing solutions firm Flytxt: “Mobile marketing in India will grow to over 10 per cent of all adver-tising spend, provided the op-erators’ assets - consumer data and inventory - are brought into the mobile marketing and advertising ecosystem,” he tells Mobile Marketing.
Long plagued by poor quali-ty fixed line internet networks and restricted bandwidth, in those areas of the country where networks are indeed available, Indian consumers
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the real world
have found their handheld mobiles to be the most sure-fire means of accessing the internet. And with a heavy national reliance on SMS, this makes text-based campaigns a no-brainer for mobile market-ers seeking to expand their activities within the country.
As the MMA’s Dadwal puts it: “With 500m subscribers, mobile internet is the biggest medium in India. Compared to an estimated 150m who sub-scribe to magazines, and 200m with fixed internet access, consumers using mobiles have emerged as the most highly prized target audience.”
India-headquartered, global mobile advertising network InMobi, whose clients include Reebok, Yahoo, IndiaTimes and Nokia, is one of the com-panies trying to help brands to target consumers via the mobile channel. CEO Naveen Tewari says: “Mobile market-ing in India mainly consists of SMS, search and display ad-vertising. While SMS advertis-ing is still the largest, display advertising is the one that is coming up pretty fast, and it’s this that will be the future of mobile advertising.”
handset competitionThere are several key driv-ers behind the phenomenal growth of recent years. Both Dadwal and Tewari iden-
tify steep reductions in data charges as an important contributor. Tewari says: “The Indian operator market is extremely competitive, and operators offer extremely af-fordable prices for data plans.” In addition, the roll out of 3G services across the country is set to provide a much-needed boost to data capacity.
One of the most crucial factors, however, has been the growth in availability of local-ly-produced, affordable hand-sets. Dadwal comments: “You can now find a locally made smartphone, with camera, colour screen and GSM 2.5G packet technology for about $100.” Albert Almeida, COO of Hungama, a leading Indian developer, publisher and dis-tributor for mobile, cable and video on demand services, has also noted this trend. “Cheaper portable devices are springing up everywhere, either manufactured locally or in China or Taiwan,” he says. “These look good, feature touchscreen capabilities, and are data-ready. They will make mobile marketing a reality in India by 2011 or 2012.”
This glut of cheap phone options has certainly put the wind up Nokia, still the best-selling handset manufacturer in India, with an estimated 65 per cent share of the market. Dadwal says: “Nokia’s really started to feel the pinch from local manufacturers in the last six months. For the first time, we’ve seen Nokia’s traditional rivals, such as Samsung, LG and Sony, having to compete for third or fourth position with local companies such as Micromax Mobile and Kar-bonn Mobile, both of whom have come from nowhere, but are now selling at least 15m handsets a month.”
This diversity of handset brands and types highlights the need for astute forward planning and experienced mobile marketing firms
when it comes to formulating campaigns. “India is still an emerging economy, and the most common phone is the ba-sic Nokia 3110 Classic,” notes InMobi’s Tewari. “This means that to reach the masses, ads need to be created keeping the low-end phones, not the high-end smartphones, in mind.
“This is where an ad net-work such as InMobi comes in. There are over 9,000 devices and advertisers can’t be trying to create ad units for all of these models. They need to concentrate on the objective of the campaign and the target audience. Mobile marketing in India needs a thorough understanding of the nuances, patterns and emotions of the people, for example, to create successful ads. Due to the large and ever receptive audience, a good campaign can reap big benefits over here.”
Cultural influencesTo glean this understanding, advertisers need to consider India’s mobile sector in terms of both cultural and practical habits. Few might be sur-prised to learn that most Indi-ans, in Tewari’s words, “follow cricket like a religion”, and that, “if mobile advertising can be leveraged during any of the international matches, these campaigns are likely to perform extremely well.”
In terms of popularity, how-ever, even cricket is trumped by Indian people’s love of tra-ditional music – including the tunes produced en masse by the vibrant Bollywood film in-dustry. This has led to high na-tional demand for Bollywood-themed ringback tones (RBTs), which Flytxt’sVasudevan describes as “one of the main-stays of India’s value added services market.”
It would be a mistake, however, to overlook the wide range of popular musical influences across the country. Hungama’s Almeida is well
Most indian mobile users are on prepaid contracts
“IndIa Is stIll an emergIng eConomy, and the most Common phone Is the basIC nokIa 3110 ClassIC. thIs means that to reaCh the masses, ads need to be Created keepIng the low-end phones In mInd” naveen tewari, Inmobi
placed to comment on some of India’s regional trends. “About 75 - 80 per cent of RBT content comprises Bollywood mate-rial,” he tells Mobile Market-ing. “But, despite the geo-graphical boundaries, there is a common culture between northern India and Pakistan. Many people in Pakistan are in tune with Bollywood and, similarly, a lot of Pakistani Sufi music is popular in the northern parts of India. On the other hand, southern India has more of a shared culture with the northern, Tamil part of Sri Lanka, and is keen on the Tamil film industry and devotional music.”
All the same, as InMobi’s Tewari points out: “RBTs are dominated by Bollywood music, closely followed by regional film music, and Bol-lywood wallpapers and themes also tend to do very well. Oth-er than this, there are smaller segments in the country that like Western music as well, and these numbers are only growing with further exposure to the West.” Most RBTs can
be accessed by Indian mobile users at a cost of between 90 cents to $1 a month.
prepaid usersThe mode of mobile usage in India should also be consid-ered by budding advertis-ers. As a cash economy, the country’s mobile subscriber base is hardwired towards prepaid usage, with fixed contracts barely a consid-eration. Flytxt’s Vasudevan comments: “About 90 per cent of subscribers are on prepaid contracts, as are 95 per cent of new users, so it’s definitely a growing base. Of India’s 500m subscribers, some 400m are unique – approximately 15 - 20 per cent of subscribers have multiple SIM cards.”
According to Vasudevan, the operators like things this way too. “Indian operators don’t really want to deal with collection issues – there is no national social security identification in India, and the number of bank accounts in India is less than 15 per cent of the total number of mobile
subscribers,” Vasudevan tells Mobile Marketing.
But the MMA’s Dadwal believes that the dominance of prepaid should not limit mo-bile marketing opportunities. “It’s a different premise to that in the West,” he says. “It’s just the way that consumers in India feel comfortable with spending their cash, removing uncertainties regarding bills.”
But as InMobi’s Tewari points out, the popularity of prepaid mobile usage does present challenges to the marketing community. “Since users don’t have to pay a big initial security deposit, and at-taining the SIM card is simple, this drives a huge user base,” he says. “However, since these SIM cards don’t necessitate any form-filling, this makes advertising a tougher objec-tive, since there is absolutely no information on the user. It also raises the possibility of ‘click-fraud’; for instance, when a user clicks on an ad to download some content, but there is not enough balance on the SIM card to complete the
transaction. While this ‘click’ will be charged to the adver-tiser, the user will not be able to complete the operation.” Tewari adds that users tend to change their SIM cards more frequently, so it becomes virtu-ally impossible to track usage patterns or unique users.
receptive marketDespite these challenges, In-dia’s mobile subscribers do ap-pear to be receptive to market-ing material on their mobiles.
indian consumers are receptive to mobile marketing campaigns
As the MMA’s Dadwal puts it: “It’s basic psychology; custom-ers want different offers and the chance to save money.” And while ‘Text & Win’ promotions have yet to get off the ground in India, there is optimism that such campaigns will snowball in popularity, in tandem with the growth of the mobile sector.
India’s regulatory regime is fairly relaxed too. So far, the Telecom Regulatory Authority of India’s (TRAI) main point of involvement has been the creation of a ‘Do Not Disturb’ list, whereby mobile subscrib-ers have been given the option to remove themselves from receiving unsolicited texts.
“Encouragingly, of the 500m subscribers, only 1m have opted out,” Dadwal says. “But there have been criticisms of the TRAI’s approach – for instance, the ‘Do Not Disturb’ list was originally introduced to clamp down on unsolicited calls from service centres, but the regulators have ignored the fact that not everything on a phone is related to voice, and that Bluetooth and SMS are being used as marketing chan-nels too. There also doesn’t seem to be an audit procedure, or accountability policy, to punish ‘fly by night’ opera-tors,” Dadwal adds.
But despite this fairly lax regulatory approach, most marketers realise that spam-ming customers on their mobile is hardly in their best interests, and most reputable
ringback rupees
RBTs enjoy a penetration of 17 to 18 per cent across India’s 500m-strong mobile subscriber base
RBTs comprise 40 per cent of the total value added services market in India
At telco level, RBTS account for about 10 per cent of operators’ total revenues
Indian mobile users download an average of 70m RBTs per month
Source: Hungama Mobile
Many mobile users in india have a basic phone – a point that brands hoping to use mobile as a marketing channel need to remember
companies in India follow variations on common-sense industry standards. “India is still a very receptive market, and not at all wary of advertis-ing,” says InMobi’s Tewari. “Marketers need to ensure that ads are not intrusive, so as to not change the receptive nature of users. Also, while creating ad campaigns, mar-keters should be aware that bandwidth and speed is still a significant issue in India.”
rapid changesIn the meantime, all involved in the mobile marketing chain are putting the blocks in place to ensure that they keep abreast of the rapid changes that lie ahead. The MMA launched its India Council in May 2009, with the aim of bringing publishers and technology providers together, developing codes of conduct, compiling reliable market data and providing education, seminars and training to both marketers and consumers.
Flytxt is pushing its Neon mobile marketing platform, which enables mobile opera-tors to generate incremental
revenue by targeting their subscribers with relevant and timely offers. Flytxt’s Vasude-van says that, using Neon, operators have seen revenue increases of up to 8 per cent.
And InMobi recently launched its $2m World Devel-oper Fund, whereby mobile app developers get to keep 100 per cent of the revenue they make from ads served within their apps by InMobi’s network, at least until the $2m fund is exhausted.
“This lucrative offer will help mobile applications devel-opers to get into mobile adver-tising and see the benefits of it,” says Tewari.
In conclusion, the InMobi
bollywood content is massively popular with indian mobile users
chief foresees increased mo-bile marketing opportunities as part of a wider, revolution-ary shake-up, set to “unify the diversified country”. He says: “So far, India has been lacking that one single platform which can reach out to the masses. As well as providing scope for increasing education in rural areas, enabling farmers to access data related to prices, increasing the reach of medi-cal and health services, and simplifying mobile banking, the potential for profitable mobile marketing campaigns is immense.”
It sounds like this is one boom you certainly don’t want to sleep on.
author of the report, Mobile Commerce Strategies: Payments, Ticketing, Coupons and Bank-ing 2010-2014, says: “Mobile ticketing provides significant cost savings for ticketing providers – there’s a reduction in paper and printing costs, for example. It’s also part of the one-to-one marketing strategy. If a provider knows I’ve bought a ticket for say, baseball, they can send me offers tailored to my interests. Putting their marketing dollars into people whose interest they know is more effective than a wide-spread leaflet drop.” He adds that the benefits for users in-clude speed and queue-busting.
Stephen Wood, director of product management at mobile transaction network mBlox, says: “The main interest for the ticket seller is that m-ticketing offers a secure and easy method for consumers to buy tickets,
with reduced costs and fraud relative to other methods.”
Mobile ticketing services are achieving these objectives. Mobiqa’s mobile ticketing solu-tions are used in more than 50 countries, and the company is working with many organisa-tions, including Ticketmaster, Movietickets.com, and airlines such as Delta and Swissair.
boarding passesIn the airline sector, Mobiqa provides mobile boarding pass-es. At the boarding gate, the passenger scans a barcode on their mobile phone screen as they would with a paper board-ing pass. Mobiqua distributes its tickets to handsets, often as 2D barcodes, via a variety of methods, including MMS, WAP (push and link), SMS and email. “The benefit for consum-ers is convenience – you always take your phone with you, so
for a growing number of people, their mobile phone
is now also an electronic ticket-ing device. The mobile ticket-ing market is set to explode. Juniper Research forecasts that more than one in 10 mobile subscribers will use mobile ticketing by 2014, with 15bn tickets delivered by mobile in the same period, compared with just over 2bn this year. The main markets for mobile ticketing today are transport, sport and entertainment, including concerts and movies. “There has been in dramatic growth in mobile ticketing in the past couple of years, espe-cially within the airline and cinema sectors. Rail and retail have been slower to develop,” says Ronnie Forbes, founder and CTO of Mobiqa, a mobile content optimisation company.
Howard Wilcox, senior ana-lyst at Juniper Research and
“we dIdn’t want someone purChasIng an m-tICket to have to pay more than someone buyIng one In the usual way. In faCt, the 4-week tICkets are 10 per Cent Cheaper”mike woodhouse, uk bus, arriva
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there’s nothing to leave behind. You can get a ticket at the last minute and then go. For busi-nesses, there are cost savings, as it’s more expensive if people have to be checked in. Cus-tomer service also improves,” Forbes tells Mobile Marketing.
Trinity Mobile provides ticketing for various sectors, including events, transport, festivals and nightclubs. Trin-ity’s business model is to offer the service free to the venue/company/organiser, with the consumer paying a booking fee. For event ticketing, Trin-ity can provide a full end-to-end service, including ticket scanners. “Nightclubs like the idea of having paperless entry into the venue. People can just turn up with their barcode in their telephone, and can
be scanned quickly - queuing can be reduced. Everybody carries their mobile, so there’s no issue about forgetting your ticket. It’s a technology that is accessible to everyone,” says Trinity Mobile sales director, Rod McKinty.
There are other benefits, he adds: “A paper-based ticket sys-tem limits how far in advance you can sell a ticket, but with mobile ticketing, people can purchase a ticket as they stand in the queue – it’s that instant.”
The key benefit for the venue is having the customer’s mobile number, which can be used for post-event market-ing, for example, to promote other events or offer ringtones or music downloads. Mobile ticketing is catching on fast in the events sector - Trinity Mo-
bile’s mobile ticketing service was used at the West Festival, which attracted 10,000 people, while the Gatecrasher club in Birmingham, UK, only offers advance tickets by mobile.
on the busesmBlox has worked with technology company CDT to provide a mobile ticketing solution for the transport company Arriva, which offers the service on around 1,000 UK bus routes, covered by more than 4,500 buses. The service was launched nationally in November 2009. CDT has devel-oped an m-ticketing app in the form of a small Java file that can be downloaded onto some 90 per cent of handsets. There are also larger apps for iPhone, Android and BlackBerry hand-
sets. The second component of the system is the back-end server platform that deals with product updates, payment processing and version control. Users can register for the m-ticketing app via a website, and then receive a WAP-push link to start the download process. Daily, weekly or 4-week tickets are available.
Credit or debit card payment is used, and the ticket is down-loaded to the user’s handset. It is an open ticket and is only activated when it is used. Arriva uses a visual verifica-tion system, with the driver checking the ticket, which is date stamped and includes security features. The ticket automatically self-deletes when it expires. “We call it Martini ticketing [anytime, anyplace, anywhere], and emphasise its speed, ease of use and security – if you lose your phone, your m-ticket can replaced,” says Mike Woodhouse, marketing manager UK Bus, at Arriva.
“The biggest challenge is that services like m-ticketing involve moving data around, and the consumer should not have to bear the cost,” says mBlox’s Wood. “If I’m buying a 70p ticket for the bus, and also
Train companies are beginning to embrace mobile ticketing
“there Is a need to eduCate the market. Consumers are quIte easy to eduCate – people take to the teChnology very quICkly. busInesses are muCh harder to ConvInCe”ronnie forbes, mobiqa
arriva launched mobile ticketing in 2009. a recent survey found 86 per cent customer satisfaction with the service
have to pay an additional 50p in data charges, that makes a significant difference to the overall price of my ticket.”
To avoid this scenario, the Arriva system uses an mBlox solution called Sender-pays Data. “Sender-pays Data ensures that the consumer doesn’t get charged; instead, the content provider pays for it. This is critical for this type of service,” adds Wood.
“We wanted to use a Sender-pays Data system, because we didn’t want someone purchas-ing an m-ticket to pay more than someone buying one in the usual way,” says Arriva’s Woodhouse. “In fact, the 4-week tickets are 10 per cent cheaper. People are now comfortable purchasing goods and banking online because they trust the systems, and we believe the same will eventually happen with m-ticketing.”
additional servicesSender-pays Data offers other benefits, says CDT managing director, Larry Breen. “You can wrap additional services around the m-ticket, such as real-time information, or com-bined train fare and car hire. The m-ticket remains the core offering, but other things can
be added. Because the con-sumer isn’t paying for the data, they will be more inclined to browse and search for addition-al services.” Since the launch of Arriva’s mobile ticketing service, more than 300,000 journeys have been made using m-tickets, and more than 18,000 people have registered for the service. An initial Arriva survey revealed 86 per cent customer satisfaction with the m-ticketing service.
Mobile ticketing still faces challenges, however. Many ticket issuers would like to use contactless near-field com-munication (NFC) technology, but the cost, coupled with the small number of NFC-enabled handsets and readers in most markets currently prohibit its widespread adoption – a major exception is Japan, where the NFC-enabled Mobile Suica m-ticket is used by millions of rail commuters. “There is a need to educate the mar-ket,” says Mobiqa’s Forbes. “Consumers are quite easy to educate – people take to the technology very quickly. Busi-nesses are harder to convince.
Juniper Research’s Wilcox notes that there’s also a dif-ficulty in a multi-ticketing environment. “In the UK, there
are more than 20 train operat-ing companies,” he says. “For mobile ticketing to work, all on-train staff, station ticket barriers and train operating companies need to be able to read my mobile ticket: there is the danger of potential bad publicity if the system does not work as it should do.”
But CDT has developed a mobile ticket for national travel, approved by the UK’s train operating companies. The m-ticket will be rolled out by Raileasy this autumn. Until re-demption equipment is widely available, however, the default position is for users to obtain a paper ticket from a Fast Ticket machine or station counter using a reference number. CDT has also developed a mobile ticket for use in several Asian countries, with ticket informa-tion and language automati-cally updated in each country.
Despite the challenges, sup-porters of mobile ticketing are optimistic about the future. “I’m convinced that m-ticketing usage will reach a tipping point over the next few years, in the same way as with internet banking, 10-15 years ago,” says Arriva’s Woodhouse. “The market is yet to catch-up with where we are now,” adds CDT’s Breen. “M-ticketing technology ticks all the boxes.”
“If a provIder knows I’ve bought a tICket for say, baseball, they Can send me offers taIlored to my Interests. puttIng theIr marketIng dollars Into people whose Interest they know Is more effeCtIve than a leaflet drop”howard wilcox, Juniper research
Some airlines have replaced paper boarding passes with mobile versions to speed up the boarding process
Mobile tickets are finding favour with nightclubs, who like their queue-busting abilities
arriva’s m-ticketing solution has proved popular with passengers
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when Adfonic Chief Marketing Officer
Paul Childs tells you, by way of introduction, that the company launched its self-service mobile advertising marketplace in July 2009, it’s tempting to cut him off in mid-sentence to ask him what on earth they thought they were playing at. Because by that point, companies like AdMob, Millennial Media and Quattro Wireless were already so well established that you could be forgiven for asking how a new entrant hoped to make any sort of headway.
When I go ahead and pose the question, Childs does not miss a beat, but explains, mat-ter-of-factly: “The thing that gave us the confidence that we could succeed is our experi-ence. The founders of the company have been working in mobile advertising since late 2005 [Childs, CEO Victor Malachard and CTO Wesley Biggs were all previously at Motricity and Infospace] so they know the space pretty well. We also understood the potential opportunity from a European perspective, be-cause in 2008, when we started planning for the launch of the company, there were no US or Asia Pacific players operating in Europe.”
“Moreover, if you look at the saturated online space, there are hundreds of online
despite the competition, adfonic, the only global mobile ad network out of europe, is thriving, says david Murphy
ad networks out there. If you compare this to the mobile space, things are only just starting to take off. Adfonic is already one of the top 10 truly global players and one of only a few remaining independent ad networks, following the re-cent acquisitions in this sector by Google and Apple.”
Adfonic, which remains the only home grown European global advertising network, seized the opportunity with great aplomb, accumulating inventory from day one, and today, counts brands such as Betfair, Yell, Peugeot and Sky, among its advertiser clients. The company is also working with many more household-name brands in the UK and across Europe, through tradi-tional, digital and specialist mobile agencies.
bidding model Adfonic operates a bidding model, similar to the one adopted by other mobile ad networks, including AdMob and InMobi. Advertisers pick a price they want to pay, on a CPM (cost per thousand) or CPC (cost per click) basis, with the price paid having an influencing factor over the performance of the ad, together with the performance of the creatives themselves.
In the early days, says Childs, there was a bias towards apps, but today, the
company also sells inventory for many mid-tier mobile site publishers, alongside iPhone and Android app developers. “There is still a slight skew towards mainstream apps, but as we grow our volume, we’re opening up more vertical channels, enabling brands to advertise and target on this basis” says Childs.
Volumes are indeed grow-ing nicely. There are over 2,000 publishers in Adfonic’s network, generating earnings from a pool of approximately 3,000 live campaigns. The com-pany is on track to be serving 2bn impressions per month by the end of the year.
It is also expanding in other ways; it already has someone on the ground in the US, driv-ing publisher acquisition, and is recruiting ad sales, business development and engineering staff in Europe. The expansion is being funded by organic business growth and a recent multi-million dollar second round of funding, closed in August 2010.
There has been lots of talk in recent months about the ongoing evolution of mobile advertising, with strong em-phasis on new formats, says Childs. “At Adfonic we are excited about developing and launching new formats and are already serving campaigns on the devices that bring the best out of these formats, such
“the vast maJorIty of mobIle advertIsIng dollars are stIll on statIC and anImated banners”paul Childs
as the iPad. However, let’s be clear that the vast majority of mobile advertising dollars are still on static and animated banners and advertisers who are willing to invest in produc-ing these new formats are still few and far between.”
TransparencyA key message for Childs and his team since the company’s launch has been around trans-parency in mobile advertising. “We believe it’s crucial that advertisers know who they’re talking to, how their campaign is performing in real-time, and whether they achieved the campaign objectives. Most ad networks do not cover the end-to-end piece,” he says.
On a day-to-day basis, this manifests itself in a number of ways. Before the campaign runs, it’s about audience selec-tion, offering advertisers the ability to target mobile users via demographics and other parameters, such as location, device, connection type and time of day. “This is well established online, but in the mobile space, we’re not there yet in terms of giving adver-tisers richer data for audience selection,” says Childs. “This is what we’re trying to deliver for our clients.”
During, the campaign, it means more and better information for advertisers about how their campaign is performing, giving them more control and more ability to change things while the campaign is still live. “We have one of the best reporting tools out there, which means advertisers get much more information about whether clicks are occurring over wi-fi or operator connections, where clicks are happening, how creatives are performing and much more,” he says.
And post-campaign, it’s about giving advertisers actionable information. For example, Adfonic supports application install tracking for iPhones, enabling advertisers to track the cost per installa-tion of an iPhone app. Adfonic only counts an app instal-
lation as “successful” once the mobile user has clicked on the ad, downloaded the app, and then opened it. This means that an advertiser can measure how many clicks on their ad are required for each user who downloads the app and uses it. For example, if 10 people click on an ad, six of these might download it, and of these, three may actually ever open it up and use it.
“The bottom line is that most of our advertiser inven-tory is commercial apps, such as a Voice over IP app, where people make some kind of payment to buy it or to use it. As a marketing director in an organisation spending money online and offline, I want to know where I can get custom-ers in the best and most effi-cient way,” says Childs. “This is the information we are delivering to advertisers, so they can see how advertising on our network compares with posters on the tube or pages in print media.”
geo-targetingWith the Adfonic network now established, Childs is looking to the future, and says the company is seeing “significant ramp-up” from Android, with the device portfolio increas-ing, and many developers who have launched iPhone apps looking to move them to, and develop new ones for,
the Android platform. He says the company is also seeing demand for geo-targeting, with advertisers looking to target mobile users on a city or postal district basis.
“It’s an exciting time,” he says. “We are driving good fill rates and earnings for our publishers, and delivering great results for our advertis-ers across the world, and we have a very clear roadmap for how we take that on from here in the future.”
It might have been a brave move to launch against AdMob, Millennial et al just over a year ago. But on the evi-dence so far, it was anything but foolish.
adfonic serves advertising within the yell.com iphone app
peugeot’s mobile advertising campaign enables users to request a brochure, book a test drive or find a dealer, all from their handset
JudgeMenT daythe deadline for entries for the emmas, our new awards programme for the mobile marketing industry, is approaching fast
If you have not yet submitted your entry or entries for the
Effective Mobile Marketing Awards (aka the EMMAs), time is running out. The deadline for entries is Friday 24 September.
The EMMAs recognise the effectiveness of mobile marketing campaigns, applications, sites and other activities. There are 13 categories, including a Grand Prix award which will be voted on at the Awards Ceremony, taking place in London in December. In each category, we are concerned only with one thing: effectiveness. We want to find, and recognise, the mobile applications, campaigns, websites and other promotions that have best succeeded in meeting campaign objectives, whether that’s to raise brand awareness, increase sales, or whatever the brand was seeking to do.
We have secured the services of some of the best names in the business to join our judging panel, including Jonathan Bass, managing director of Incentivated; Russell Buckley, vice president, global
eMMas category breakdown:
most effective mobile advertising campaign
most effective mobile application - b2c
most effective mobile application - b2b
most effective mobile operator opt-in subscriber database campaign
most effective mobile cRm/enterprise messaging campaign
most effective sales promotion/direct Response campaign
most effective mobile site
most effective mcommerce solution
most effective location-based service/campaign
most effective bluetooth marketing campaign
most effective mobile couponing or barcode campaign
most effective mobile search campaign
grand prix award
you can enter the emmas now via our website, head for:
www.mobilemarketingmagazine.com/emmas
entry is free, and the closing date is 24 september. you can find full terms and conditions on the website.
For more details about the awards ceremony, contact: [email protected]
vinopolis is the venue for the inaugural eMMas award ceremony in december
eNtRy deadliNe24 Sep
who will take the award for Most effective location-based Service/campaign?
argos is among the brands vying for the Most effective b2c Mobile application award
alliances at AdMob; Jeremy Copp, vice president, mobile Europe at comScore; Ben Cusack, creative director at Mobile Interactive Group; mobile specialist Helen Keegan; Nick Lane, CEO of mobileSQUARED; Alex Meisl, chairman and founder of Sponge; John Mew, head of mobile at the Internet Advertising Bureau; and Bob Wootton, director of media & advertising at the ISBA.
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There’s a big focus on mobile at this year’s ad:tech event,
which takes place at Olym-pia in London from 21 – 22 September. A special section of the event, the Mobile Market-ing Show, is supported by the Mobile Marketing Association, and features a number of mo-bile marketing firms including AdMob, Open Market, Netsize, 2ergo, Golden Gekko, Grapple Mobile, BuzzCity and Adfonic.
Mobile Marketing magazine is also exhibiting too, on stand
ad:Techgoes mobilelots of suppliers, a big focus on apps, and wall-to-wall mobile marketing presentations make this year’s ad:tech show one you can’t afford to miss
368, and our editor, David Mur-phy, is speaking on Tuesday afternoon at 2.30 in the Mobile Marketing and Apps theatre. His presentation is entitled: ‘Why no brand can afford to ig-nore mobile’ and will examine the power of mobile marketing to raise awareness and drive sales, drawing on a number of case studies to show how brands and organisations of all shapes and sizes are using mobile successfully.
Over the course of the two
days, in fact, there are no less than 20 mobile marketing presentations, covering every-thing from mobile application development and mobile cou-poning to local and location-based advertising. (For more details, see the panel.)
apps ZoneThis year’s event also features the Apps Zone, where visitors can gain valuable insight into the development and distribu-tion of mobile applications.
App experts will be on hand to give advice, share case stud-ies and demonstrate all aspects of mobile apps, from creative and development, to advertis-ing, measurement and gaining visibility for your app in the app stores. Delegates will also have the chance to play with a
diverse selection of apps, with varying functionalities, on a wide range of handsets and quiz the people who built them on exactly how the develop-ment process works.
Google will also be running free-to-attend sessions as part of the Google Ads Factory tour. Over the two days, the tour will look at how best to utilise Google’s advertising solutions in four main product areas: Mobile & Local, Search, Google Display Network & Analytics.
The sessions will include the latest innovations within these product areas, as well as expert guidance from Google on how to maximise the results of your campaigns using Google products. It’s a great chance to learn from the experts.
Tues 21 Sep
10.30 innovative ways to connect and retain contact with audiences using mobile Mark Johnson, creative director, sequence
11.10 How to build a successful app: the lessons learned in the journey to becoming the uk’s first hosted gpu farm Melville carrie, Vp product marketing, cortexica
11.50 the new marketplace: an evolution in mobile? ben Tatton-brown, sVp, amobee
12.30 the real consumer perspective on mobile advertising rob Jonas, Vp and managing director europe, inmobi
1.10 Five ways to create and improve revenues from mobile marketing alexander vlasblom, marketing director, Netsize
1.50 taking your campaigns mobile – How to extend your reach to a new audience Paul childs, chief marketing officer, adfonic
2.30 why no brand can afford to ignore mobile david Murphy, editorial director, mobile marketing
3.10 a practical guide: how to build a mobile proposition that engages and converts duncan hallas, Vp business development, Netbiscuits
4.30 the apps explosion and key opportunities for brands Patrick Mork, chief marketing officer, getjar
weds 22 Sep
10.30 the reality beyond the hype: location-based mobile marketing ben brown, ceo, Vouchacha
11.10 taking advertising local – through mobile dr richard M Marshall, founder and chief technology officer, Rapid mobile
11.50 extending video and video advertising to mobile devices david Springall, chief technology officer, yospace
12.30 challenges and opportunities of developing apps for all mobile platforms Magnus Jern, ceo, golden gekko
1.10 maximise the potential of rich media mobile marketing by eliminating the cost to your consumers Stephen wood, director of product management, mblox
1.50 your brand in their pocket: now what? Stefano diemmi, managing director, b!digital uk (buongiorno) 2.30 android, ipad, iphone...monetising mobile across platforms nicholas cumisky, senior industry manager, admob
3.10 building brand loyalty through m-couponing ariya Priyasantha, head of mobile ticketing & couponing, 2ergo
3.50 mobile advertising: making display and search work together Jonathan Mew, head of mobile, interactive advertising bureau
4.30 unlock the potential of mobile marketing with network enablers: drive sales and brand engagement with mobile crediting alex Moir, general manager europe, open market
Mobile Marketing Presentations
google will be offering free presentations as part of the google ads Factory tour.
More than 7,000 business executives visited last year’s event, with 55 per cent saying it was the only marketing event they would attend in 2009. 51 per cent said their principal reason for visiting the show was to find new digital market-ing products, 27 per cent to find a supplier of digital marketing services, and another 22 per cent said they came to find alternative solutions providers.
Whatever you’re looking for, ad:tech is a great place to meet mobile marketing, and other digital service suppliers, hear first-hand about success-ful strategies and tactics, and network with your peers. There’s still time to register to attend the show. Head for: www.ad-techlondon.co.uk
ad:tech is a great place to meet potential new suppliers
applicatioN ShowcaSeinstead of campaigns, in this issue, we are turning the spotlight on some mobile apps that have caught our eye
chant dashboard. This allows retailers to set the period the offer runs for; the number of downloads per user or in total; the location for the offer; and the level or type of discount. Retailers can also integrate a barcode or reason code (a randomly-generated unique number) into their offer. This speeds up the transaction, and enables the retailer to monitor the uptake of the digital offer and integrate the data into their own sales systems. Retailers can amend or submit new offers and then track redemptions. They also have the option of buying campaign results data.
The company behind Vouchercloud, Invitation Digi-tal, started out producing print-based voucher books in cities up and down the UK for many years, so it has a good relation-ship with many leading High St. brands, and has been able to move many of these onto its iPhone offering. The list of brands using Vouchercloud in-cludes Strada, Subway, Odeon, Vue, Zizzi and Burger King, and the company estimates that in the first five months following the launch of the app, Voucher-cloud’s mobile vouchers saved UK consumers over £1m.
sites can be pinpointed on a Google map which is integrated into the application. Users can also search for the vouchers they want by category.
The digital voucher is de-livered straight to the mobile screen. To redeem it, users show the voucher on the phone screen to a member of staff who applies the necessary dis-count. Hitting the Redeem but-ton confirms that the voucher has been redeemed and, in the case of a one-time-use voucher, invalidates it for further use. Vouchers can also be down-loaded to the user’s handset and they can be used when there is no phone signal or internet connection available.
The other side of the equa-tion is the retailers with offers to promote. Vouchercloud makes it easy for them to upload their branded offers directly to the Vouchercloud mobile app and website via a bespoke, web-based mer-
vouchercloud AppStats
Developer: Invitation Digital Launch date: Feb 2010Platforms: iPhone. (Android launching Q4 2010)Cost: FreeMonetisation: In-app advertising, premium vouchers, local business advertising, brand campaigns Estimated downloads
(to 10 Sep 2010): 775,000
best practice38
Vouchercloud is a discount voucher app for the iPhone that enables consumers to save money in restaurants, bars, on days out and in retail stores. Users can download digital vouchers direct to their screen and then redeem them at the point of purchase.
The app uses location-based technology, enabling users to download vouchers for retailers based on their proximity to their location, using a search radius and listing results. Al-ternatively, voucher redemption
september 2010
huddleHuddle is a neat enterprise app for the iPhone, iPad and BlackBerry, from a company of the same name, which provides intercompany collaboration in the cloud.
Huddle enables members of a company to collaborate on projects from remote locations. Users can create a project and share documents with other users online. Tasks can be assigned to individual users, and there’s also an RSS function to alert users to any changes in the project plan or any new documents available to view. The app gives users full access to document sharing, project tasks, discussions and whiteboards,
and a complete view of the user’s personalized dashboard.
The most recent version of the app, designed and built with the help of Rapid Mobile Media, is for BlackBerry, and is optimized for BlackBerry Pearl (8100-8230), BlackBerry Curve (8300-8900), BlackBerry Bold (9000-9700), BlackBerry Storm/Storm2 (9500-9550), and BlackBerry Tour (9630-9650) on BlackBerry OS 4.5 or higher.
The read-only version of the app is free to all users. Upgrading to the fully-featured version costs £2.99/$4.99 and enables users to upload files, reply to discussions, and edit and manage data. A very neat b2b solution.
Shazam on the radio or a hi-fi system simply by holding the phone up to the speakers. Shazam then compares what it heard to its database of 8m songs and returns the name of the song, artist, the album it’s taken from, and cover art. If you’re one of those people who loves to show friends the clever stuff your phone can do, Shazam is about as clever as it gets
In its initial incarnation, the user had to dial a number to use the service and pay for each song identified, or “tagged” in the Shazam vernacular. Now, users download Shazam as an app, and in addition to identifying the music, can preview 30-second clips, buy tracks, find local and international tour dates for the tagged artist and buy tickets to their gigs. Users can also get track recommendations and share music moments by sending Tags as a Tweet, to a Facebook mini-feed or by email.
The app comes in a free version, which limits users to five tags a month, or they can upgrade from within the app
to the premium version for an annual fee of $2.99 (£1.95). A lifetime subscription is also available for $4.99.
Since its launch in 2002, over 75m people have used the service to identify music, and it has been used to identify over 1bn songs. Shazam also produces the Shazam Tag Chart, which the music industry uses as an indicator of market interest in pre-release material, and the hit potential of a track or artist. The app has also picked up numerous awards along the way.
AppStats
Developer: Shazam EntertainmentLaunch date: 2002 (service); July 2008 (app)Platforms: iPhone/iPad, Nokia, Android, Windows Mobile, BlackBerryCost: From free to £2.99/$4.99Monetisation: Paid-for, plus in-app advertising on free versionsEstimated downloads (to 10
Sep 2010): 75m users
Shazam is a long-established music discovery service, initially launched in 2002, that reinvented itself as an app a couple of years ago. It enables users to identify a piece of music being played
evening?’ As soon as you type the letter ‘A’, the app offers the word ‘Are’ as the one it thinks you are most likely trying to type. Two other suggestions, ‘A’ and ‘Also’ are also offered to either side of the word ‘Are’. To select any of them, just touch the word on the screen, or touch the space bar to select the word SwiftKey thinks you most likely want, in this case ‘Are’.
As soon as you confirm that ‘Are’ is what you were trying to type, SwiftKey suggests the word ‘you’ as the next word you wanted. Makes sense, but it’s still impressively intuitive. It’s next guess ‘going’ is no use, nor are the other two words it offers, so you start typing the word ‘planning’. After typing just one letter –‘p’ – it suggests ‘planning’ and the rest you can probably work out. It
means that a sentence can be typed with around a third or a quarter of the key presses that would be required on a normal phone. Better still, it learns as you use the app, so if there’s a text you send out on a weekly basis such as: ‘Are you around for football tonight?’ it will virtually do it at one key press per word after you’ve typed it the first couple of times.
Such intuition doesn’t happen by accident. TouchType analyzed more than 50bn words in nine major languages to build the models that drive SwiftKey’s prediction engine. The app achieved 100,000 downloads in its first week on Android market and will receive many more in the weeks and months to come, even when they start charging for it.
Spb Mobile Shell
of picture contacts with Facebook; account-sensitive email indicators; time and weather screens; widgets; responsive kinetic scrolling; a 3D animation engine; and other assets that change the way the phone is used.
SPB Mobile Shell was initially launched in 2007 and has picked up several awards and shipped across millions of devices from more than 15 manufacturers. SPB regularly updates the app, constantly adding new features and functionality. The most recent update to the Symbian version included optimized memory
usage, plus a media player widget that enables users to launch the media player from the home screen. SPB also released four new, free themes for Symbian for customisation of the user interface, and other improvements included shortcuts to the most-used files; a customized ‘Call’ button; the addition of New Memo and New Anniversary items in the organizer menu; and landscape/portrait orientation control, to display items in the most appropriate format.
The multi-language app comes on a free 15-day trial, and costs $29.95 (£21) thereafter.
AppStats
Developer: TouchType
Launch date: July 2010Platforms: AndroidCost: FreeMonetisation: Moving to paid-for model very soon
Estimated downloads (to 10
Sep 2010): 250,000
SwiftKey, from British start-up TouchType, is a terrific Android app that is fantastic for anyone who composes a lot of emails or texts on their phone.
Predictive text is one thing, and is undoubtedly a useful timesaver on most phones. But SwiftKey takes things to another level; rather than predicting individual words, it effectively predicts the sentence you are trying to write as you compose it, in real time.
Take the sentence: ‘Are you planning to come out for the meal after work on Tuesday
SPB Mobile Shell, from the German company SPB Software, is a sophisticated, next-generation user interface for Windows Mobile and Symbian phones. The app offers distinctive ‘professional’ and ‘lifestyle’ desktops; integration
41best practice
june 2010www.mobilemarketingmagazine.com www.mobilemarketingmagazine.com
mobile specialist helen keegan considers the potential for mobile apps and services in the retail industry
oFF-deCk
i’ve been looking at a lot of apps over the past few weeks, in my role as a judge for
the Vodafone Mobile Clicks competition, and there seem to be two areas of life that mobile developers are currently focused on.
The first is conferences. I’ve lost count of the number of apps I’ve seen lately that are designed to facilitate easier and speedier networking at conferences. I must admit, I’m somewhat baffled by these. In my experience, people who at-tend conferences tend to be pretty good at starting conversations with each other, and in my view, any attempt to formalise the networking process risks losing the serendipity of the chance encounter that ends up presenting you with a great busi-ness opportunity. I think most of the good contacts I have ever made from network-ing are people who, had you told me their job title and the name of the company they worked for before the event, I would have made no attempt to meet.
Mobile couponsThe other area of focus for mobile app developers currently seems to be around mobile coupons and vouchers to redeem in retail outlets. Here, I think the developers definitely are barking up the right tree. All estimates suggest that shopping on the mobile is going to be huge, and I am seeing plenty of evidence to back that up.
Firstly, take Marks & Spencer, which, over the past couple of years, has embraced the mobile channel with real vigour, and is now reaping the rewards. It was the first UK retailer to launch a
fully transactional m-commerce site, and its opt-in mobile database currently has over 700,000 people on it, all of whom have given M&S permission to send them text messages with news, special offers and other updates. It has even used 2D barcodes on some of its packaging to en-able shoppers to access more information on their phone about the food they are buying. All this from a company that, up until a few years ago, didn’t even accept credit cards!
A couple of weeks ago, Tesco entered the fray with its latest mobile app, avail-able first on Ovi and now on iPhone, which enables users to do their Tesco shop via their mobile phone, or to amend or complete an order they started on their PC, and perhaps didn’t have time to finish before they left the house for work in the morning. The app, designed by Ribot, is more a shopping app than a Tesco app, and as someone who lives and breathes mobile, I find it hugely encour-aging that the UK’s biggest retailer is taking it so seriously.
Not surprisingly, there’s a lot of innova-tion in this area from smaller companies too. I particularly like HipSnip, which en-ables users to take memos of things they see and like and save them on their phone. HipSnip also enables users to sign up for offers from retailers they like. MePlease is taking a new look at SMS couponing, which is far from dead, and have had some great success stories with Pizza Ex-press and others. UK company Invitation Digital is also enjoying success with its
Vouchercloud iPhone app, which delivers targeted vouchers to users’ handsets. The app has been downloaded almost 800,000 times to date. Another firm, Geocast, of-fers targeted, location-based advertising on the mobile web. Companies can specify that they only want one of their ads served when a user comes within a given distance of one of their stores, or indeed, one of their competitor’s.
Both Vouchercloud and Geocast make it easy for their business partners to upload their offers or coupons and get them to users’ phones, and I think some of the companies trying to enter this space could learn from this. I’ve seen far too many examples where it seems the people behind apps and services like this seem one-step removed from the real world. They obviously know what the retail environment looks like from a shopper’s perspective, but they often don’t seem to have given sufficient thought to how their app or service is going to impact the retail environment and integrate with the retailer’s existing systems and processes. Or to how the staff working in store are going to react when presented with the mobile coupon.
Retailers are very keen on m-commerce and mobile marketing solutions, and so there is a great opportunity for mobile app and service developers here, so long as they put themselves in the retailer’s shoes and work through how their tech-nology solution is actually going to work in the retail environment. Get this right and the rewards could be huge.
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