Data And Forecasts

Has Android 'Peaked' in the US?

Android's share (of smartphone shipments) across the globe is gaining momentum according to the latest IDC numbers. By contrast there's evidence that Android's US share may have "peaked" according to analysis from Asymco's Horace Dediu. 

Below are IDC's estimates showing global market share for Q2 by shipments: 

  • Android: 79.3% (2012: 69.1%)
  • iOS: 13.2%  (2012: 16.6%)
  • Windows Phone: 3.7%  (2012: 3.1%)
  • BlackBerry: 2.9%  (2012: 4.9%) 
  • Others: 1%  (2012: 6.2%) 

Thus Android stands near 80% of global smartphone shipments, which aren't identical with sales. But it's a directional indication of actual sales.  

However in the US market the story is different; Android's share is flat (per comScore): 

smartphone market share june by OS 

Dediu points out that over the past six to eight months in the US the iPhone has gained more usage than Android (11M vs. 6.6M users). So it would appear that Apple's US and international fortunes have significantly diverged. 

However we also have research from CIRP, which finds (via survey data) that "first time smartphone buyers" in the US (meaning those buying smartphones for the first time now) tend to be older and more price sensitive. They buy "secondary Android brands" (e.g., LG) and keep their phones longer. 

Apple's strategy for more price-sensitive consumers has been the iPhone 4 and 4S, which has been reasonably successful to date. However rumors suggest a low-cost "plastic" iPhone for emerging markets and more price-conscious consumers. 

When looked at in the context of overall computer operating systems (including the PC), Android will be the dominant OS by 2015 on a global basis -- far outstripping Windows. By comparision, Apple's overall OS share (iOS + Mac OS) is expected to nearly match Windows. 

Nielsen: US Smartphone Penetration Now 62%

Nielsen revised slightly upward its smartphone penetration data for the US market. Last quarter the figure was 61%; as of today Nielsen says that 62% of American adults own smartphones. 

Kantar research has been arguing that their data show the rise of Windows Phones in the US. However the Nielsen numbers reflect that in Q2 Windows Phones had just 2.3% market share. BlackBerry had 3%. And the remainder, 92%, was divided between the iPhone and Android. 

Apple continues to be the single leading smartphone OEM, followed by Samsung. Motorola, HTC and LG are closely arrayed after that.  

file

Motorola is hoping to "reboot" its brand and sales with the new Moto X. What's perhaps most fascinating about the handset is that it targets women specifically, by positioning the phone as a personal fashion accessory.

Motorola's former (pre-Google) strategy had been very spec- and male-centric. The company had even attacked the iPhone at one point for being a "princess." At least with this model (Moto X) it's a dramatic shift for the company. 

Conflicting Claims: Which Smartphone Is More 'Satisfying'?

Last week the American Consumer Satisfaction Index (ACSI) released findings asserting that the Samsung Galaxy S3 and Galaxy Note II beat the iPhone 5 for customer satisfaction. The Galaxy S4 was not part of the study, which was conducted before the device's release. Somewhat Ironically, Korean consumers said the opposite: that they preferred Apple devices to Samsung's. 

Here are the US ACSI scores by device: 

Smartphone Customer Satisfaction 2013

Survey questions addressed the following areas:

  • Design (including weight and screen size)
  • General handset features
  • Video and audio quality
  • Software and ease of use (including OS and UI) 

What's interesting is that Apple rates higher than Samsung overall in the ACSI company scores -- though Samsung has closed the gap vs. 2012: 

 

Apple more handily beats Samsung in the JD Power ratings, where the iPhone 5 contributed to Apple's overall 2013 smartphone win. In the JD Power satisfaction scoring, Samsung is at the bottom of the group. How can these conflicting scores (within the ACSI and between ACSI and JD Power) be reconciled?

 

The ACSI report offers no real explanation for the Galaxy and Galaxy Note wins. Other than screen specs, Samsung's phones are not the highest quality Android devices on the market. Arguably HTC, LG and perhaps Motorola have stronger offerings from an overall quality perspective. However Samsung outspends them all (combined) on marketing, which has been the chief driver of the Galaxy line's success. 

My suspicion is that consumers are responding to screen size more than any other single variable or factor in rating the Galaxy S3 and Note II above the iPhone. This underscores the larger-screen imperative that Apple now confronts. The company needs to produce an iPhone with a larger screen. And according to multiple rumors, that will happen with the iPhone 6 though not the "5S," which is supposed to retain its current screen of just over 4 inches.

The new Google-Motorola Moto X chose not match the S4 and go to 5 inches after the company did considerable consumer research and arrived at 4.7 inches as the optimal screen span. Accordingly, an ideal screen size for a smartphone is probably right in-between the current iPhone 5 (4 inches) and the Galaxy S4 (5 inches). 

Facebook Winning App Game, Where's Google Maps?

There's considerable data (see, e.g., comScore) that indicate Facebook is the most popular mobile app in the US market. That extends beyond unique visitors to engagement and time spent.

Time spent with the Facebook mobile app outstrips every other individual app by a large margin. Earlier this year comScore found that 23% of all time spent with mobile apps was on Facebook. Nielsen has similar figures.

Facebook & Google: Mobile Apps by Share

Source: comScore (Q1 2013) 

Confirming just how popular Facebook's app is relative to other mobile apps are new survey findings from Consumer Intelligence Research Partners. The company asked 500 smartphone users and 1,000 tablet owners in the US about which mobile apps they used most often. 

The question was: "What are the three apps you use most frequently?" There were no suggested responses (no multiple choice answers). The question was completely open-ended. Below are the results: 

Among other interesting things Google Maps doesn't make an appearance in the surve results. Yet Nielsen and comScore data reflect that Google Maps is one of the most popular apps and the most popular location-based app. Mysteriously it doesn't appear here at all -- unless it's considered part of "Google." There's no clear explanation why.

Top US Mobile Apps Ranked by Unique Visitors

Source: comScore (Q1 2013)

Facebook Mobile Ad Revs Now 41% of Total

Facebook announced its Q2 2013 revenues a few minutes ago. Overall the company beat analysts' expectations with $1.81 billion in total revenue. Advertising supplied $1.6 billion of that total with payments and fees providing $214 million.

The big suprise was mobile, which was responsible for 41% of total ad revenue (or $656 million) -- up from 30% last quarter. Here are the mobile numbers: 

  • Mobile monthly active users grew to 819 million
  • Daily mobile users in Q2 were 469 million
  • There were 219 million mobile only users

Facebook monthly mobile users

The company said on its earnings call that it's investing in "mobile, measurement and product innovation." The company said it has the most effective mobile ad products and is in a position to lead the mobile ad market. Indeed the company is second only to Google now in mobile advertising revenue. 

Apple's $35.3 billion Quarter Visualized

Apple just reported a $35.3 billion quarter, which was somewhat better than a year ago and beat financial analyst expectations -- largely on the strength of iPhone sales. The company also announced profit was $6.9 billion (vs. $8.8 billion a year ago). Sales outside North America accounted for 57% of revenue.

The company sold 31.2 million iPhones (vs. 26 million a year ago). But it sold fewer iPads than expected:14.6 million. Mac sales were down but Macs outperformed the PC industry as a whole, which is slumping badly. 

Below are two charts that show the distribution of revenues by segment/geography and by product line (figures in $billions): 

Unit sales of iPads were a concern for many financial analysts. The company sold 14.6 million tablet devices compared with 17 million last year and more than 19 million last quarter. While this implies market share erosion or shift away from the iPad, today Chitika released data showing that in North America at least, the iPad's web traffic share had grown since April and now stands at just over 84%. 

June iPad traffic

Source: Chitika

While Apple continues to generate huge quarterly revenues growth has slowed or declined in some cases. Accordingly there's enormous pressure from investors to bring out new products or create new product categories: TV, wearables, etc. On the earnings call Apple CFO Peter Oppenheimer said, “We are on track to have a very busy fall" though he wouldn't elaborate.

New iPads and iPhones are expected to be introduced. There may even be "surprise" products such as the rumored iWatch. 

Study: 97% of Mobile Search in Gas & Convenience Category Happens in Apps

In honor of the blazing US summer and road trips, xAd and Telmetrics have released more data from their "Mobile Path-to-Purchase Study," this time on consumer behavior in the "Gas & Convenience" category. The study, which combined a mobile user survey (n=2,000) and consumer behavior data (n=6,000), was conducted by Nielsen earlier this year.

As might be expected the study reflects the very mobile-centric nature of the category, which includes convenience store visits, gas purchases and minor automotive service (i.e., oil changes). 

Below are the study's key findings:

  • 85% of time in the category "is spent on a smartphone with most conducting gas price comparisons/searches"  
  • 97% of mobile search happens within an app vs. mobile web (e.g., GasBuddy)
  • 80% of smartphone search and 40% of tablet search happens on the go (out of home) 
  • 88% plan to buy within the same day (2/3 within the hour) but only 10% have a specific place/business in mind
  • Location and price were the two factors that most influenced conversions (75% sought a location within five miles)

Interestingly, the study reported that "Gas & Convenience searchers spend an average of 6 minutes per mobile search session," which is 50% more than "the average Retail mobile search session." 

The study also found that Gas & Convenience users were very open to influence and receptive to mobile advertising, especially if the ad pertains to a nearby location and/or offers a deal or coupon. 

Retailers Fail to Connect with Customers Via In-Store Technologies

While countless retailer apps and mobile websites are designed specifically to deliver an "omnichannel" experience -- tracking a customer through the lifecycle of a purchase -- retailers are missing out on opportunities to engage customers through in-store technologies, says a new report by EKN Research.

A survey of more than 60 large retailers found just 13% of retailers are offering in-store features for mobile apps indicating a significant gap in leveraging the use of smartphones or mobile devices for customer engagement.

In terms of providing the infrastructure for ubiquitous connectivity, only 1 in 5 retailers currently offer free in-store wi-fi, with 42% of retailers having no intention of ever offering free wi-fi in stores.

InStore_Technologies_Jul8

Mobile technologies may offer new opportunities for customers but many retailers are not willing to make the investment. The report finds that IT spending on store technologies will remain relatively flat in the next three years, representing 31% of the total IT budget in 2013. Though the share is expected to increase to 35% by 2016.

"In 2013, increasing store operations efficiency remains retailers’ top goal from investments in store technologies. Running an efficient store should be table stakes for mature retailers, and their top goal should focus more directly on improving customer engagement. EKN views this as evidence that the focus hasn’t yet shifted for a majority of the retailers."

This news comes on the heels of a recent comScore report that found consumers are open to communications from retailers on their mobile devices with 47% of shoppers willing to have a retailer to send a coupon to their smartphone when they are in-store or nearby.

And previous data suggest a majority of mobile users are accessing retailers' websites for in-store sales or customer service functions.

We'll be exploring the current pulse of retailers and in-store marketing technologies at our upcoming Place Conference this October in San Francisco.

IAB: Mobile Advertising Worth $8.9 Billion Globally in 2012

The IAB released a global mobile advertising report for 2012 this morning. It reflects ad share by region and ad format. The IAB sizes the global mobile advertising market at $8.9 billion (€6.9 billion) in 2012.

The North American mobile advertising market was worth $3.5 billion in 2012. It lagged just behind APAC and should overtake that region this year. 

The following are the values of the other global-regional markets: 

  • Asia-Pacific: 40.2% ($3,558 million/€2,769 million)
  • Western Europe: 16.9% ($1,499 million/€1,167 million)
  • Central Europe: 1.3% ($112 million/€87 million)
  • Middle East & Africa: 1.2% ($109 million/€85 million)
  • Latin America: 0.6% ($50 million/€39 million)

Mobile paid search (read: Google) is the dominant form of mobile advertising on a global basis and in most individual regional markets according to the IAB:

With the possible exception of Latin America, with its more limited smartphone penetration, SMS-based advertising is shrinking around the globe. 

Despite mobile paid-search's global dominance, search and mobile display are seeing comparable growth rates:

Google is clearly one of the beneficiaries of these trends but so will be Facebook, Twitter and a few ad networks. Fewer than 10 companies are in a position to control three-fourths of the global-mobile ad marketing in 2013. 

Report: iPhone Closing Share Gap with Android in US

Yesterday Kantar Worldpanel ComTech reported that the iPhone has gained on Android in the US market. The firm said the relative market shares of Android, iPhone and Windows Phones are now as follows:

  • Android: 52%
  • iPhone: 41.9%
  • Windows Phone: 4.6% (up 0.9% YoY)

The iPhone is the bestselling individual smartphone in the US, though not across the globe.

Kantar asserts that its survey data are more accurate than other sources because it operates "the largest continuous consumer research mobile phone panel of its kind in the world, conducting more than 240,000 interviews per year in the U.S. alone."

For comparison purposes comScore reports the following (May, 2013) smartphone market share in the US: 

  • Android: 52.4%
  • iPhone: 39.2%
  • BlackBerry: 4.8%
  • Windows Phone: 3.0

Comscore shows Android and the iPhone gaining in the US and all other operating systems losing share vs. last quarter.

While the iPhone may have gained in the US that trend does not appear to be global. Kantar reports that Android's share is now nearly 70% in Europe and even higher in China.  

Unlike Mobile Payments, Consumer Behavior for Indoor Marketing Well Established

The mobile payments space is a little like the local market: lots of promise, lots of money but very hard to crack. Yesterday a young entrepreneur and his payments startup Clinkle received a $25 million vote of confidence from a group of celebrity investors.

This was reported to be the "largest seed round ever." Whether it is or not $25 million is a lot of money for yet another mobile payments app. While it's true that nobody in mobile payments has "broken through," Clinkle will have a tough slog as it tries to build both merchant adoption and consumer usage.

Once again it's the "cold start" or "chicken and egg" problem. 

However, according to the NY Times, there's no merchant hardware requirement for Clinkle and the go to market strategy involves a Facebook-like focus on college campuses and surrounding businesses. That may be a key decision and help the startup gain some quasi-critical mass in selected markets among students. 

Beyond the hardware issues surrounding NFC adoption, the central issue with mobile payments has been a lack of perceived need among consumers. Mobile payments are being used in selected contexts and commerce situations (e.g., Starbucks) but the public at large hasn't seen the need to replace plastic payment with app-based payment that relies on stored credit cards or bank accounts. 

That brings me to indoor location and marketing. When discussing these topics, and the absence of technology standards, I often use mobile payments as an analogy. Yet there is a critical distinction. The difference between the two segments is that while mobile payments still largely requires a shift in consumer behavior, indoor marketing does not.

Large majorities of consumers are already using their smartphones in stores to look for price information, product reviews and coupons. The idea of brands and retailers communicating with them in stores will be built on this existing behavioral foundation. Accordingly indoor marketing won't require consumers to adopt new technology or approaches to shopping -- unlike mobile payments. 

The "heavy lifting" in indoor marketing is on the merchant side, where WiFi or other sensor infrastructure needs to be in place. Fortunately in most major retail environments the rudimentary infrastructure already exists.

But don't take my word for it. We'll be discussing the competing indoor location technologies and hardware requirements for indoor marketing (as well as their accuracy) at Place: The Indoor Marketing Summit this fall in San Francisco. It will be an event anyone in the mobile or location-based marketing space won't want to miss. 

BlackBerry Posts Fiscal Q1 Loss: Is It All Over?

BlackBerry posted a "suprise loss" (based on analyst forecasts) in fiscal Q1 of $84 million. The company announced that it had shipped 6.8 million smartphones. However of those only 2.7 million were BlackBerry 10 handsets (Z10 and Q10). 

The much-touted Z10 all-touchscreen phone seems to be a complete flop. The more "traditional" Q10, with its hardware keyboard, may wind up being more successful; it has only been on the market a few months.

These phones, it now seems clear, won't save the company. And BlackBerry is becoming increasingly marginalized in the smartphone and tablet world -- even in the enterprise it's traditional stronghold.

In terms of tablets BlackBerry said that it shipped 100,000 Playbooks in the quarter. BlackBerry CEO Thorsten Heins has dismissed tablets as mere fashion. He doesn't think the devices will exist in five years. While the iPad may not reign forever tablets will continue to exist certainly. Heins is mistaken.

The Playbook won't be getting an OS update and is effectively dead in the water. In North America it delivers less than 1% of overall tablet traffic, according to ad network Chitika. The chart above reflects the "tier 2" tablets that lag the iPad, Kindle and Galaxy in terms of web traffic. (The iPad delivers 82% of North American tablet traffic.) 

Gartner's global OS projection for 2014 shows BlackBerry having an almost non-existent market share.

Device share by OS 2014

Source: Gartner (6/13)

The hard question to answer now is "what next?" The transition-turnaround story clearly won't play to investors anymore. The stock is off 27% following the earnings releas.

Selling the company or taking it private are two options. But who would buy it? (Certainly BlackBerry would be acquired at the "right price.") Microsoft has flirted with the idea but it probably wouldn't serve Redmond because BlackBerry hardware isn't prized in the market and would be unlikely to advance Windows Phones.

Another "nuclear" option would be to start putting out BlackBerry Android-powered phones. However that would turn the company into a commodity provider of Android handsets without any meaningful differentiation. That was what Nokia was concerned about (although Nokia would have had more success with Android.) And it would be almost impossible to compete with Samsung globally. 

The company is almost out of options. 

Superman Can't Save Nokia, But Can Iron Man Help HTC?

Nokia paid for product placement in the wildly popular Dark Knight films and released a special Batman-themed Lumia 900 when The Dark Knight Rises was released. The short answer: no, it didn't really "work."

Nokia Windows Phones (Lumia 925) also appear several times in the also extremely popular Man of Steel. Apparently in the alternate reality of Metropolis Nokia-made Windows Phones are the only smartphones in existence. However even the Man of Steel with all his remarkable alien abilities and strength probably won't do much for Lumia handset sales. 

The Superman film is opening in China this week and Nokia is offering a Chinese "Superman Limited Edition" Lumia 925 with the "hope" (S) insignia on the back. Depending on how excited the Chinese are by Man of Steel there may be some sales lift. However the Chinese market is dominated by Android devices. 

Meanwhile over in the Marvel universe (Superman is a DC Comics character), Iron Man's Robert Downey Jr. is reportedly being paid $12 million in a two-year deal to promote HTC smartphones. It doesn't look like the Iron Man character is part of the deal or will appear in the ads. 

Downey is a recognizable and popular celebrity but he probably isn't powerful enough -- at least without the Iron Man suit -- to compete with Samsung's Galaxy juggernaut (The Avengers might collectively have a shot at defeating it). The Korean company spent over $400 million in 2012 to achieve and maintain its Android smartphone lead. That compares with HTC's $46 million and Nokia's almost non-existent $13 million. 

Report: Google 'Enhanced Campaigns' Raising the Cost of Mobile Ad Clicks

If you're not already aware, Google is compelling all AdWords advertisers to adopt Enhanced Cam­paigns by July 22. It's mandatory. And it signals big changes for Google and for search marketing in general. Google dominates paid-search, which is the biggest single chunk of online advertising.

The high-level shifts brough about by Enhanced Campaigns, if you don't already know, are the following:

  • Tablets and PC ads are grouped together and cannot be separated or segmented in campaigns
  • Neither smartphones nor PC ads can be excluded in any campaign
  • Mobile bids are adjusted as a percentage (higher or lower) of PC AdWords bids 

Google's rationale is simple: simplification. Google told us a few months ago that it wanted to make cross-platform campaigns easier to execute and easier to manage. But that means marketers give up some amount of control over bidding and can no longer implement mobile-only campaigns. 

There are many people who accept and agree with that justification. However there's a much more cynical view circulating in parallel, which is that Google is mostly trying to boost mobile CPCs and thus overall mobile revenues -- to compensate for declining desktop CPCs in some cases. 

Increase in CPCs for tablet and mobile campaigns on Google 

 Reversal of negative desktop CPC growth

 

Like all such competing explanations, the truth lies somewhere in-between.

Historically mobile and tablet CPCs were lower and thus a better value for marketers. Now Adobe's digital marketing arm is saying that will definitely change under the new Enhanced Campaigns regime. Adobe based these remarks on "the lat­est search mar­ket­ing and cost-per-­click (CPC) trends across nearly 100 major US adver­tis­ers rep­re­sent­ing more than $100 mil­lion in ad spend from March through May 2013."

The data come from the clients of the former Efficient Frontier, which Adobe acquired in late 2011 for roughly $400 million. 

As the graphs above reflect, mobile CPCs have already begun to rise for advertisers implementing Enhanced Campaigns, while desktop CPCs are stabilizing. According to Adobe:  

With the intro­duc­tion of Enhanced Cam­paigns, the his­tor­i­cally lower CPCs for tablet cam­paigns should increase to reflect desk­top CPCs. We’re only just begin­ning to see this trend mate­ri­al­ize . . . The over­all CPC trends across all devices includ­ing desk­tops also show strong growth. Google CPCs increased more than 6% over the last three months alone — a sig­nif­i­cant jump . . .

One other trend we noticed is that CPCs on Google have sta­bi­lized. For the past two years, Google CPCs fell on a year-­over-­year (YoY) basis due to the increase in mobile and tablet traf­fic where CPCs were lower. How­ever, for the first time in seven quar­ters, the CPCs on Google are flat YoY and we antic­i­pate that CPCs will rise on a YoY basis again start­ing next quar­ter . . . 

Seeking to rebut the perception that the company has successfully manipulated the system to boost its own revenues, Google disputes the assertion that rising prices are inevitable. The company told Search Engine Land earlier this week: 

There have been many speculative reports, but it's far too early for any of them to be reliable. Advertisers will choose their bids and adjust their spend based on the value they see in their campaigns.

Is Mobile the Answer to: 'Half of Online Ads Are Never Seen'?

By now you've no doubt read about the comScore data that showed (or argued) just over half (54%) of PC display ads are never seen by users. The finding turns the old Wanamaker "Half the money I spend on advertising is wasted . . ." quote on its head: digital advertising is just as "wasteful" (if not more) than traditional advertising.

Last year, using the same "viewability" methodology, comScore reported that "31% of ads were not in-view, meaning they never had an opportunity to be seen." So the problem is apparently getting worse.

The IAB said that display ads (not counting video) in 2012 represented 21% of the $36.6 billion in US online ad spending. They contributed $7.6 billion at least to the overall pie. If half of that is wasted because ads cannot be seen or are never served it means $3.3 billion is being flushed down the digital toilet, so to speak.

Comparing the impact of PC vs. mobile display advertising across key brand metrics

Source: Dynamic Logic

Enter mobile advertising. I've argued multiple times in the past that mobile is a superior "branding" medium to online for various reasons, not the least of which is improved performance metrics over PC-based digital ads (see graphic above). The chief problem is that most of mobile display features weak ad creative, compromising the potential efficacy of the ads.

To counter this the IAB is releasing a mobile creative "manifesto" of sorts that hopes to instruct brands and agencies about the importance and hallmarks of effective mobile ad creative: A Mobile Manifesto: Creative Leaders on the Art of Successful Mobile Brand Messaging. It features hypothetical examples of best and worst practices.

Here are the broad strokes of the report's recommendations:

  • Clear and persistent branding is important for building brand awareness
  • Short, focused messaging plays well in mobile’s small format
  • A striking color palette can drive ad recall, but legibility is paramount
  • Consumers respond to mobile ads that give them something back

Many of these recommendations are merely "common sense." However even now many mobile display ad campaigns are perfunctory at best with converted or automated ad creative from PC campaigns. Thus marketers and brands are missing out on the true potential of mobile advertising by not making a "sincere" effort to maximize the value of mobile campaigns.

Study: Mobile Users Want to Be Paid for Their Attention

A new study jointly conducted by Millward Brown and mobile loyalty platform SessionM finds that consumers want a clear "value exchange" or "tangible benefits" for their time and attention to mobile ads. The study was fielded earlier this year among two survey groups of 500 US adults and combined with qualitative follow-up interviews.

A primary finding of the study, which echoes Nielsen "consumer trust" data from previous research, is that only 9% of users have a favorable view of mobile ads. Despite their typically superior performance on brand and other KPIs, consumers generally report unfavorable views of mobile advertising in surveys such as the SessionM-Millward Brown study: 

The study argues that mobile ads need to deliver "tangible value" in order to gain consumer engagement. When they do they can outperform other types of digital and mobile advertising. SessionM says that tangible value has three components: "being useful, entertaining and worth the time it takes to engage." 

What this means as a practical matter, according to the study, is offering a literal reward for consumer attention (e.g., coupons, points), although people respond to other types of "incentives" as well as ads that are more "relevant" (e.g., local, personalized). 

The following were the preferred reward types according to the survey:

  1. Gift cards
  2. Coupon or discount of your choice
  3. Coupon or discount selected for you
  4. Tickets for Events
  5. Points towards contest entries
  6. Donations to Charity
  7. Virtual Currency
  8. Access to ad free environment
  9. Access to free videos or songs
  10. Access to free games
  11. Access to exclusive content

Essentially people are saying they want to be paid to look at and engage with mobile ads. It's important to note that the study argues in favor of the types of advertising and marketing that SessionM provides: incentive and reward-based mobile loyalty programs. However other data show that consumers do respond to coupons and discounts at higher rates than other categories of mobile advertising. 

Survey: Why People Shop Locally, Price-Matching Works to Stop Showrooming

In April Harris Interactive conducted an online consumer survey about "showrooming" and related consumer attitudes about online and offline buying. The survey had 2,114 respondents, 824 of whom said they had showroomed: "ever visited a brick and mortar store to examine a product before purchasing it elsewhere online."

Accordingly 39% of the April 2013 survey population had engaged in showrooming at some point. That's actually down from 43% in November 2012 according to Harris.

Best Buy, Wal-Mart and Target are the three major US retailers that are most often "victimized" by showrooming, though the order is different for men and women. This compares to a study (tracking actual store visits) with slightly different results, conducted in February by Placed:

gender showrooming index

According to the Harris study Amazon is by far the most-used online comparison point for in-store smartphone shoppers. A relatively small percentage also or alternatively consult eBay.

Harris also found that price-matching strategies being adopted by retailers are likely to succeed in combatting showrooming. A large majority of those who said they had "showroomed" also said this policy would make them more likely to buy in stores:

Price matching in stores

Source: Harris Interactive (4/13)

Survey respondents simultaneously indicated they like the option to "buy online and pick up in store." In terms of same-day delivery from an e-commerce provider, however, a majority (77%) said they would NOT be willing to pay more for the service. For those willing to pay the majority (56%) said between $1 and $5 was a tolerable range.

The survey also affirmed many of the familiar reasons that people prefer to shop locally vs. online:

  1. Being able to take the item home immediately (86%)
  2. Taking advantage of sales in store (84%)
  3. Not having to deal with the hassles of returning online such as paying for shipping and/or having to pack item (83%)
  4. Ability to touch and feel item (83%)

Being able to "talk with a salesperson" in stores was only valued by 57% of survey respondents. Indeed, a majority (60%) strongly agreed that they "would rather use [a] smartphone to search for information about a product than ask a salesperson for help."

I suspect the latter finding is a result of years of experiences with low-paid and generally poorly trained salespeople in retail stores.

Five US Companies Will Control 76% of Global Mobile Ad Revenue in 2013

Last year, according to the IAB, mobile ad revenues came in just under $3.4 billion in the US. On a global basis eMarketer (aggregating a range of third party data) estimates that mobile advertising was worth $8.8 billion. Of that Google was responsible for a staggering 52%. 

In 2013 eMarketer argues that Google's share of global mobile advertising will continue to grow to 56%. 

Screen Shot 2013-04-16 at 8.04.50 AM

Source: IAB 

Impressively or shockingly, nearly 66% of global mobile ad revenue in 2012 was concentrated in the top five companies according to eMarketer. In 2013 that figure is expected to exceed 75%.

The eMarketer forecast is that this year mobile advertising will be worth nearly $16 billion worldwide. In other words, roughly $12 billion of the world's mobile ad revenue will be concentrated in the top five US-based companies -- and most of that at Google. 

By comparison, the top 10 PC-based online advertising companies in the US control 72% of the revenue, while the top 50 control nearly 90%.

Source: IAB  

The eMarketer numbers may well be off. For example their YP figures are incorrect and underestimate the company's mobile revenues for 2012. However directionally the numbers are accurate and indicate the "concentration of mobile weath" in a small number of companies -- as well as the dominance of Google as the world's largest mobile ad company. (In terms of total digital advertising globally, Google controls 33%.) 

Facebook is really the only other player currently in a position to challenge Google for mobile ad revenue and reach. 

Pew: 81 Million US Adults Own Tablets

According to telephone survey data (n=2,252) released this morning by The Pew Internet & Life Project, 34% of US adults now own tablets. What that means as a practical matter is: 81 million adults. There may also be 20 million more people in the US under 18 who own tablets. (Our house has four.) 

I think it's relatively safe to say that if the number of tablets in the US isn't yet 100 million it's extremely close.  

A large majority of tablet owners are substituting tablets for PC usage in many instances and either buying fewer PCs overall or delaying PC replacement for a much longer period. This morning Apple will open its developer conference. A upgraded iPad/Mini is not expected to be among the announcements but it's possible. 

. Pew tablet ownership

As with other device categories, the story is largely the same with tablets. Penetration rates are higher among college educated (49%) and more affluent adults (56%). Affluent means at least $75,000 in income.   

The chart above reflects the growth of tablets since 2010 when only 3% reported tablet ownership. It's possible that by Q4 of 2014 half of the US adult population will have tablets (and 75% of affluents).

Global tablet shipments this year are expected to exceed those of laptop computers according to IDC. IDC also argues most of those sales will be at the lower end of the market (size, price).

Last week both Pew and Nielsen reported that 61% of mobile subscribers now own smartphones.  

It's Official: 61% of US Mobile Subscribers Have Smartphones

Earlier this week survey data from the Pew Internet Project argued that 61% of US adult mobile subscribers now own smartphones. Today Nielsen announced agreement with that number:

More than three out of five (61%) mobile subscribers in the U.S. owned a smartphone during the most recent three-month period (March-May 2013), up more than 10 percent since smartphones became the mobile majority in early 2012.

Comscore, for its part, says that the percentage of mobile users with smartphones is slightly less: 58%. Overall we're talking about 140 - 150 million people in the US now with smartphones.

In terms of OS market share, Nielsen reports that Android has 53% of the US smartphone market, while Apple controls 40%.

By comparison comScore says that it's 52% (Android) to 39% (Apple). Kantar (a market research division of WPP) shows a generally similar set of market share metrics for Android and iOS (iPhone).

comscore smartphones April 2013 US market

Source: comScore 

Kantar mobile market share data

Source: Kantar Worldpanel ComTech  

Where these market-share data disagree is with respect to Windows and BlackBerry. Nielsen says Windows Phone has 2% of the US smartphone market, while comScore says it's 3% and Kantar says it's closing in on 6%. 

If we look at actual web traffic in the US, the relationship between Android and iOS flips. (Here iOS may well include the iPad.) Internationally Android is ahead.

The following are StatCounter data showing traffic being driven by each of the major mobile operating systems:

US market:

  • iOS: 54%
  • Android: 40%
  • Windows Phone: 1.3%
  • Other: 4.7%

Globally:

  • Android: 38%
  • iOS: 26%
  • Symbian: 8%
  • BlackBerry: 3.5%
  • Windows Phone: 1.3%
  • Other: 23%