Greg SterlingOpus Research/Sterling Market Intelligence
November 13, 2012
Ten Big Trends in Ten Short Minutes
• Hype-Local: Demand, Awareness Growing
• Mobile Momentum Continues
• Social Media, SMBs & the ‘Now What?’ Problem
• Local Data Tsunami
• Payments and Real-World Analytics
• From Clicks to Local Transactions
Last Year: LSS ‘11
• Continued momentum of mobile and “decline” of the PC
• Growth of tablets (and emergence of smaller tablets)
• Rise of multi-screen consumer
• Mobile shopping and ‘showrooming’
• Mobile payments – not quite there yet
• Bursting of the deals “bubble”
• Decline of Facebook?
• Fragmentation of search, growth of apps and “assistants”
• Slow merchant response (brands, SMBs) to consumer changes
• SMB confusion amid market complexity
• Novel uses for location data (proxy for audiences)
• Indoor location, “turn by turn” directions
• Coming of the “Zombie Apocalypse”
This Year: LSS ‘12
Shift from PC Mobile
Source: IPSOS, Google, ROA Holdings (2011-2012)
Smartphone Penetration Passing 50%
Source: ITU World Telecommunication/ICT Indicators database, Gartner, Morgan Stanley (2011-2012)
Mobile phones (overall)
Smartphones PCs0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
Mobile vs. PC Penetration (Q4 2011)
Mill
ion
sGlobal Mobile Penetration
• Total mobile subscribers: between 237-250 million
• Smartphones: 125 million approx
• Current smartphone penetration: 55%, moving to 62% by Q4/Q1 2013
• Pew: 68% with incomes $75K+ have smartphones today
Source: StatCounter, November 2012
Traffic: Mobile vs. PC
2011-10
2011-11
2011-12
2012-01
2012-02
2012-03
2012-04
2012-05
2012-06
2012-07
2012-08
2012-09
2012-10
0
10
20
30
40
50
60
70
80
90
100
Desktop Mobile
• Globally: Mobile 12.3% of global web traffic
• Europe: 6.5% is mobile
Source: StatCounter, October 2012
Mobile vs. PC in India
2009-10
2009-12
2010-02
2010-04
2010-06
2010-08
2010-10
2010-12
2011-02
2011-04
2011-06
2011-08
2011-10
2011-12
2012-02
2012-04
2012-06
2012-08
2012-10
0
10
20
30
40
50
60
70
80
90
100
Desktop Mobile
Apple: 100 Million iPads Sold
• 100 million iPads sold since launch 2.5 years ago• 91% of tablet-generated web traffic comes from the iPad• 94% of the Fortune 500 is testing or using the iPad
Microsoft Attempting to Adapt
Microsoft CEO Steve Ballmer: sales “starting modestly."
Rise of Multi-Screen User
• 90% use screens sequentially to accomplish a task; majority of that activity happens the
same day
• Different “start screens” for different types of activities
• Nearly impossible to track
Source: Google-IPSOS (August, 2012), n= 1,455.
Same Day ‘Sequential Screen Usage’
22%63%
15% 82%
77%
66%
45%
28%
9%
13% 10%
15%
19%
16% 39%
14%
9%
Source: IAB, 5/12 “mobile shopping diaries,” n=260
64%
36%
Yes No
Where you using/looking at any other media at the same time [when using smartphone]?
Simultaneous Media Usage
Source: Google-IPSOS (August, 2012), n= 1,611
Context, Need, Time Impact Device Use
Source: Google-Ipsos Q1, 2012 n=1,000 US smartphone owners
Top 3 locations:
1. Home2. On the go3. In store
IAB “mobile diaries” study:
1. At home: 47%2. Out and about: 29%3. At work: 10%
At home
On the go
In a store
Restaurant
Work
Social gathering
Dr.'s office
Café
Airport
On public trans.
School
97%
83%
78%
71%
71%
60%
56%
50%
49%
36%
30% AdMob survey (3/11): 82% of tablets used primarily at home
Smartphones Used Extensively at Home
Mobile Shopping (not buying) & ‘Showrooming’
Mobile Comparison Shopping
• Multiple studies: 60% to 80% (approx) of consumers use mobile devices in stores
• Google research: 70% of smartphone owners use them in stores
- What are they doing? Smartphone owners do price comparisons, check product reviews and locate stores
After consulting their smartphones:
• 37% decided to not purchase the product at all
• 35% purchased the product at that store
• 19% purchased the product online
• 8% purchased the product at another store
Source: Pew Research Center (Q1, 2012), n=1,000 US mobile phone owners, Google, InsightExpress surveys 2011
64% of in-store smartphone users decided not to buy on the spot
Restaurant Travel Automotive Restaurant Travel Automotive
84%
43% 49%
85%
48% 52%
16%
57% 51%
15%
52% 48%
Yes NoMade a Purchase Related to Visit on App/Website by Device
Smartphone Tablet
Half of Mobile Lookups Lead to Purchase
Source: xAd-Telmetrics “mobile path to purchase” study conducted by Nielsen (Q2 2012), n=1,500 survey respondents and behavior observed from 6,000 Apple and Android users
M-Commerce Penetration (US)
Source: UC Berkeley School of Law (July 2012), n=1,119
Q: Which of the following do you use your phone for?
Voice calls
Messaging
Playing Games
Accessing internet
Access social networks
Making purchases
Listening to music
Location services/maps
Taking pictures/video
89%
85%
52%
35%
56%
42%
20%
41%
46%
75%
11%
15%
48%
65%
44%
57%
80%
59%
54%
25%
NoYes
Source: Google-Ipsos Q1 2012, n=1,000
• 65% of smartphone owners would prefer to use a PC/laptop for transactions
• 37% researched but later purchased online
• 32% researched and later purchased offline
Mobile-Influenced Purchases: Offline, PC
Mobile Payments
Mobile Payments Are Sort of Here
• Lots of anticipation for mobile commerce and mobile payments
• Mainstream adoption not there
• PayPal has a plastic card
• Google about to introduce one
• Getting from here to there: time frame, device replacement, POS upgrades?
Interest M-Payments (US)
Compare prices when shopping
Receive offers/promotions based on location
Track finances daily
receive and manage coupons
Buy things at in-store POS
As a membership card
As a photo ID
Purcahse tickets to events
Organize and track gift/loyalty cards and programs
As ticket for bus
As house key
Refused to answer
48%
33%
31%
31%
25%
24%
23%
23%
21%
19%
18%
18%
Source: US Federal Reserve (3/12) n=2,002 US adults
Q: Would you like to use your mobile phone for any of the following purposes?
Main Reasons for Not Using M-Payments
Concerned about security
See no benefit from using mobile payments
Easier to pay with cash or credit card
My phone doesn't have necessary feature(s)
Don't trust the technology to process payments
Cost of mobile data too high
Other
Difficult/time consuming to set up
Unaware of stores that accept mobile payments
Not offered by bank/credit union
Refused to state
42%
37%
36%
31%
20%
15%
12%
9%
9%
4%
2%
Consumers express lack of trust, fear and confusion about mobile payments. They also don’t yet see the benefits.
Q: What are the main reasons why you have not used mobile payments?
Source: US Federal Reserve (3/12) n=1,780 US adults
Decline of Facebook?
• Facebook announced 1 billion users globally (October)
• 600MM mobile users
• 17 billion location-tagged posts, including check-ins
• Median age of the user is about 22
• However engagement declining?
- September 2012: 6 hrs 40 minutes (US)
- March 2012: 7 hrs 9 minutes
• Rise of alternatives
Facebook: 1 Billion Users . . . But
Source: Facebook internal data, Nielsen (November 2012)
• 12.8 million local businesses have Facebook pages
• 8 million of them monthly updates
• 3.5 million update weekly
Local Businesses Souring on Facebook?
Source: Facebook internal data (Q3 2012); Reply.com, September 2012 (n=3,270 US SMBs under 99 employees); Manta September 2012, n=614 US SMBs
Does your business have a presence on Facebook?
• Yes, and I find it valuable — 42%
• Yes, but I don’t find it valuable — 30%
• I used to, but didn’t feel it was worth it — 5%
• No — 23%
58% had negative view
Evolution of Search, Rise of ‘Assistants’ in Mobile
Mobile Search Is Almost All Google
66% of mobile users find mobile sites through search engines
Source: Google-sponsored study with 1,088 US adults (25-54); survey/interviews conducted Q3 2012; StatCounter, September 2012.
US Market
• Google: 93.8%
• Yahoo: 3.89%
• Bing: 1.48%
• Others: 0.83%
Global
• Google: 97.1%
• Yahoo: 1.88%
• Bing: 0.65%
• Others: 0.37%
• Android now leading smartphone OS globally
• In US Android has 52% of US smartphone market (comScore)
Google Maps
Yahoo
Mapquest
Bing
YellowBook
YPMobile
Yelp
SuperPages.com
Citysearch
Urban Spoon
Other
64%
52%
39%
38%
38%
36%
31%
28%
24%
23%
3%
Most popular local search apps (among the 49%)
2011
49%
Use of apps for local search on smart-
phones and tablets
Half of mobile users conduct local searches with apps (volume unclear)
Source: comScore-Localeze-15Miles Local Search Study, Q1 2012, n=4,000
Mobile App Use for Local Search
Source: Nielsen (May 2012)
ComScore: “4 in every 5 mobile media minutes” is spent with apps (vs. browser)
Series10%
10%
20%
30%
40%
50%
60%
70%
80%
90%
72%
81%
28%
19%
Apps Mobile web
Time Spent in Mobile: Apps Dominate
May 2011 May 2012
Assistant Metaphor Taking Hold
Merchants Slow to Respond
Source: Google-IPSOS (August, 2012), n= 1,611
Screen Time: 90% of Media Interactions
90% of media Interactions are through one of four screens10% of media time with traditional channels
MINUTESMINUTES
66MINUTES
74MINUTES
81MINUTES
64MINUTES
43
Sources: Mary Meeker, KPCB “Internet Trends” presentation May 2012, Flurry Analytics
US mobile ad revs (IAB 2011) approx $1.7B
Time Spent with Mobile vs. Ad Spend
• Mobile-friendly sites produce 75% higher rate of engagement (revenue, page views, etc.) per visit for mobile users*
• 55% of consumer survey respondents said a frustrating mobile experience hurts opinion of the brand*
• Roughly 80% - 90% of Fortune 500 don’t have mobile-optimized site**
• 79% of large online retailers don’t either***
*Google: Jason Spero (ThinkMobile event 2011), Google, Sterling Research 9/12 (US consumer survey; n=1,088) **iMomentus, August 2012***Magento (Q2 2012)
I’m disappointed
in you
Most Marketers Still Not Mobile-Ready
Is This a Good Ad?
What about This?
New Uses for Location Data
Location As ‘Context,’ Proxy for Audience
Skyhook Wireless, Factual, PlaceIQ, Placed, JiWire and others using location profiling to enable brands and marketers to target audiences
Mapping the Great Indoors
Indoor Location, Turn-by-Turn
Range of companies:
• Bing
• Nokia
• Micello
• Meridian
• Point Inside
• Aisle411
• Wifarer
• Others