Last week ShopKick introduced "shopBeacon," which uses Bluetooth low energy (BLE) indoor positioning technology. The company is testing it with Macy's, which has also independently been using indoor location for some time (mainly leveraging WiFi) to enhance its in-store app experience for customers. (See ShopKick demo video.)
ShopKick's adoption of iBeacon is an important move to insert the company back into the in-store shopping conversation. It had been an early pioneer in mobile loyalty, seeking to help retailers drive consumers into stores. But as indoor location has gained momentum ShopKick has largely been on the sidelines -- until now.
ShopKick has a wide range of brands and national retail partners, including Target, BestBuy, Sports Authority and JCPenneys. The company seeks to serve retailers but also "own the customer relationship." Accordingly there's some tension between working with ShopKick and providing a direct indoor-location experience, as Macy's does through its app.
A less-well-known company seeking to do something very similar for retailers is Swirl. Swirl has both a consumer-facing multi-retailer app but also powers the indoor experience for retailer apps through an SDK. Timberland is the company's best-known partner. ShopKick is now also an indoor-location enabler with its shopBeacon BLE beacons.
Apple itself is going to implement iBeacon in its own stores. There are a range of obvious and secondary use cases, including providing enhanced product information and notifications about Genius Bar appointments. Beyond an improved in-store experience, Apple hopes to boost sales through iBeacon. The product can also be used to support in-store mobile payments (see, PayPal Beacon).
It's well established that a majority of consumers have used smartphones in store for research purposes and many are interested in indoor/in-store information. However recent research from ISACA suggests that retailers will need to be judicious about how they use in-store notifications and personalization and not become too "pushy" in trying to upsell and cross-sell consumers.
Another challenge of sorts for retailers with indoor location is the fact that majorities of smartphone shoppers use retailer mobile websites. Indoor-location features are much harder to deliver via websites. Smaller numbers of consumers use retailer apps. This makes sense because apps are typically downloaded and used by a store's most loyal customers, which represent a minority of overall store shoppers.
According to NPD survey data, 71% of smartphone owners access retail websites but only 57% use apps. Many of those apps fall into disuse shortly after they're downloaded. In addition, the survey found that a majority of smartphone shopping-related research was done at home and not on the go, suggesting "that engagement on their smartphone is more of an alternative for online shopping rather than a showrooming tool."
Accordingly in-store information directed at enhancing the customer experience is a way to make apps more relevant and engaging. But as the ISACA study indicates retailers (or mall and venue owners) will need to develop information, content and indoor experiences for customers that are informational and not merely about trying to sell things.
This is a complicated arena for retailers and would-be providers of indoor location and marketing. Experimentation and testing are necessary to determine what's going to "work" for consumers, vendors and venue owners. Macy's is very smart and to be applauded for "getting out in front" of the issue and trying things, notwithstanding the potential exposure to "indoor surveillance" criticisms.
Google is the world's largest mobile advertising company. However after Google there are only a few big players on a US or global basis. Google doesn't disclose mobile revenues as a separate line item.
According to the IAB, US mobile ad revenues in the first half of 2013 were roughly $3 billion. That means we can probably expect between $6.5 and $6.8 billion for the full year 2013.
Online just 10 companies accounted for 70% of total online ad revenue in Q2 2013. In mobile, ad revenues are even more concentrated in a smaller group of companies.
Google's mobile revenues are probably, conservatively, in the range of 15% of its total ad revenue, which will come in around $49 or $50 billion globally for the full year. Let's also assume that roughly 50% of Google's mobile revenue comes from the US market. That would all mean Google would have about $3.6 billion in US mobile ad revenue this year. It could be more, however.
Facebook, Twitter and Pandora all report the portion of their advertising revenue that is generated from mobile devices. Facebook has by far the most mobile ad revenue of the group, which is likely to come in a little over $3 billion for the year. Twitter has said that 70% of its revenue is coming from mobile -- and most of that is from the US market.
The mobile component of total ad revenue for Facebook, Twitter and Pandora collectively will be roughly $4 billion for calendar 2013. It's not clear what percentage of Facebook's mobile ad revenue is from the US; however it's likely to be a substantial portion at this stage.
Accordingly, putting together my estimates for US mobile ad revenues from Google, Facebook, Twitter and Pandora takes us to about 90% of projected US mobile ad revenue for the year. Ad networks such as YP, Millennial and a couple of others fill in the rest.
This morning Google announced its new Android OS update, KitKat, as well as a new Nexus handset, the Nexus 5 from LG (priced pretty aggressively at $349). In addition the company said that it would begin indexing "deep links" to Android apps in search results (on Android devices):
Just like it crawls and indexes websites, Googlebot can now index content in your Android app. Webmasters will be able to indicate which app content you'd like Google to index in the same way you do for webpages today — through your existing Sitemap file and through Webmaster Tools. If both the webpage and the app contents are successfully indexed, Google will then try to show deep links to your app straight in our search results when we think they’re relevant for the user’s query and if the user has the app installed. When users tap on these deep links, your app will launch and take them directly to the content they need.
Here's a screenshot provided by Google:
Google doesn't mention what happens if users don't have the specified app installed. Presumably users would be directed to a download page for the app (or maybe there's some kind of detection and the link doesn't appear if the app isn't installed). There's no word on Apple devices. Technically it's probably not possible for Google to do this on iOS devices.
The other significant announcement to come out today is that Google replacing the unique Android ID (similar to Apple's old UDID) with a new "Advertising ID." The new Advertising ID is very analogous to Apple's Identifier For Advertising (IDFA). Google's new Advertising ID implicates ad tracking and targeting in apps only, not the mobile browser.
It moves mobile app advertising away from the unique device ID and "up" to an anonymous identifier that can be cleared or reset by the user at will:
In addition to resetting or clearing the Advertising ID (like clearing cookies in a brower), Google users will be opt out of "interest based ads" (see graphic above). This doesn't mean no ads, just no retargeted or behaviorally targeted ads.
Advertisers and ad networks on Android must migrate to the new Advertising ID after August 1, 2014: "Beginning August 1st 2014, all updates and new apps uploaded to the Play Store must use the advertising ID (when available on a device) in lieu of any other device identifiers for any advertising purposes."
Separate from Advertising ID Google is increasingly trying to get Chrome browser users to sign in so that it can track and better target them across devices (and later into stores). This is an opt-in system and users can simply not sign in if they have privacy concerns.
Apple's IDFA approach has been very well received and Advertising ID should also be. It seeks to strike a balance between privacy and advertiser targeting interests.
Putting aside search marketing, the overwhelming majority of mobile ad creative leaves much to be desired. However video may turn out to be the "killer" mobile ad solution in many instances. That's according to new data from video marketing provider Unruly.
Based on a review of several thousand client campaigns Unruly found that mobile video outperformed video ads on PCs:
There are clearly issues with relying primarily on mobile video as a mobile ad format. Network speeds may be slow, videos many not load and playback may be disrupted. In addition, those with more limited data plans may be inclined to avoid video on mobile devices.
Generally however mobile video consumption is growing. A recent study from the Pew Research Center found that 41% of respondents watched video on mobile phones. Indeed, consumers are increasingly watching video on smartphones and especially tablets.
Mobile (smartphone + tablet) "video starts" constitute roughly 10 percent of digital "video starts" according to Adobe. The Adobe data in the chart above reflect video viewing rates in Q4 2012. Mobile video ads also offer unique social sharing opportunities and are generally effective (or potentially effective) brand advertising vehicles.
There are plenty of data that reinforce the growth of mobile video viewing. Of course video advertising is arguably best suited for video content. But video could be incorporated into display ads of all types. I don't favor "involuntary" video that starts to play once a site loads, as sometimes happens on PC sites. That would be too annoying and have a negative impact on consumer attitudes and receptiveness.
However considerably more information can be communicated through video than the tiny text in most display ads. Video, rich media and landing pages can all be used together to create ads that showcase brand messages as well as direct response elements (e.g., maps and directions, click to call, etc.). Mobile video ads can also generate higher CPMs for publishers.
Ultimately mobile ad formats that include video are going to be much more successful from a creative and messaging standpoint than most current mobile display ads, even most rich media ads in apps.
According to a report (rumor) in Engadget, Google is preparing to build an incentive-based mobile panel to track browsing and app usage behavior. The initiative is called "mobile meter" according to the blog and it would be directed toward iPhone and Android users.
Google would offer some incentive (points, rewards, etc) to motivate users to opt-in and allow their usage to be anonymously tracked. This would be nearly identical to the system currently used by Nielsen.
In addition Placed uses a panel to track mobile and exposures and their impact on store visits. The Placed app (with opt-in consent) watches where users go in the real world and extrapolates their data to estimate the offline impact of mobile campaigns.
Google recently announced Estimated Total Conversions that will track the impact of search ads across devices and, eventually, into stores. The primary methodology relies on signed-in Chrome browser users.
A Google mobile panel would complement that approach and, like Placed's panel, provide data to advertisers -- offering a more holistic view of their campaigns, especially the impact on offline store visits.
Place 2013 brought together the entire spectrum of companies building the indoor location ecosystem. Retailers, technology vendors, mobile developers, data providers, advertisers, agencies, and investors attended this unique, one-day event at the Palace Hotel in San Francisco and was the first-of-its-kind anywhere.
8:45 AM - 9:00 AM
The Consumer Foundations of Place-Based Marketing - The majority of smartphone owners are already using their devices in stores to find product and price information, as well as coupons. Opus Research will present proprietary findings on in-store behavior, privacy attitudes and consumer receptiveness to indoor promotions.
Speaker: Greg Sterling, Senior Analyst, Opus Research
View slides from this presentation
9:00 AM - 9:45 AM
The State of Indoor Location - For the past several years online mapping giants and technology providers have been laying the groundwork for indoor location. What is the current state of the infrastructure? What technologies are already deployed and how accurate are they? What indoor consumer and advertiser scenarios are possible today and what might be possible within three years?
Joseph Leigh, Head of Venue Maps, Nokia
Leslie Presutti, Mobile, Location and Computing Business Unit, Qualcomm Atheros
Zack Sterngold, VP of Americas, Boingo Wireless
Avinash Joshi, Chief Technologist, Wireless LAN Group, Motorola Solutions
9:45 AM - 10:25 AM
Keynote: Why Indoor Location Will Be Bigger than GPS or Maps - The explosion of smartphones with built-in sensors, accelerometers, GPS and WiFi is making indoor positioning not only possible but also inevitable. The emerging indoor opportunity for venue owners, retailers and technology providers is potentially massive. Google’s Don Dodge, an investor and close observer of the space, will explain why he believes indoor location and marketing is going to be huge and potentially larger than GPS and maps.
Speaker: Don Dodge, Developer Advocate, Google
10:45 AM - 11:05 AM
Case Study: Point Inside - Point Inside was one of the early consumer-facing apps in the indoor location space. The company has since shifted its focus to enterprises and enabling retailers to take advantage of indoor location. The company will present a new case study featuring a major home-improvement retailer.
Speaker:Todd Sherman, Chief Marketing Officer, Point Inside
View slides from this presentation
11:05 AM - 11:30 AM
Featured Case Study: Forest City and Path Intelligence - Forest City Enterprises are many years into using mobile device monitoring and advanced indoor analytics to help create a better environment for their shoppers and their retailers. Hear from the project sponsor and partner Path Intelligence on how they have transformed asset management, leasing, and marketing.
Stephanie Shriver-Engdahl, VP, Digital Strategy, Forest City
Cyrus Gilbert-Rolfe, VP, Path Intelligence
View slides from this presentation
11:30 AM - 12:15 PM
Digital Analytics for the Real World - Using a variety of technologies to identify when and where smartphone shoppers are in stores, retailers can now leverage "big data" previously reserved for Internet companies alone. These "real world analytics" hold profound implications for everything from in-store merchandising and staffing to consumer marketing. Leaders in the segment will offer views on opportunities and potential pitfalls for indoor analytics.
Jon Rosen, Executive Vice President, iInside
Will Smith, CEO, Euclid
Alexei Agratchev, Co-Founder, RetailNext
Michael Healander, General Manager, GISi Indoors
1:15 PM - 1:55 PM
Retail Spotlight: Aisle411 & Dick's Sporting Goods - Aisle411 will discuss current retail deployments and their impact on operations, consumer loyalty and marketing. Dick’s Sporting Goods will share how it’s thinking about indoor location, privacy issues and the overall opportunity. And Bob Rosenblatt, former COO of Tommy Hilfiger Group, will outline the intriguing business opportunities for retailers in develop- ing indoor marketing strategies.
Nathan Pettyjohn, Founder & CEO, aisle411
Rafeh Massod, VP, Customer Innovation Technology, Dick's Sporting Goods
Bob Rosenblatt, CEO, Rosenblatt Consulting
View slides from this session
1:55 PM - 2:15 PM
Using Store Visits and Data for Advanced Retail Intelligence - Online to offline has been the dominant but largely invisible paradigm of Internet-driven spending. Using mobile to better target and influence store visits is only the beginning. PlaceIQ CEO Duncan McCall will offer a major retail case study fo- cused on measuring store visits after mobile ad exposures. He will also discuss how to connect online, nearby and indoors for a more complete picture of the customer journey.
Speaker:Duncan McCall, Co-Founder & CEO, PlaceIQ
View slides from this presentation
2:15 PM - 3:00 PM
Ad-Tracking to the Point of Sale - Panelists will discuss the current and future use of indoor location as a way to demonstrate ROI and sales lift on a per- campaign basis. What is the current state of the art in matching store visits to ad exposures? And what are the broader implications of connecting online ads and offline data?
Monica Ho, Vice President of Marketing, xAd
David Shim, Founder & CEO, Placed
Ameet Ranadive, Director of Product, Twitter Ads Team
Michael Shevach, SVP Ad Solutions, Retailigence
Duncan McCall, Co-Founder & CEO, PlaceIQ (moderator)
3:20 PM - 3:50 PM
Opt-in or Opt-out: Indoor Location & Consumer Privacy - Indoor location has already gained the attention of members of Congress and been called "troubling." While not everyone agrees about the level of concern, there are obvious consumer privacy issues raised by in-venue smartphone tracking. How should the companies be addressing these issues today and what might regulation require tomorrow?
Jennifer King, School of Information, UC Berkeley
Jules Polonetsky, Executive Director & Co-chairman, Future of Privacy Forum
3:50 PM - 4:10 PM
Case Study: Meridian/Aruba Networks - Meridian, who was recently acquired by Aruba Networks, will offer two indoor case studies, one involving a small business (Powell’s Books in Portland) and another involving a major U.S. apparel and housewares retailer.
Speaker: Jeff Hardison, Vice President, Meridian
View slides from this presentation
4:10 PM - 4:55 PM
Microfencing: Targeting In-Aisle Shoppers - Billions of dollars are spent each year by brands and manufacturers trying to influence consumer buying in stores. A percentage of that money will migrate to indoor digital marketing. What conditions must first exist and what will those brand-consumer interactions look like? The panel will explore these questions as well as the contours of the broader indoor marketing experience.
Neg Norton, President, Local Search Association Ben Smith, CEO, Wanderful Media
Melissa Tait, VP of Technology, Primacy
Erik McMillan, CEO, BrickTrends
Asif Khan, Founder, Location Based Marketing Association (moderator)
4:55 PM - 5:30 PM
Reality Check: Assessing the Indoor Opportunity - The other sessions explored major opportunities (and challenges) of indoor location and marketing. Now it’s time for a fun, yet sober assessment of whether and how soon these scenarios will come to pass. Is there real demand and who will own the “indoor channel”? Where will the "place-based market" be next year, in three years?
Jeremy Lockhorn,VP, Emerging Media, Razorfish
John Gardner, Partner, Nokia Growth Partners
Chandu Thota, Engineering, Google
Wibe Wagemans, IndoorAtlas
This morning the IAB released Q2 and 1H 2013 mobile ad revenue figures for the US market. Total revenues were $20.1 billion compared with $17 billion a year ago. Mobile ad revenues were just over $3 billion vs. $1.2 billion during the same period in 2012.
That represented growth of 145%. Mobile was 15% of overall digital ad revenue in the first half.
Total mobile advertising in 2012 was just under $3.4 billion. This year mobile advertising should come in at over $6 billion. The holidays should give mobile advertising a substantial boost however it's likely to remain about 15% of total online advertising for 2013.
The IAB has stopped trying to estimate subcategories of mobile as it did in 2011. Mobile search is the largest ad sub-category of mobile spending and probably exceeds 50% of the total. Display is second followed by video and other ad categories (SMS based advertising or marketing continues to fade). Search and mobile display represent the mobile ad spending.
While consumers spend 80% of their time in apps, apps don't represent 80% of the mobile ad spend -- given the dominance of mobile search, which mostly happens via a mobile browser.
The top three overall online advertiser categories were Retail (20%), Financial Services (14%) and Automotive (12%).
One of the questions that we'll be addressing on the "Microfencing" (in-store/in-aisle targeting) panel at Place 2013 is "who will own the indoor channel?" The operating assumption is that the venue owners/retailers will control communications and marketing within their indoor environments. But that may not turn out to be true if retailers aren't careful and quick to embrace indoor location.
An analogy may be the wireless carriers. Once the gatekeepers of all things mobile, they have largely been sidelined and reduced to "commodity" providers of bandwidth. The handset OEMs, platform providers and app developers dominate mobile.
Earlier today Reuters reported that Cisco was "working with Facebook Inc to offer free Wi-Fi Internet access to consumers at public places such as hotels or retail stores using their Facebook log-in. A visitor could check in at a hotel without having to line-up at a front desk by simply signing in via the Facebook application on a smartphone, Cisco said."
Google is also contemplating its own WiFi infrastructure. By the same token some retailers are hesitant or cautious about embracing indoor location. For example, JC Penney decided to eliminate public WiFi to save $7 million a year. In doing so it shut down its indoor location consumer infrastructure. While it will save some money it won't stop showrooming and may deprive JC Penney of an important marketing and customer service capability.
If companies such as Facebook and Google, or other third parties, step in and provide the consumer network, chances are very good that consumers will use the Facebook or Google network rather than the store's. That would likely make the Google and Facebook the new gatekeepers of indoor marketing, giving them a significant advantage over retailers and a stronger position when it comes to selling and delivering indoor advertising and promotions.
Retailers cannot and should not "wait and see" or they may find themselves, like the wireless carriers, on the sidelines of digital marketing activity in their own stores. I could be wrong and there are a number of unknown variables. But retailers stand to lose much if they fail to act.
We'll fully explore these questions at the Place Conference on Tuesday, October 8:
Microfencing: Targeting In-Aisle Shoppers
Billions of dollars are spent each year by brands and manufacturers trying to influence consumer buying in stores. A percentage of that money will migrate to indoor digital marketing. What conditions must first exist and what will those brand-consumer interactions look like? The panel will explore these questions as well as the contours of the broader indoor marketing experience.
Jumptap (now part of Millennial Media) and comScore released a report last week on cross-platform device usage. The report contains considerable data about smartphone and tablet penetration, day parting and device usage by content category and demographic group.
Much of the data is from comScore and has already been released in other contexts. However there were a number of interesting data points in the report worth revisiting, including the fact that combined smartphone and tablet time online now exceeds time online with PCs.
As a general matter smartphones and tablets have increased overall time spent online rather than simply cannibalizing PC time, though there has been some of that (e.g., maps, local).
Another interesting set of data in the document explore device share of online minutes by content category or vertical. The PC is dominant (more than 50% of time spent) in a little more than half the categories examined.
PC usage is highest in the automotive segment and lowest in "radio" (think Pandora). Retail sees slightly more mobile than PC time.
The numbers above are aggregate data. Demographic segments are going to display different device behaviors. For example, those in the US under 30 are likely to be more involved and spend more time with smartphones than those over 50. That pattern has been repeatedly shown in our surveys and other third party data, including this report.
Below are the demographic groups profiled in the report:
Age 18 - 24:
Women 25 - 49:
Men 25 - 49:
There's quite a bit more data in the report, which can be downloaded for free.
As a broad takeaway marketers can now assume almost everyone above a certain income threshold is "cross platform." The minority are "smartphone only" or "PC only" (select younger and older users respectively).
Marketers can also reliably make the assumption that those under 45 are going to favor smartphones vs. PCs as primary devices in a wide range of categories. However people are also rational and prefer larger screens in many contexts (at least until mobile user experiences are improved).
By comparison tablet behaviors are still being established. However the tablet is typically used as a PC substitute (provided a larger screen) in the home.
I wrote several days ago on my Screenwerk blog about PayPal's new Beacon payments and indoor location initiative. I explained that Apple's decision not to include an NFC chip in the new iPhone means essentially that NFC is marginalized if not dead in the US market. In its place Bluetooth Low Energy (BLE) may become the mainstream alternative to what NFC would have enabled (e.g., mobile payments).
PayPal Beacon relies on BLE. At those businesses where a Beacon device is plugged in PayPal users simply check-in. Beacon identifies them and payment is automatically transferred from the default account. Payment happens “hands free” without a tap, swipe or other app interaction.
Beacon is also PayPal’s entry into indoor location. PayPal will obviously know you’re in a venue and then can do any number of things, including delivering highly specific, indoor marketing messages or ads. PayPal is also making Beacon available to third party developers, who will be able to do similar things accordingly.
Apple's iOS 7, which will be available on September 18 (to older iPhones as well), will permit all eqipped devices to interact with BLE iBeacons in malls, airports, stores and other venues.
Apple acquired indoor mapping company WiFiSlam earlier this year. That was the "wake up call" for many people to take indoor location seriously. One of the first and obvious applications of iBeacon is indoor mapping. But it doesn't stop there.
Just as with PayPal's BLE initiative, iBeacon will enable Apple to move into payments and indoor marketing and allow third party developers to leverage those capabilities. With its more than 600 million credit cards on file I've got to believe that Apple will enter mobile payments eventually and BLE will be the way in all likelihood.
More broadly I suspect that iBeacon will popularize and jumpstart indoor location for a host of third party developers.
For a comprehensive introduction to the indoor location and marketing opportunity, and its broader implications, come to Place 2013.
MoPub presents itself as the "world's largest RTB exchange for mobile apps." Arguably, MoPub emerged over the past couple years as the leading mobile-publisher/developer exchange.
In May the site announced it had reached a $100 million "run rate." That of course is tiny compared to the major mobile networks and publishers such as Google and Facebook.
Today one of the other major mobile ad platforms, Twitter, announced that it had acquired MoPub. TechCrunch estimated that the purchase price was $350 million. MoPub said nothing would change for the publishers in its network:
It’s important to underscore that our commitment to you, the publisher, will not change. In fact, it will be strengthened. Twitter will invest in our core business and we will continue to build the tools and technology you need to better run your mobile advertising business.
In addition to investing in new capabilities for our publisher platform, we believe there are opportunities to bring better native advertising to the mobile ecosystem. With the support of the team and resources of Twitter, we’ll be able to move even more quickly towards the realization of our original vision.
MoPub CEO Jim Payne likened Twitter's acquisition of MoPub to Google's acquisition of DoubleClick. He argued that Twitter's resources would enable MoPub's to get even stronger and serve its publishers better. Indeed Twitter's brand strength and clout may attract more mobile advertisers to the platform.
For its part Twitter was pretty transparent about what it was after in buying MoPub:
The MoPub team has built a leading mobile ad exchange, and their focus on providing transparency to advertisers and publishers aligns with our values. We’ll continue to invest in and improve their core business. In particular, we think there is a key opportunity to extend many types of native advertising across the mobile ecosystem through the MoPub exchange.
We also plan to use MoPub’s technology to build real-time bidding into the Twitter ads platform so our advertisers can more easily automate and scale their buys. We’ll maintain the same high quality standards that define our platform today. Our approach is to show an ad when we think it will be useful or interesting to a user, and that isn’t changing.
This acquisition gives Twitter a significant new mobile asset and ad network. This follows Millennial's acquisition of Jumptap for technology and more scale. It may also indicate that a new wave of mobile network consolidation has begun.
Last year Google brought in ad revenues of $43.7 billion. This year, thus far, the company has made roughly $24 billion. For the full year 2013 Google is likely to earn $50 billion in advertising revenue. That may be a low projection, however.
EMarketer today released some estimates on the breakdown of PC vs. mobile and search vs. display revenues for Google. According to the estimates, search will generate 82% of Google's overall revenue this year with just under 20% of search revenue coming from mobile.
By comparison 2% of display ad revenue will come from mobile.
Over time the data aggregator sees more than 40% of Google's total ad revenues coming from mobile (search + display).
Let's look at what these breakdowns (if accurate) would mean in real terms, assuming $50 billion in total projected ad revenue for 2013:
The other way to view those revenues is the following:
If the standard US (45%) vs. international (55%) ad revenue distribution holds for mobile then the following will be the rough figures for Google mobile ad revenue by geography (approximately):
Despite the above, Google's US mobile ad revenue is likely to be somewhat stronger than its mobile revenues from outside the US. Accordingly I would probably flip those percentage figures when it came to mobile.
Last year the IAB reported that mobile ad revenue in the US was $3.4 billion. This year it's likely to hit $7 billion according to our estimates. If that's correct then the Google figure above is too aggressive.
Pandora is now essentially a mobile company. Although its users listen on multiple platforms, mobile is the driver of the company's growth and revenue. It's iPhone app arguably saved the company from going under in 2008.
Last week Pandora released revenue numbers for Q2. The company had earnings of $162 million. Ad revenue was $128 million and subscription and "other" revenue was more than $33 million.
The company also said that $116 million of that revenue was attributable to mobile. That works out to almost 72% of overall ($162 million) quarterly revenue coming from mobile devices. By comparison Facebook said that 41% of its Q2 2013 revenue came from mobile.
The company didn't break out mobile revenue in more detail so it's not clear whether the $116 million is all advertising or whether some of the subscription and "other" revenue is being attributed to mobile. My guess is that subscription revenue would not attributed to mobile.
Potentially then if the $116 is all ad revenue it would mean that essentially 90% of Pandora's ad revenue was being generated by mobile users.
This morning the Pew Internet & American Life project released new data on teen app usage and mobile privacy. The big "takeaway" is that teens care very much about privacy and have taken action against (deleted) mobile apps they feel unnecessarily or gratuitously collect personal information or location data.
Pew says that 78% of teens have a mobile phone (though not all have smartphones) and 23% have tablets. The teen smartphone penetration number is probably 58%, given that's the number of teens who have downloaded mobile apps.
Just over half (51%) "have avoided apps due to privacy concerns" while 26% have uninstalled an app because it was collecting personal data. And 46% of teen mobile users have turned off location tracking features (on their phone or in an app) out of concern for privacy.
Teens are more forgiving of apps that seek location data where there's a logical and clear justification for the information (e.g., maps). Girls are more likely to disable location tracking than boys; 59% of girls vs. 37% of boys have done so.
Separately but still on the theme of privacy, Facebook announced today that it would give more control to Facebook mobile log-in users over what information is shared by third party apps on the Facebook Timeline and News Feed. Here's what the company said today in its announcement:
Although Facebook Login is widely used, we understand people’s concerns about apps posting on their Timeline or to their friends. For the past several months, we’ve been rolling out a new version of Facebook Login on mobile to address these concerns.
With this new update, mobile apps using Facebook Login must now separately ask you for permission to post back to Facebook.
Don’t want to share your music playlist or workout routine with friends? You can choose to skip sharing altogether.
Clearly separating sharing means people can decide whether they only want to use Facebook Login for fast registration without also sharing back to Facebook. If you want to share later, you still can.
This involuntary sharing element was a selling point for publishers and developers but a turn-off to many users. It became a significant barrier for some to using Facebook log-in for third party apps/sites.
By separating sharing from social log-ins Facebook hopes to remove friction for many people who might log in with Facebook but don't today for privacy reasons. I'm in that group.
Last week Placed introduced Placed Attribution, a mobile ads offline tracking solution. The idea is to used Placed's opt-in panel to measure the impact of mobile ad exposures on in-store visits. PlaceIQ has a similar offering using a different methodology.
Capturing the offline impact of digital ads on store visits (and potentially sales) is really a kind of "holy grail" when it comes to conversion tracking. The ratio of online to offline conversions is skewed heavily in the direction of offline. E-commerce is only 5.5% of offline retail and mobile commerce is approaching 10% of e-commerce.
Yet up to half of offline retail spending may not be impacted by digital media and the internet. Clicks are a terrible metric for mobile advertising, and secondary metrics like map views and calls are better but don't capture the entire picture for marketers.
There's a lot more "visibility" on performance when you can start to measure how digital ads impact offline purchase activity. That's the objective of Placed Attribution. Here are the kind of data to be reported: