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%).
Yesterday comScore released its US smartphone market share report for August. The interesting thing is that these data do not reflect the release of the iPhone 5s and 5c. Apple was the single most popular handset maker, with just under 41 percent of the market. Samsung was second with 23 percent.
In terms of operating system share, Microsoft gained 0.2 points while Android lost 0.8 points. The iPhone saw a 1.5 percent gain. It certainly will be interesting to see what the September numbers are, post iPhone 5s.
In the aggregate Android devices represent just over half the smartphone market in the US (now 64% of mobile users). However it appears that may be the ceiling for Android -- at least for the time being.
Depsite this it appears from comScore's data that Google has achieved nearly 100% (92%) smartphone reach in the US through a combination of apps and mobile search usage, though Facebook remains the top individual mobile app:
According to research conducted by investment bank Canaccord Genuity the iPhone 5s was the top selling mobile handset at each of the four major US carriers in September, with the 5c taking second place at AT&T and Sprint and third place at Verizon.
Notwithstanding its second place finish, the 5c is quite a bit less popular than the 5s. Hitwise (Experian) reported that search queries for the iPhone 5s were 4X more than the 5c in early September.
This basically mirrors our survey finding correctly predicting the enormous popularity of the 5s and lesser interest in the 5c:
Source: Opus Research, n=1,508 US adults (Sept 16 - 19 2013)
Elecontrics retailer Best Buy is offering a $50 instant discount on the 5c, which effectively cuts its contract-subsidized price to $50 for the entry level device. Wal-Mart by the same token has cut the 5c's price to $45 "permanently." This should help boost sales of the 5c considerably in the short term.
As you're aware Twitter filed its public S-1 statement this afternoon. There's a great deal of interesting material in it. The company said that in 2010 revenue was roughly $28 million. Last year it was $317 million. This year it could well exceed $500 million, reflecting triple-digit ad revenue growth.
The following are the important mobile-related stats disclosed in the S-1 filing (mostly verbatim statements):
In 2010 74% of Twitter's revenue came from data licensing and the remainder from ads. In 2012 85% of revenue came from ads and 15% from data licensing, reflecting a huge shift in the sources of revenue for the company.
Given that Twitter has a still relatively small number of users in the US and internationally there's plenty of room for growth -- domestically and abroad.
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.
Arguably the most interesting thing about the new Kindle Fire "HDX" tablets is the so-called "Mayday" button. By pressing a single button HDX owners will see a live human appear in a pop-up window on their screens, as the picture to the right illustrates.
That individual can answer questions and perform diagnostic functions or fixes remotely. And while Amazon Kindle users can see the agent, the customer support person cannot see the Kindle owner (thereby preventing certain unseemly "chatroulette scenarios"). Amazon says most questions or issues are or can be resolved in relatively little time. Live support is free/included and available "24x7, 365 days a year."
One review of the HDX questioned how scalable this service is. I suspect it's pretty scalable, especially if they offshore the support centers. But given that one can see the person on the other end of the line, offshoring may be less viable for something like this. In his post on the Opus Research Web site, my colleague Dan Miller sees the potential for a speech-enabled, automated personal virtual assistant to populate the agent screen.
My hunch is that Mayday will become a premium service or included with a Prime subscription ultimately.
What's more interesting to consider is how Mayday might become a new model for customer service and/or sales support for tablet and mobile apps. Think about how much more e-commerce and conversions might happen if live support were available. In a mobile context "chat" doesn't really cut it.
There are various in-between scenarios possible too, where a static image might be used instead of video together with a VoIP call. That would be the "low rent" version but it could be equally effective if executed properly.
The success of Mayday and its emulation or replication by others would be a new spin on and give new meaning to the notion of the "personal virtual assistant."
Kantar Worldpanel ComTech has released new smartphone market share data showing significant gains for Windows Phone in Europe. The research firm says that Windows Phone is now within a point of the iPhone in Germany and that its growth is outpacing Android across the Continent:
Android remains the top operating system across Europe with a 70.1% market share, but its dominant position is increasingly threatened as growth trails behind both Windows and iOS. Windows Phone has hit double digit sales share figures in France and Great Britain with 10.8% and 12% respectively – the first time it has recorded double digits in two major markets.
Kantar also says that Apple is continuing to show momentum in the US: "Apple continues to grow strongly year on year and now makes up 39.3% of sales." These data do not include the recent 9 million handsets sold by Apple upon the debut of the iPhone 5s and 5c.
Windows Phone's strongest markets are France, UK, Germany and Italy, where Nokia's brand is still relatively strong. It continues to lag in the US and China, however.
Technology and internet companies have supplanted traditional brands at the top of Interbrand's annual "Top 100 Global Brands" list. Apple and Google are number 1 and 2 on the list respectively, beating out perennial winner Coke and others such as IBM, Disney, Microsoft and GE.
Notwitstanding its beating at the hands of investors and doubts about its future performance, Apple was picked by Interbrand as the world's "most valuable brand" for 2013. Google was last year's number 4.
Facebook is number 52 on the list and Amazon comes in at number 19. Yahoo and BlackBerry dropped off the list entirely this year and Nokia "experienced the largest decline in brand value" in the 13 year history of the report. The top 15 on the list are below.
Interbrand determines its annual ranking using a formula that combines:
Apple's rise to become the world's most valuable brand is striking. Interbrand says the Apple brand is currently worth $98 billion, which is considerable but much less than the company's overall market cap of $435 billion. According to Interbrand:
Apple has appeared on Interbrand’s Best Global Brands ranking since 2000, when the ranking debuted. In 2000, Apple ranked #36 and had a brand value of USD $6.6 billion. Today, Apple’s brand value is USD $98.3 billion– almost 15 times the amount of its brand value in 2000. Apple’s meteoric rise in brand value can be attributed to the way it has created a seamless omnichannel experience for customers. By keeping consumers at the center of everything it does, Apple is able to anticipate what they want next and break new ground in terms of both design and performance. With 72 million Macs in use and record-breaking sales of both the iPhone and iPad, Apple has made history by unseating Coca-Cola and becoming Interbrand’s most valuable global brand of 2013.
When Amazon introduced its original color tablet the Kindle Fire its chief innovations were aggressive pricing ($199) and the fact that the company used a "forked" version of Android that declared its independence from Google. There have since been two updates to the line (including yesterday's), which now includes four color tablets.
Yesterday Amazon CEO Jeff Bezos introduced refreshed Kindle hardware and software. There's a new "operating system," called Mojito (based on Android Jelly Bean). There are essentially two new tablets: Kindle Fire HDX (as in "beyond HD") in 7 and 8.9 inch versions. The Kindle Fire HD (7 inch) has been dropped to $139, which is sure to be the biggest seller, though it's effectively last year's model. There's also a clever new cover/stand called Origami.
The big software innovation is "Mayday," which is live video tech support on the tablet screen. Here's how Amazon describes it:
Kindle Fire HDX also introduces the revolutionary new "Mayday" button. With a single tap, an Amazon expert will appear on your Fire HDX and can co-pilot you through any feature by drawing on your screen, walking you through how to do something yourself, or doing it for you—whatever works best. Mayday is available 24x7, 365 days a year, and it's free.
As a practical matter Mayday is mostly a marketing gimmick, which probably won't see a great deal of actual use but will give some confidence to older and less tech-savvy buyers. What's more interesting to consider is the degree to which Mayday may be emulated by other industries (e.g., travel, shopping) for customer care purposes. That will be fascinating to watch.
North American Non-iPad Traffic Share
Source: Chitika, September 2013 (North American Android tablet traffic share)
Currently in North America the iPad controls about 84% of tablet-based web traffic according to Chitika. The remaining 16% is mostly Android tablets and really a battle between Amazon, Samsung and Google (in order of market share). The $139 price point on the Kindle Fire HD will capture buyer attention and may put pressure on Samsung and Google.
When Google introduced its new Nexus 7 earlier this year the company raised the price from $199 to $229 for the entry level model. The price increase was justified on the basis of new specs and a higher resolution screen. Amazon's Kindle Fire HD is almost $100 cheaper at $139. Without ads it's $154. The Nexus 7 is a superior device (to the Kindle Fire HD) but many people will not see a difference and opt for the much cheaper Kindle.
The Samsung Galaxy Tab 3 is $199. Accordingly it will be very challenging for Google, Amazon or anyone to sell many smaller tablets at much above a low $200 price point. Whether the iPad Mini feels similar pricing or sales pressure is a question that remains to be answered. However I suspect iPad Mini sales will only be affected at the margins.
There was an initial surprise yesterday that Apple had sold 9 million iPhones over the weekend. Since the smoke cleared, however, there has been considerable "day two" analysis of those sales. Mobile analytics firm Localytics, for example, has done a geographic breakdown of global activations and traffic iPhone 5s and 5c devices in the past 72 hours.
According to the company's analysis, the majority of overall new iPhone sales have been in the US, followed by Japan and the UK.
Though a still small market for the iPhone in absolute sales, China is significant in that the Chinese seem to be buying the 5s in much higher numbers than the 5c. This is something of a suprise considering that the price of the 5s in China exceeds $800. The now sold out gold version is selling on the grey market, according to several reports, for more than double that.
In the US, roughly 3 out of every 4 iPhones sold is a 5s. Internationally, Localytics says that more than 80% of new iPhones sold are 5s devices.
Our survey, conducted a week ago among 1,500 US adults, correctly predicted high demand for the 5s as well as the 5s to 5c ratios.
What's interesting is that even in the face of massive weekend sales, the perceived weakness of the 5c is keeping Apple's stock down and fuelling the bearish Apple-investor narrative that the company has lost its old magic.
Perhaps surprising was that of the eight countries where the most iPhone 5s’ or 5c’s were sold, the highest ratio of preference for the 5s wasn’t in the United States or Japan; leading the pack is actually China.
One possible explanation: there was a lot of hoopla around the addition of the gold-colored iPhone 5s as a very attractive addition in particular for Asian markets so this hypothesis may hold true. Keep in mind the gold-colored version is only available on the 5s, not the 5c.
Other major markets also had a very high ratio of the 5s vs. the 5c. In fact, the only country that didn’t have at least a 3 to 1 ratio of the 5s vs. the 5c was the United Kingdom. With the economy in the UK still in recovery, a slightly less strong affinity for the 5s could be the result of a more cost-conscious buyer. Subsidies also play less of a role in the UK’s phone market than in the US, making the upfront cost of phones higher for consumers. Globally the iPhone 5s represented 78% of all of the new iPhone 5s and 5c devices; 76% in the U.S. and 82% in the rest of the world.
One possible reason why more iPhone 5s’ were sold was because of the tendency of hardcore apple users wanting to buy the top of the line iPhone on the weekend it was released. It will be interesting to see if the 5c can pick up a bit of momentum in the next few weeks.
iPhone 5s & 5c Adoption by Country
Overall, the United States accounts for 68% of all active iPhone 5s and 5c devices worldwide, with Japan in second place with 13% of 5s and 5c’s.
- See more at: http://www.localytics.com/blog/2013/china-leads-the-pack-in-preference-for-iphone-5s-over-5c/#sthash.tVuxOsR6.dpuf
Several years ago many analysts projected that “mobile payments” and “mobile wallets” would become massive, multi-billion-dollar markets. With the exception of mobile e-commerce, it hasn’t happened.
The term “mobile payments” is used loosely to refer to a range of different types of activities. However imprecise use of the term creates confusion and widely varying assessments of the outlook for “mobile payments.” What we mean here by “mobile payments” is more specific: using a smartphone (and associated apps) as a credit card or wallet replacement in the real world.
That was the concept behind near-field communications (NFC) based Google Wallet. The assumption was that Google’s clout and visibility would propel both NFC and Google Wallet into the mainstream. However, two years later it’s safe to say that Google Wallet, at least as originally conceived, has failed.
By contrast, so-called "m-commerce" and mobile payments through specific apps have shown increasing momentum. But the broad concept of a "horizontal" mobile wallet remains mostly undesirable to US consumers (at least in the abstract).
A year ago Opus Research surveyed roughly 1,500 adults to determine their awareness and demand for mobile wallets. The question was: “How interested are you in using you mobile phone to pay for things and replace cash or your credit cards?” There were four potential responses. In order of waning enthusiasm they were:
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Apple announced this morning that it had sold more than 9 million iPhone 5s and 5c devices this past weekend. It did not indicate how many of the 9 million were 5c devices vs. 5s devices. Most of the demand globally is likely to have been for the 5s. That's what our survey showed (see below).
The market became very nervous after the 5c went on sale for pre-orders a week ago and Apple didn't issue a press release last Monday. Many institutional investors sold Apple shares. Then the very postive 5s reviews came out stoking consumer demand.
Here's what Apple said in its release this morning:
Apple today announced it has sold a record-breaking nine million new iPhone 5s and iPhone 5c models, just three days after the launch of the new iPhones on September 20. In addition, more than 200 million iOS devices are now running the completely redesigned iOS 7, making it the fastest software upgrade in history.
Essentially the 5s sold out of its initial supply.
Source: Opus Research, n=1,508 US adults (Sept 16 – 19 2013)
Last year Apple said it had sold 5 million iPhones during its first weekend. That was a record at the time. This nearly doubles it. The company also announced this morning that since iOS7 became available late last week, 200 million devices around the world have been upgraded.
I was concerned that I would dislike or be ambivalent about the new OS. However I actually like it quite a bit.
The iPhone 5s sellout will only fuel further demand for the device. Supplies of the 5c remain available. But the public seems to recognize the 5c as "last year's model" with a new coat of paint. While that's not entirely true (there are some upgrades) demand for the 5c has been much less than the 5s as our survey last week predicted.
Update: Localytics now answers the 5s vs. 5c sales question, saying that the 5s outsold the other device by a factor of more than 3X in the US and an even larger margin outside the US:
According to the Wall Street Journal, "PayPal is near a deal to buy Braintree Payments Solutions." Braintree has had great success as a payments platform and processor both for e-commerce and in mobile.
Braintree is behind payment processing for companies such as Uber, AirBnB, LivingSocial and OpenTable among others. The company has roughly 4,000 customers according to the WSJ piece.
Braintree processes roughly $12 billion in payments annually, about $4 billion of which come from mobile commerce transactions. PayPal, by contrast said that it would process roughly $20 billion in mobile payments in 2013.
The deal would help further accelerate PayPal's mobile business. PayPal would also acquire Venmo, a P2P payments aoo, that Braintree bought in 2012 for just over $26 million.
Among mobile wallet/payments companies PayPal is far and away the best-known brand, though US consumers still show relatively little interest in generic "mobile wallets," according to our survey data.
Google Wallet has largely failed to date and other "mobile wallets" and mobile payments providers are almost totally unknown to the public. This deal would help cement PayPal's leadership in mobile payments.
Recently PayPal introduced Beacon, a Bluetooth low energy (BLE) in-store payments and indoor-location solution that is helping, together with Apple, show NFC the door in North America.
On September 10, Apple formally unveiled the long-anticipated iPhone 5s and the rumored iPhone 5c. The 5c takes the place of the current iPhone 5 in Apple’s iPhone line-up. It’s essentially the same device with a few upgrades and a colorful polycarbonate exterior. The 5c is $100 less expensive than the “flagship” 5s. Speculation about what the “c” stands for has ranged from “cheap” to “China” and “color.”
On September 13, the 5c became available for pre-order (Apple isn’t allowing pre-orders of the 5s). Analysts and journalists had expected a triumphant press release the following Monday. But no such release came, leading to speculation that the 5c was a dud and had failed to generate significant pre-orders.
This weekend Apple launches the 5s amid rumors of "severly constrained" supplies.
Rather than wait for an official press release on September 23, we ￼conducted an online survey of 1,508 US adults between (September 16 and ￼September 19) to assess demand for the new iPhones vs. competitors. ￼￼We asked survey respondents, “Which of the following [handsets] would you like as your next ￼mobile phone?” They were permitted to select a single answer from a ￼randomized list of options.
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Today 91% of American adults own mobile phones according to new data from The Pew Research Center. More than 61% (64% per Nielsen) own smartphones. In this latest survey Pew takes a look at common activities on mobile devices (including non-smartphones).
Pew found that 81% of mobile phone owners text, the most common activity, while 60% access the internet. Just under half (49%) use maps or access location-based information on their handsets. All these percentages are higher if non-smartphones are excluded.
There are approximately 250 million US adults today. If 91% own mobile phones that means about 228 million adults in real numbers. Of that group about 146 million own smartphones (per Nielsen's 64%). If kids and teens are added in we easily have in excess of 150 million smartphones in the US market.
If 60% of adult mobile phone owners in the US access the internet that would be roughly 137 million people (not counting teens and kids).
Among the 60% going online from their mobile handsets (not including tablets) Pew says the following:
African-Americans and Hispanics are more likely to do so than whites. Younger adults, those with at least some college education, and those with an annual household income of over $75,000 a year are particularly likely to access the internet via cell phone. Those who live in rural areas are less likely than urban or suburbanites to have mobile internet access. Among those who use the internet or email on their phones, more than a third (34%) say that they mostly access the internet from their phone.
A recent Nielsen study found that 46% of US survey respondents relied exclusively on smartphones or tablets in conducting online research across a range of categories (i.e., retail, banking, gas and convenience). That same study found that, in the banking category, more than 50% of smartphone and tablet users did not use a PC to make purchase decisions (e.g., about credit cards).
What we're thus seeing is the emergence of a "mobile first" population in the US, which may be 50 million people on the low end and 75 million on the high end.
The first wave of iPhone 5S reviews have come out and they're essentially raves, exemplified by Walt Mossberg's superlative laden missive: “[T]he new iPhone 5s is a delight. Its hardware and software make it the best smartphone on the market.”
While there is some question about the early success of iPhone 5C pre-orders, the 5S is almost a sure sellout when it's released this weekend. According to a survey by Opus Research, the 5S is the most desired "next smartphone" available in the US market, while the 5C is in fourth place (after Galaxy and other Android devices).
However according to new data from Nielsen, 61% of recent smartphone buyers chose Android devices vs. 34% who bought iPhones. We'll see how those numbers are impacted, if at all, by the launch of the 5S.
Overall Nielsen says that in the US 64% of mobile subscribers are now owners of smartphones. Those in the 25 - 34 age group have the highest smartphone penetration at 81%, with teens 13 -17 closing in at 70%. Feature phones are now concentrated among those over 55 years of age.
Below is the current smartphone OS market-share distribution according to Nielsen:
As I wrote last week the advent of iBeacon and bluetooth low energy may effectively mean that NFC as an in-store mobile payments standard in the US market is dead. Google Wallet had placed a big bet on NFC payments but has been thwarted in its bid for adoption by two principal factors:
Google Wallet 1.0 thus was a failure. Google is now out with a new Android version (and soon iOS) is making a renewed bid for consumer adoption with a range of new features and a partial move away from NFC. In-store payments still depend on NFC and so won't be happening at scale any time soon for the same reasons cited above.
However the new features add utility and breadth to the user experience. Here's what's new:
Exactly a year ago we surveyed 1,501 US adults and found the vast majority were not interested in the idea of mobile wallets: 71% said "I'm not at all interested . . . in using [my] mobile phone to pay for things and replace cash or credit cards." Another 15% said they had only "limited interest." Only 14% had some interest or significant interest.
In specific contexts, where consumers see the tangible benefits of mobile wallets, these numbers change. But in the abstract the public remains largely uninterested in mobile wallets.
This morning the Pew Research Center released new survey data about mobile internet access. According to the findings, 93% of smartphone owners (and 63% of all mobile phone owners) go online with their handsets. Tablet usage was not part of this survey.
The most interesting finding, however, was that 34% of all those who go online with their phones do "most" of their internet browsing via mobile:
One third (34%) of cell internet users say that they mostly use their cell phone rather than some other device such as a desktop or laptop computer . . . Half (53%) of cell internet users say that they mostly go online from a device other than their cell phone, while 11% say that they use both their phone and some other device(s) equally.
Pew told me in email this number was basically the same percentage for smartphone and non-smartphone users.
Those who are "mostly mobile" include "young adults, non-whites, the less educated, and the less affluent." This is highly analogous to those who have a mobile phone but not a landine (or who essentially don't use a landline).
Nielsen's recent Mobile Path to Purchase study (sponsored by xAd, Telmetrics) found that in certain categories the "mostly mobile" or "mobile only" internet population was nearly 50 percent (or above 50% in the case of online banking). Indeed, in specific segments or verticals (e.g., Local) the numbers may exceed 50%. For example:
What we're witnessing is the rise of an audience that may not use the PC at all in certain cases or use it purely as a secondary matter. As a counterpoint, see the recent comScore-Jumptap data that show people prefer larger screens in many instances.
Once more sites and internet experiences are better optimized for mobile devices, however, we may see an accelaration of this mobile-first/mobile-only trend.
Last week news broke than McDonald's is considering rolling out mobile payments. Currently the McDonald's app is primarily a store locator. The app also offers nutrition information.
According to a Bloomberg report, the company has been testing mobile payments in Salt Lake City, Utah and in Austin, Texas. McDonald's has roughly 14,000 US stores and 35,000 globally.
Mobile payments would allow McDonald's patrons to pre-order meals online and then pick them up at the drive-thru window. Other fast-food chains have tested, are testing or now using mobile ordering/payments. The McDonald's app will also feature deals and rewards according to Bloomberg.
A mobile ordering/payments capability may also help McDonald's attract younger users and Millennials, who are less inclined than others to visit the QSR chain. According to an AdAge write-up of an NPD Group survey:
Millennials are indeed going to burger chains, but they are going less often. The hamburger category, which includes McDonald's, Wendy's and Burger King, still receives 29% of all millennials' quick-service visits, according to NPD, more than any other restaurant category. Fast casual, which includes chains like Chipotle, gets 6% of millennial quick-service traffic.
But hamburger chains have seen a 16% decline in traffic from Millennials since 2007, NPD said. In the year ended November 2012, Millennials made 3.6 billion visits to hamburger chains, down from 4.2 billion visits in the year ended November 2007. There was a 12% decline in quick-service restaurant visits by Millennials in the same time period.
Ultimately all QSR chains will offer mobile ordering/payments. And that will help acclimate a generation to using their smartphones as wallets to pay for things.
Once people are familiar and comfortable with mobile payments in a specific context (e.g., ordering food) they will be more inclined to embrace them in other scenarios.
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.
Nokia's Lumia handsets represent about 80% of Windows Phone's sales. However Nokia was continuing to lose share to Android and iPhone in key markets across the globe. By the same token Windows Phones had failed to enable Nokia to re-enter the US smartphone market in any convincing way.
Since the inception of the Microsoft-Nokia deal in early 2011, we had been arguing it was a serious mistake for Nokia to not offer an Android phone. However the terms of the agreement between the companies precluded that. In 2014 the deal was set to expire. But before that deal was renegotiated, Microsoft acquired Nokia's phone hardware business for roughly $7.2 billion.
In the middle of last year we speculated that Microsoft might be compelled to acquire Nokia for defensive reasons. When the acquisition was announced a little over a week ago, I argued had Nokia embraced Android it would not have been so weakened and forced to sell itself. I also speculated this summer that Nokia would be compelled to come out with Android handsets if it wanted to survive:
My view is that Nokia will be compelled -- notwithstanding contractual exclusivity with Microsoft -- to adopt Android at some point in the not-too-distant future or remain stuck in what amounts to neutral.
Now the NY Times is reporting that Android Lumia phones were in development:
A team within Nokia had Android up and running on the company’s Lumia handsets well before Microsoft and Nokia began negotiating Microsoft’s $7.2 billion acquisition of Nokia’s mobile phone and services business, according to two people briefed on the effort who declined to be identified because the project was confidential. Microsoft executives were aware of the existence of the project, these people said.
There are two overlapping potential scenarios: Nokia was developing Android handsets in part to add leverage in negotiations with Microsoft (for renewal or acquisition); and/or Nokia was developing Android handsets in earnest and would have rolled them out -- forcing Microsoft to avoid that outcome through an acquisition.
Regardless it appears that the idea of Nokia marketing both Android and Windows Phones was a potential disaster that Microsoft sought to avoid at great cost -- literally. As I've written elsehwere, however, it remains unclear that Microsoft's $7.2 billion have been well spent.