People & Dreams

Archivo -noviembre 2012

Android app reviews move to Google+ ID system

Google has made it obligatory for Google+ account details to be displayed alongside new reviews of Android apps on its Play store.

Previously posts could be submitted anonymously.The move means the reviewer’s name and profile photo – if they have one – will appear alongside their entry. One developer said the change should help address the problem of fake reviews. It may also boost use of the search giant’s social network. When users attempt to post a review, they will be presented with a pop-up box notifying them of the new policy. The nicknames that used to appear alongside previous entries have all been deleted and replaced with «A Google User».

Facebook’s app centre already requires users to reveal their «real» Facebook identity alongside entries. But Apple, Microsoft, Blackberry and Amazon’s equivalents all allow reviewers to use pseudonyms. Google+’s terms and conditions state that profile names must match«the name your friends, family or co-workers usually call you».

Fake reviews

In October, Google announced there were more than 700,000 apps in its store.With so many to choose from, many consumers base their picks on whether the software has a high star rating and the number of people who have reviewed it. One industry watcher said this had given developers an incentive to «game» the results. «It’s very easy to have apps that have nothing but fake high-scoring reviews,» Mark Mulligan, editor of the Media Industry Blog, said,

«It’s only once many people have fallen victim to that and have added their real reviews that the tactic stops working. This is definitely a good move in solving the problem.» Ian Wharton, creative director of Zolmo – the firm behind Jamie Oliver’s 20 Minute Meals app – also welcomed Google’s change in policy.

Posts now identify the reviewer, while earlier ones simply say they were posted by A Google User. «We’ve seen companies release an app and then hundreds of their own employees end up rating them, which is a very disingenuous way to go about things.

«It’s a good thing that there’s now a face and a name. App stores are becoming so saturated with content that any effort to strip away falseness and make them more transparent can only make it easier to find good content.

«If Apple did something similar it could only make our life better.»

Social network support

The move may help the fortunes of Google’s social network, Android is the most commonly used smartphone system. Device owners had previously needed a Google Account to download apps from its store and use some of its other services – but this had not involved setting up a Google+ profile.

They now have an extra incentive to do so. It follows an earlier announcement that Google had decided to allow users to link their YouTube and Google+ profiles.

«Facebook is still clearly the dominant social network player, but Google+ does have momentum and there is plenty to suggest it could make up a lot of further ground,» said Mr Mulligan.

«One of the key tools Google has to its advantage is all the bits of its own ecosystem – it can promote the service by making it the glue that binds together all of its assets.»

He noted that this kind of move represented a growing trend, with another example being the way Microsoft had tied its Xbox Live product into its new Windows Phone 8 operating system via its Xbox Music Store.

However, companies need to be careful about the extent to which they cross-pollinate their offerings.

The EU is already carrying out an investigation into the Google’s placing of its services in its own search results, and reports suggest US watchdog the Federal Trade Commission is considering its own probe.Google has denied manipulating the results to favour its own products

Which Mobile Commerce Apps Won On Black Friday?

Mobile Ecommerce Traffic Up

Groupon maintained its spot as the top mobile commerce app, but Best Buy saw the biggest overall one-day gain on Black Friday, according to Onavo, a Sequoia-backed mobile data compression startup.

Usage of Best Buy and Walmart’s iOS apps jumped by more than fivefold last Friday and Thursday night. Following them were Kohl’s, Target and ShopSavvy. Onavo didn’t include Amazon in their study.

Onavo collected the data for their report through a sample of about 130,000 U.S. iPhone users last week. They’re an Israeli company that gets live insight into daily app usage through two consumer products: Onavo Extend, which helps consumers save on their mobile bills by compressing data usage and Onavo Count, which tells you how much data you’re using. Because they have millions of users, they can peek into daily mobile traffic to different apps.

Plus, because Onavo creates consumer-facing products and doesn’t work directly with developers, the company can publish data on active usage for specific apps. This is unlike mobile analytics companies like Flurry, which can’t really disclose performance of specific apps because developers would probably not work with them.

The apps with the overall highest usage last Friday were the group deals apps Groupon and LivingSocial, followed by Walmart, Target and eBay’s Red Laser.

Overall, comScore reported that U.S. retail e-commerce spending topped $1 billion for the first time this year. They said e-commerce spending jumped 26 percent from the year before to $1.042 billion. comScore said Amazon was the most popular e-commerce site by visits, followed by Walmart, Best Buy, Target, and Apple. eBay-owned PayPal also reported that Black Friday global mobile payments volume was up 193 percent from last year.

How Free Apps Can Make More Money Than Paid Apps

JOHN MANOOGIAN III
Sunday, August 26th, 2012

 

Editor’s note: John Manoogian III is co-founder and CTO at 140 Proof, a venture-backed startup for targeted Twitter advertising.

While building apps for Apple and Android app stores can be highly lucrative ventures for developers, one of the hardest decisions an app developer has to make is how to get the app to pay for itself. Often the “monetization strategy” — shorthand for “how will this app make money?” — is left for last.

It’s hard enough to get discovered by consumers among the millions of already existing apps, not to mention convince people to buy it. People increasingly prefer free, ad-supported apps for their tablets and smartphones, yet many developers still aren’t sure how to tackle the free vs. paid issue. Deciding when to charge for your app, and when to try an ad-supported model, is one of the hardest decisions developers must make.

Four Monetization Strategies for Apps? Actually, There Are Only Two.

Developers have several monetization options available, each with its own requirements and pitfalls.

Before moving forward with a strategy though, there are a few of questions an app developer should explore in order to answer the ultimate question, “how can I monetize my app?”

1. Is my app engaging enough for people to use it often?

2. How willing are people to pay an up-front fee for my app?

3. How do competitors in my space monetize their apps, and how successful are their strategies?

As app markets across platforms explode, developers are talking to each other to determine the best type of monetization model to use. Most will tell you it’s a choice among four major options:

1. selling your app in the app store

2. offering a free, subscription-supported app

3. offering a free app, with in-app purchases

4. offering a free, ad-supported app

But the choice really boils down to two strategies: getting paid by users or getting paid by advertisers.

Who Pays More for Apps: Users or Advertisers? (AKA Which Monetization Strategy Makes More Money: Free or Paid?

When it comes to users, the overwhelming majority of Android and iOS users resist paying — whether it’s for apps, subscriptions, or add-ons–so smartphone and tablet developers are particularly interested in experimenting with monetization through ads. On the other hand, advertisers are MUCH more willing to pay developers than users are. Just like developers, advertisers need to market their product.

How Much Money Can an App Make With Advertising?

Ad spending on apps of all kinds – both mobile and desktop — is growing. Most industry analysts choose to measure only mobile app spending though, as most apps are created for the mobile and smartphone space. Mobile advertising revenue increased nearly 1.5X in 2011, to top out at $1.6 billion for the year.

The future of app monetization clearly lies in ad-supported model. A recent study by Cambridge University computer scientists found that 73% of apps in the Android marketplace were free, and of those, 80% relied on advertising as their main business model. Free apps are also far more popular in terms of downloads, the researchers said. Just 20% of paid apps are downloaded more than 100 times and only 0.2% of paid apps are downloaded more than 10,000 times. On the flipside, 20% of free apps get 10,000 or more downloads.

The Best Part Is: You Can Deploy Multiple Monetization Strategies

While free apps reach the majority of users who tend to be price-sensitive and almost never buy apps, there is a subset of users who prefer to avoid advertising and seek paid (sometimes called “pro”) versions of their favorite apps.

Developers can cater to both types of users with a two-pronged approach to app development: create both a free version and a paid version. The multi-pronged approach is popular with big players in the publishing industry. For example, The Guardian (UK) is testing two apps: a free, ad-supported Android app and a paid-only iPhone app. Echofon is also a great example of an app that caters to both kinds of users. They have free and paid apps for all platform versions of their Twitter apps.

In short, before moving forward, investigate all ad-supported revenue options when you launch a new app. There are many ad networks available – shop around and see what CPMs (cost per thousand impressions) or CPCs (cost per click) they offer and how much work is involved integrating ads into your app.

And more than anything, make sure to consider any changes to the user experience that will occur if you introduce by the ads. After all, you want ads that integrate well into the user experience, rather than ads that drive users away in annoyance.

Understanding Your App’s Target Audience

The Audience Matters More Than the Idea

It’s easy to get excited about app ideas. I hear great ideas every day, but in most cases they’re ideas that originate around a task or function, rather than a specific audience. The target audience is considered as an after thought, only important when formulating the marketing plan. The more apps I design and launch, the more I’m convinced it’s better to start with a specific target audience and create ideas based on the needs of that audience.

Why Start With the Audience?

“But my idea is great! Even I need this app!” I’ve said this myself. I AM my audience, so why do I need to think about who I’m targeting with this app? Simply put, the “I am my target audience” methodology is flawed. Speaking from personal experience, if I had spent more time researching and polling my audience, I would have either brought some of the apps I’ve published to market much differently, or, in some cases, perhaps not at all.

A perfect example is our app, Doodle Bright. When the idea originated, the iPad had not even launched – I was using a wooden prototype to draw and test ideas. The problem is we identified our initial target audience as previous Lite Brite users, a novelty, retro app that adults who enjoyed the original toy would buy. Right, but mostly WRONG. Those people were buying the app, but they were buying it for their kids! If we had taken a week or two to poll the idea for the true target audience we would have very quickly narrowed down a very concise and targeted plan around:

  1. Pricing – What are parents expecting and willing to pay for an app that is fun, but not educational? Maybe the pricing should be less than an educational app.
  2. Upsell Opportunities – What is the value to parents? Does it keep the children entertained for 15 minutes or 15 seconds? If the value is high – perhaps they would be willing to make an in-app purchase to amp up the entertainment level even further.
  3. Design – Our original design was not targeted towards children. It was targeted for adults who got into the original toy. Once gameplay begins, the playful colors have eye catching appeal for a child, but if presented with a choice of our design versus a very kid-centric design, Doodle Bright would have a tough time competing.
  4. Interaction Design – The app was not designed specifically for a child’s mind. We did not do research on the most successful apps for kids before designing Doodle Bright. Not to say that the interface doesn’t work for kids, but we certainly made tweaks to the interface once we realized who made up the bulk of our audience.
  5. Marketing – We first market to the parent, but build the app for the kids. This is an insight we did not have during the “idea phase” because we started with the idea, not the audience. If we had taken extra steps to reveal the entirety of the audience, our marketing efforts would have been more successful. Instead, we marketed to adults in general, not parents.

Notice how knowing information about your audience touches many pieces of the product development? It doesn’t just impact marketing. It it a critical piece of the entire process.

How to Fine Tune Your Idea

If you’re reading this article, you probably already have an idea or perhaps have a client with an idea. You need to find out who is going to go crazy for your app idea. Or, even if you don’t have an idea, answering the following questions is a useful exercise to help you narrow down audiences that are a good target for mobile apps.

Does Your Audience Need an App?

Businesses with an existing customer base are the first to fall into the “we’ve gotta have an iPhone app!!” brouhaha. People want to “stay up with the technology” without considering if the product will bring value in the mobile context.

As an example, a company called me a few months ago that helps doctors offices generate more revenue by making phone calls to patients to remind them of appointments. Great, maybe they can make an app that reminds their patients of their appointment! Problem is, 99% of their patients do not own a smartphone. Which leads me to our next point.

Is Your Audience on iPhone?

You would think this is a no-brainer, but I’ve had dozens of calls from people with ideas like the above example. Think about how many ideas you’ve had or heard about that include an audience that simply isn’t on iPhone! I hear great ideas for apps all the time that are perfect for Blackberry users.

Does Your Audience Use Apps?

When I first began polling friends and family about the types of apps they use, I was surprised to learn how many “regular” people do not use a great quantity of apps. I then reflected on my own habits, which include testing apps for “work”, but for my own personal use revolve only around 3 – 4 apps! Do some asking around to make sure the people you have in mind to use your app are in the habit of using more than just the Mail and Phone applications!

Is Your Idea Mobile-Centric?

porting to mobile is a natural next step for growth of that product. Sometimes products are a good fit for mobile, but sometimes they aren’t.

For example, WebMD is in the process of porting their content to mobile. Is this the right move? Let’s think about their audience. People are at doctors offices waiting for appointments, a perfect time to surf their smart phone for more information on their health problem. In this case, the content is very mobile-centric.

Another example is a company that wanted to devise a lie detector test based on books they have written on the topic of deception detection. We sliced and diced the idea a million ways before deciding that there wasn’t a way to create a real, working lie detector for iPhone because using their methodology relied heavily on human evaluation of the subject.

Who is on iPhone?

Once you have narrowed down that your idea is mobile centric, and your users have iPhones and have needs, it’s time to learn more about their physical and emotional makeup and surroundings. Two components to research include demographic and psychographic information.

The iPhone Demographic

What is the iPhone demographic? It depends. Are you talking about iPhone and iPod touch or just iPhone? Generally speaking, iPod touch users skew younger than iPhone. You have kids whose parents buy the iPod touch for music and text messaging, before the child is old enough to own a phone. Do your research for the latest reports of iPhone to really understand who is using the device and how they are using it. Or, better yet, do some independent polling of your own on Twitter or with friends and family. The results might surprise you!

The iPhone Psychographic

Audience demographics are a common consideration defining a product’s target audience, but what about psychographics? Psychographic variables are any attributes relating to personality, values, attitudes, interests, or lifestyles. Although not “iPhone” specific, a study by Mindset Media found that Mac users are: superior, arrogant, open, perfectionists. Oye that hurts!

Seriously, it’s important to think about the emotional impact your app will have on its audience. Does it give a sense of relief because they don’t miss a plane? Or a sense of accomplishment by checking off an entire to-do task list? I’ll list out some brainstorming questions below that will help you identify some of the psychographic characteristics of your target audience.

Questions to Ask Yourself

The below list of questions will help you to fully explore the demographic and psychographic makeup of your audience.

  • Are they male/female?
  • How old are they?
  • Where do they live?
  • Do they have children?
  • Are they married?
  • Where are they when they use the app?
  • Do they love a competitive app? Why?
  • What do they do?
  • What do they have in common?
  • Why are they interested in the topic?
  • Who are they trying to impress?
  • Who impresses them?
  • What are their biggest fears?
  • What are their biggest hopes?
  • What Internet tools do they use most every day?
  • What Internet tools do they not use ever?
  • What drives my target to make decisions?
  • Can they afford my app?
  • Can I reach them with my app? Are they accessible?
  • Are there enough people in your target to be profitable?
  • How does your idea resonate with your audience on an emotional level?
  • Do you need to break your target up into niches?

Conclusion – Who Cares?

If you have only one takeaway from this article, it’s to ask yourself one question: “Who Cares?” Sounds a tad cynical, but a simple phrase to keep in the back of your mind during the app development process. Will anyone really care about this app? If the answer is yes – Godspeed!

Rackspace announces UK start-up programme for 2013

By Dave LeeTechnology reporter, BBC News

Start-up workers at London's Tech Hub
Blogger Robert Scoble likened the UK’s start-up scene to Silicon Valley’s early days

A major new programme to support fledgling technology start-ups in the UK is to be launched in the 2013.

Cloud hosting firm Rackspace is to offer £12,000 of hosting and mentoring for start-ups on the programme.

The launch comes as the government continued efforts to encourage successful UK start-ups to float on the stock exchange.

A survey of more than 50,000 entrepreneurs ranked London as the seventh best city to launch a start-up.

The report, by telecoms firm Telefonica, concluded that the UK’s offering was «no Silicon Valley» – due mainly to a lack of investment and what is perceived as a risk-averse investment culture.

But Rackspace, whose start-up programme has aided more than 850 US start-ups in their early stages, said they felt the timing was right to launch its push in the UK.

Speaking at Google’s Campus building in east London, technology blogger and Rackspace «evangelist» Robert Scoble drew parallels between London today and the early days of California’s famous Silicon Valley.

«If you go downstairs [at Google Campus] you can see dozens of start-ups working at tiny little tables,» he told the BBC.

«This feels a lot about how I saw Instagram for the first time – two guys sitting at a table coding like mad, two years later they’re worth a billion dollars. It has that feel to it.»

Rackspace is one of the world’s largest cloud hosting firms – second only to Amazon.

The cloud, as it is known, is a term given to storing data on servers in a variety of locations – rather than on a local machine.

Cloud hosting gives small companies flexibility when starting out. Rather than pay for the rental of dedicated servers, which can be expensive, it means start-ups can just pay for what they need.

‘Next Facebook’

In September, the government announced plans to loosen regulations surrounding companies that wanted to float on the stock market.

The move, which was backed by several of the country’s largest investment firms, would provide a «new route» to an initial public offering (IPO), universities minister David Willetts said.

A successful British IPO would be seen as a major success for the government’s Tech City initiative – an organisation designed to promote the interests of UK-based start-ups globally.

Companies tipped to be likely IPO candidates in the new year include Mind Candy – creators of children’s social network Moshi Monsters – and online loans company Wonga.

Mr Scoble said the key to a successful flotation was in the timing – and that chasing the «next Facebook» may not be the right move.

«Some of it is luck,» he told the BBC.

«Some of it is about being at the right market window at the right time. Right now it’s a really tough market window.

«In Silicon Valley the venture capitalists are telling me they’re moving investment away from consumer and into enterprise because they’re seeing that the consumer markets are too risky.

«They’re investing less in consumer kinds of things – they’re trying to get the kids to focus on the enterprise market.»

The Mobile Advertising Ecosystem Explained

Alex Cocotas Oct. 22, 2:19 PM
mobile ad forecas

We are in the post-PC era, and soon billions of consumers will be carrying around Internet-connected mobile devices for up to 16 hours a day.

Mobile audiences have exploded as a result.

According to the U.K.’s Association of Online Publishers, mobile accounts for at least 20 percent of traffic for 87 percent of publishers.

It follows then that mobile advertising should be a bonanza, similar to online advertising a decade ago. However, it has been a bit slow off the ground, and its growth trajectory is not clear cut.

That said, U.S. mobile ad revenue was $1.2 billion last year, according to the IAB, and is on track to hit $3.2 billion this year.

In this report, we attempt to demystify the mobile ad industry’s many moving parts.

Here’s what we learned:

  • The mobile ad ecosystem is fractured and more complex than its desktop counterpart.
  • Mobile ad networks occupy a central position in the ecosystem, but are coming under threat.
  • Demand side platforms and mobile ad exchanges are streamlining the market.
  • Real-time bidding will play a growing role.
  • Agencies are coming around on mobile, but major brands still haven’t fully caught on.
  • New companies are emerging that hope to upend the traditional banner ad.

The Mobile Ad Ecosystem

2011 global mobile ad spend

The mobile ad ecosystem is not as strictly delineated as the desktop ecosystem.

«The cake is smaller on mobile,» says Krishna Subramanian, chief marketing officer of mobile advertising and marketing firm Velti. «[Companies] will try to do multiple things to see what gains traction.»

Another factor adding to complexity is the multiple industry layers advertisers must sift through.

In mobile advertising, the rules of the road change with different combinations of device, wireless operator, and operating system. There are few shared protocols and standards, so mobile lacks the technical consensus that enables ad targeting, delivery, and measurement to work fairly seamlessly across the desktop world.

mobile ad format

As the mobile ad industry matures it will likely become more streamlined and simple, but for now there are innumerable actors interacting with one another and attempting to find a niche.

Google does utterly dominate the paid search category, which was responsible for 62 percent of mobile global ad spend last year. In this report, we focus on the display ad category, which isn’t nearly as consolidated and thus presents a more complicated picture.

Mobile Ad Networks

Mobile ad networks aggregate advertising inventory and match it with advertisers, much as online ad networks do.

Millennial Media

Google’s mobile ad network, AdMob, is the largest player in this business. Millennial Media was the first pure-play mobile ad network to go public (read their prospectus here).

Networks soak up ad inventory, analyze its potential, and sell it by matching it to advertisers’ needs.

«Ad networks play an important role in mobile [because the] audience is fragmented across a large number of devices and publishers,» says Michael Collins, CEO of mobile ad agency Joule. «The role of the network is that they are able to aggregate audience at scale. There are many [networks] all at different stages of their evolution, some stronger and more robust, but still a good amount of innovation is going on in the market.»

The open secret, according to Collins, is that «networks all have the same inventory,» which they buy from wholesalers aggregating publisher supply.

Subramanian, CMO at Velti, echoes this sentiment: «If you are running on three ad networks, you could effectively be bidding against [yourself]» for inventory and impressions.

Where networks differentiate is in value-added services, such as aggregating buying power to strike better deals, or improve targeting.

The largest ad networks have their own sales forces reaching out to advertisers, as well as their own campaign optimization technology.

«Our belief is that the number one thing you have to do is understand the audience better than anyone else,» says George Bell, CEO of mobile ad network Jumptap. «That’s value-add between the publisher and the advertiser.”

Several people we talked to mentioned that mobile ad networks face challenges as the mobile ad market matures and scales.

Victor Milligan, chief marketing officer at Nexage, says networks’ dependency on direct sales «is not going to grow with the market,» but will remain part of the ecosystem. He notes some ad networks are starting to embrace online real-time bidding (as ad exchanges already have done; see below) in order to sell ad inventory at the larger scale enabled by automation.

Demand Side Platforms

Mobile ad networks also face pressure from demand-side platforms (DSPs) like StrikeAd. These function similarly to ad networks, in the sense that they help match advertisers with inventory, but tend to work hand-in-glove with brands.

“Demand-side platforms give media buyers a platform providing visibility into ad inventory, letting them optimize campaigns on a real-time basis and buy into real-time inventory cross-publisher,» Collins of Joule was quoted as saying in an interview with Mobile Marketer. «In some ways, it is an evolution of an ad network model.»

In plain English, DSPs give advertisers deeper insights into mobile audiences in a real-time environment.

Bell, of Jumptap, says DSPs are complementary to the ad network business because they more richly describe mobile audiences.

But once DSPs start hiring their own staff to sell ad inventory, the complementarity could end, and DSPs would compete more head-on with ad networks. In case you were wondering, StrikeAd is currently hiring account executives.

Mobile Ad Exchanges

Exchanges automate many parts of the mobile ad process, and can connect publishers with multiple ad networks.

Ad exchanges are primarily supply-facing at the moment, and have relatively few interactions with mobile ad agencies (even less so with brands). Agencies are disincentivized from using exchanges because they threaten their lucrative role as the brands’ media buyers, according to Bell, Jumptap’s CEO.

If exchanges gain a certain level of scale, like Google did in online advertising, brand money could start to directly flow into their businesses, and that would threaten agencies’ media buy margins.

But Bell thinks that the «people spending the money have ambivalence about whether algorithms should be in control of [media buying].»

From publishers’ perspective, the main advantage of exchanges is their efficiency. Generally speaking, they provide greater price transparency, scalability, and liquidity.

It is important to note that mobile ad networks and exchanges aren’t playing a zero sum game. The rise of one doesn’t necessarily preclude the other’s existence. For example, exchanges sometimes act as «aggregators» of publisher inventory, which they then wholesale on to the networks, according to Collins of Joule. That’s why many ad networks have the same inventory.

Bell thinks that exchanges will phase out the prevalence of software development kits (SDKs), which have been the focus of the mobile ad industry for the past three to four years. The SDKs are lines of code that developers and publishers drop into their apps in order to plug into ad networks’ systems.

Large mobile ad networks, like Millennial Media, have garnered large install bases for their SDKs. However, if publishers want to pit multiple ad networks against each other, they need to install multiple SDKs. Additionally, many publishers opt to include the SDK of an independent app analytics company, like Flurry. Supporting multiple SDKs can quickly become an engineering headache.

Exchanges can vastly simplify this process by offering a single SDK. Through an exchange’s SDK, publishers are able to offer ad impressions to multiple networks simultaneously. Bell’s hope is that this streamlined process will convince developers not to view the mobile ad ecosystem as cumbersome.

There are two types of formats for exchanges, often working in tandem: mediation and real-time bidding (RTB).

Mobile advertising mediation combines human and technical considerations. The publisher and the exchange work together to tweak goals and set the framework for how ads are placed on their site.

For example, they can set parameters by price, ad format, number of ads, location, what kind of advertiser they want, etc. They can parse out a certain percentage of impressions to various networks, block off inventory for their own promotions, or auction impressions on a sequential basis, where the high bidder gets first crack at the next impression.

Velti’s mobile ad exchange, brought over with the Mobclix acquisition, is an example of an exchange that uses mediation to work with publishers and developers (it also has a real-time bidding platform).

Velti gives clients an SDK they drop into their apps, which connects them into analytics and plugs them into 60 ad networks. Currently, over 35,000 apps use the SDK.

Nexage is an example of a real-time bidding (RTB) mobile ad exchange. RTB allows market participants to instantaneously bid on individual impressions targeted by location, platform, device, or other criteria. Milligan, CMO at Nexage, says there can be as many as 500 million auctions per day on Nexage’s exchange.

Jumptap’s Bell says real-time bidding — also called algorithmic buying — will rush into mobile at some point, but it is still reasonably small. He estimates that it is currently no greater than five or 10 percent of the bidded mobile advertising market, but added he wouldn’t be surprised if it grew to 30 percent or more in a few years time.

Mobile Ad Agencies and Mobile Marketing

One of the gripes you often hear around the mobile ad industry is that agencies don’t get it. According to the U.K.’s Association of Online Publishers, 55 percent of publishers blamed «agencies’ attitude» for low mobile ad revenues.

However, that is changing. Several people we talked to said agencies are doubling down on mobile, and competency is improving.

For example, Joule, a subsidiary of WPP, is a full-service mobile marketing and ad agency. Other mobile ad agencies include Airwave (an OMD subsidiary), and Mobext.

Joule CEO Collins says the world’s largest advertisers have only just made the transition to online advertising and now face a new medium with its own quirks and challenges.

Consequently, there are «still a large percentage of brands … that don’t have the mobile destinations — either a site or application — that they can use to engage users in the mobile space.»

The basic difference between mobile advertising and mobile marketing is pretty straightforward.

«Mobile advertising,» Krishna Subramanian, Velti CMO told us, «is everything happens before the click. Mobile marketing is everything after the click.»

Mobile advertising is the process that gets the ad before a consumer’s eyeballs. Mobile marketing is the more long-term process of driving value from mobile customers, which can include loyalty rewards or contests. The two are irrevocably interlinked and there are a number of companies that straddle the fence.

Subramanian says 80 percent of Velti’s revenues come from mobile marketing.

The Natives

smartphone receptivity

Other companies are emerging that don’t neatly fit the established categories. They resemble ad networks in that they connect advertisers with publishers’ inventory, but they express disdain for the traditional mobile advertising model.

Chris Cunningham, co-founder and CEO of adtivity by appssavvy, says mobile ad networks are «focused on spraying users» and «took the same approach as with the Web, which is focused on banners.»

Such criticisms feed skeptics’ perception that mobile ads are ineffective and that consumers find them intrusive.

Skeptics may have a point. According to Nielsen, only 19 percent of U.S. smartphone owners thought mobile advertising was acceptable and another 16 percent don’t mind it as long as it’s not intrusive.

Some ad companies are trying to find a native approach to mobile advertising that will break through consumers’ apparent disdain for mobile ads. For lack of a better term, we have grouped them as «the natives.»

Adtivity by appssavvy is focused on delivering relevant ads during natural breaks in consumer’s mobile content consumption. For example, they ran a Coca-Cola campaign tied to «giving happiness.» When a consumer shared a piece of content from one of the publishers, they were shown an ad tied to the theme.

Cunningham wants fewer ads, but to make them front and center during these breaks rather than relying on the status quo of placing mobile ads adjacent to content.

SessionM induces consumers to opt-in to rich media ads. Consumers are rewarded for reaching certain milestones on a publisher’s app or website with «mpoints,» which can be redeemed for gift certificates and other goods. Consumers earn more points the more they interact with sponsors’ rich media ads, typically video-based, mini-games, or social polls.

«Digital consumers switch screens 27 times in an hour,» says Lars Albright, CEO of SessionM. «You have to think of ways that you can capture their attention.»

Albright says between 75 and 85 percent of consumers opt-in to SessionM ads.

There are also major publishers pursuing interesting mobile advertising strategies, such as Pandora, Twitter, and Facebook. As we discussed in our Future Of Mobile Ads presentation, Pandora mixes display, audio, and video ads, which now account for two-thirds of its ad revenue. Twitter and Facebook have opted for sponsored stories, which are ads that are integrated seamlessly into a user’s feed. Twitter’s mobile revenues now shoot past the traditional web’s on many days. Facebook was taking in $500,000 a day in mobile ads only a few weeks after their introduction.

However, it should also be pointed out that the vast majority of publishers don’t have nearly the scale or size to pursue these sort of strategies on their own.

THE BOTTOM LINE

  • Mobile ad networks are being squeezed by ad exchanges and DSPs (demand-side platforms), but can maintain their central position if they keep an edge in audience targeting and measurement.
  • Many brands lack the mobile destinations necessary for an effective mobile ad campaign.
  • Mobile marketing can produce as much or more revenue for agencies as mobile advertising alone.
  • Mobile native ad formats are finding success with TV-style content break ads, and opt-in reward schemes.
  • Only the largest publishers have the size and scale to go it alone in mobile advertising.

Click here to download a PDF version of this report→

Manufacturers Shipped Twice As Many Smartphones As PCs Last Quarter

By Marcelo Ballvé

We’ve reached another milestone in the growth of the smartphone market. Hardware makers shipped twice as many smartphones as PCs in the third quarter of this year, according to BI Intelligence estimates compiled from multiple sources.

It’s the first time the quarterly data shows global smartphone sales outstripping PC sales by a ratio of two-to-one. In all, 169.1 million smartphones shipped, compared to 87.7 million PCs. Smartphone growth first took off in 2009, and continues to be robust.

Smartphone shipments grew 10 percent in the third quarter, compared to the previous quarter. Tablet shipments also notched impressive gains, growing 5 percent in the quarter and accounting for 27.7 million units shipped.

Click here to download all the data associated with this chart in Excel→

BII_Tablets_GrowthQ312

Mobile payments to exceed $1 trillion by 2017 – IDC

14 NOVEMBER 2012

Spending on goods and services using mobile devices will exceed $1 trillion by 2017, driven by m-commerce and NFC payments, market watcher IDC said

According to IDC Financial Insight’s Worldwide Mobile Payments 2012-2017 report, which presents a worldwide forecast of consumer and business spending through mobile networks over the next five years, worldwide purchase volume over mobile devices will surpass $1 trillion by 2017.

The report includes purchases of digital and physical products and services, as well as direct fund transfers that do not involve the exchange of any product or service.

Most of the purchase volume will come from mobile commerce, IDC said, which includes purchase of digital media on the device as well as e-commerce through a mobile web browser.

Proximity payments, which are made by waving a mobile phone with Near Field Communication (NFC) technology near a merchant’s point-of-sale (POS) terminal, will ride upgrades in POS and mobile device technology to become the second-largest category of mobile payment spending, IDC said.

Person-to-person (P2P) fund transfers will come third, IDC said, limited by a lack of common standards for sending money across borders using mobile devices.

In addition, P2P fund transfers could suffer from a lack of locations for adding to and withdrawing cash from the system, it said.

While its forecast for mobile payments in 2017 is large in dollar terms, IDC said it is a tiny fraction (just above 2.5%) of the total amount of worldwide commerce that is theoretically addressable by mobile payments.

«The growing prevalence of smartphones is enabling a variety of mobile payment methods, which combined are becoming a significant share of global commerce,» said Aaron McPherson, practice director of Worldwide Payment Strategies at IDC Financial Insights. «We expect growth rates to continue to accelerate as consumers and retailers become more comfortable with the technology.”

In driving the growth of mobile payments, IDC says financial institutions should view them as an opportunity to leverage the information they possess on their customers’ shopping habits and demographic characteristics.

This could include financial institutions implementing targeted marketing and reward programmes as a supplement to regular loyalty programmes, IDC said, in addition to incorporating their cards into NFC and mobile wallets to capitalise on the growth of m-commerce and NFC proximity payments.

8 Ways to Integrate Mobile Into Your Marketing Strategy

Question: What’s one creative idea for marketing your business on mobile platforms?

Ashley

Advertise in the Top Apps

“What types of mobile games does your target market play? What types of apps do they use? Once you identify these elements, create eye-catching interactive advertisements that play off of and refer to their interest in that game or app.”

Logan Lenz | Founder / President, Endagon

The Extra Checkbox

“Advertising platforms like StumbleUpon and Google AdWords are affordable for small businesses and allow you to opt-in to mobile ads simply by checking a box. It’s really no extra work for you and allows you to reach a larger audience.”

Natalie MacNeil | Emmy Award Winning Producer & Entrepreneur, She Takes on the World

Create the Campaign

“We’ve recently separated our campaigns on Adwords with separate campaigns for smartphones and tablets, and have seen a significantly boost in ROI.”

Josh Weiss | Founder and President, Bluegala

Use QR Codes

“I have had great success combining physical flyers with QR codes which drive traffic to mobile-friendly landing pages or solicit mobile-friendly actions. Use a QR code plus Clicktotweet.com to generate an instant tweet from someone holding your flyer. This works great with Facebook Check-ins and Likes as well. Get creative with where your QR code goes!”

Lucas Sommer | Founder CEO, Audimated

Step Away From the App!

“Don’t create an app that no one is going to download or use. Instead, create app-like mobile websites. These give you more flexibility, and they allow for additional functionality. Better yet, users like the fact that they don’t have to pay exorbitant fees or download software that eats up space.”

Brent Beshore | Owner/CEO, AdVentures

Set the Scavenger Hunt

“Encourage users to follow your brand on Foursquare and use check-in notes and venue tips to create a city-wide scavenger hunt in your key market. You’ll engage your customers by creating a remarkable and rewarding experience and you’ll also gain clout with stores and venues by delivering them new foot traffic. “

David Gardner | Co-Founder, ColorJar

Mobile Networking Works

“I often find that the more I share of myself online, the more interaction I get and therefore the more relationships I build. By being present on engaging mobile apps (Path, Foursquare, Instagram, etc.) I get to create relationships with people that I share similar interests with outside of work. Then, I have the ability to potentially talk business with someone that I already know I like!”

Erin Blaskie | CEO, BSETC

The Mobile Map

“Mobile marketing offers the potential to reach a huge audience. Who doesn’t have a cell phone these days? Make sure to include your company’s address in whatever type of mobile campaign you decide on. People using cell phones are on the move and you want to be able to direct them right to you.”

John Hall | CEO, Digital Talent Agents

The Young Entrepreneur Council (YEC) is an invite-only nonprofit organization comprised of the world’s most promising young entrepreneurs. In partnership with Citi, the YEC recently launched #StartupLab, a free virtual mentorship program that helps millions of entrepreneurs start and grow businesses via live video chats, an expert content library and email lessons.

2 Quick and Easy Local and Mobile Holiday Marketing Ideas


If you want to attract more shoppers to your store this holiday season, then I’ve got 2 holiday marketing ideas for you.

That’s right, my friends at Pitney Bowes asked me to create two videos to help small businesses implement local marketing strategies this holiday season and I’m going to share them with you below.

The good news is that both of these holiday marketing ideas can be put into action quickly and easily, making them viable tactics for this year’s holiday season.

Both ideas focus on mobile marketing which is handy because the use of mobile devices while shopping continues to be astrongly growing trend.

And, if you’re worried that it’s too late to implement new marketing strategies for this holiday season, the good news is that both of these holiday marketing ideas can be put into action quickly and easily, making them viable tactics for this year’s holiday season.

So grab the eggnog and watch the two videos below. Both reveal step-by-step actions for you to take to increase both your traffic and sales this holiday season.

Build and Market a Stand-Alone Mobile Website

This year, there’s a great holiday marketing tool to add to your arsenal and it’s called a mobile website.

Why build a mobile website? Here are some great reasons:

  • Two out of three Americans have the ability to browse the Internet while away from their home which means that they can make buying decisions and look for places to shop while on the go;
  • 39% of mobile users use their device to send messages to a business to get more information and you do not want to miss the opportunity to receive those messages; and
  • A whopping 84% of surveyed small businesses with a stand-alone mobile website have seen an increase in new business as a result.

The step-by-step video below will help you get your mobile site up-and-running for this holiday season.

Note: for best results, view the video full-screen by clicking the two outward-facing arrows below the video and to the right after clicking the play button.

[vimeo http://www.vimeo.com/53638709 w=500&h=281]

Tool used: pbSmart™ Mobile

The 12 Days of Christmas – A QR Code Marketing Plan

What can you do to get customers to pay attention to you this holiday season and visit your store to buy presents? Here’s a useful idea that uses QR codes.

Using an app on a smart phone, a QR code is scanned by the camera and can take you to a mobile site with a coupon for your store. Using QR codes, I’m going to show you how to run a very specific type of marketing campaign called, “The 12 Days of Christmas – A QR Code Marketing Plan”.

Note: for best results, view the video full-screen by clicking the two outward-facing arrows below the video and to the right after clicking the play button.

[vimeo http://www.vimeo.com/53103921 w=500&h=281]