Instagram Tells Us Mobile Phones Are For Communication At News Event

Julie Ask

Instagram’s ‘Instagram Direct’ announcement this morning left me speechless, as I followed the live feed (thank you CNET) from the West Coast. First, let me disclose that I am middle-aged. I’m 45 years of age. What does this mean? I remember AIM in the late nineties. I remember the days when chat sessions evaporated. I remember my first cell phone in 1997 and texting my friends – mostly in Europe at that time. The idea of communicating with people I know first and foremost is not new to me. It is very comfortable – more so than Tweeting or posting.

Bottom line: This is a “catch-up” move for Instagram.

1) Mobile phones have always been about communicating with friends and people we know. The magic of mobile phones early on was that a person’s phone number was their ID. It made it so easy to send SMS or MMS messages.

2) Instagram has 150M downloads, and half of their users are active daily. That is awesome. However, its competitors globally – Kakao Talk, WeChat, etc. – have two to three times that number. Apps like WeChat already allow users to share videos, photos, messages, cartoons, voice clips, etc. to individuals, groups, groups created around an event, etc.

3) Messaging will help them earn more mobile media minutes. I spoke with Chris Hill at Mobidia last week, and he shared some of their data on usage minutes. In their sample from mid-October, Kakao Talk had more than 200 minutes of usage per week, WhatsApp was just shy of 200, while Kik Messenger, LINE, and WeChat fell just below 100 minutes of use per week. If they were to post ads as a means of monetization, minutes spent is key.

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Despite Impressive Growth, Facebook Is Facing Mobile Ad Challenges

Thomas Husson

Facebook now has 819 million mobile monthly active users. That’s a huge audience. That’s actually 71% of total active users.

Yesterday, Facebook reported they generated 41% of total ad revenues via mobile. That’s pretty impressive considering they generated nearly 0% end 2011 when they had already 432 million mobile monthly users. Since the launch of mobile ads in 2012, Facebook steadily increased the share of mobile in total ad revenues: it was 23% end 2012 and 30% in Q1 2013.

There is still a monetization gap in comparison to the share of their mobile audience, but that’s definitely impressive for a new product.

There are a couple of reasons for this sharp increase.  Time spent on Facebook is meaningful. Facebook’s mobile ads integrate well in the natural flow of Facebook’s news feeds. They are quite visible and are increasingly successful at driving mobile app installs. According to our European Technographics Consumer Technology Online Survey, Q4 2012, 16% of online adult smartphone owners (ages 16-plus) who use apps report that they first learned about an app via social networking websites such as Facebook. No wonder why the likes of Fiksu and other app boosters spent a lot of money on Facebook mobile ads.  Cost per click increased despite a lot more clicks and ads shown.

For this approach to be successful in the longer term, there are a couple of key questions to be answered:

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LeWeb 2012 Preview: The Internet Of Things, The Always Addressable Consumer, And Privacy Concerns

Thomas Husson

It's that time of year again: Tomorrow, venture capitalists, entrepreneurs looking to raise funds, journalists, bloggers, geeks, and digital executives from all over the world will be gathering at LeWeb in Paris. For a couple of days, Paris will turn into the digital Mecca.

A lot of the media and investor attention will focus on the now-traditional startup competition, looking for the new Evernote, Instagram, Nest, or Withings. Here’s the list of the 16 semi-finalists. Emblematic of the entrepreneurial spirit of the conference, David Marcus, founder of startups like Punchd (acquired by Google) and Zong (acquired by eBay) and now CEO of PayPal, will be speaking at the event and will cross paths with a long list of digital visionaries and key executives, such as Pascal Cagni, former general manager and VP of Apple EMEA.

Here are some of my observations on this year's theme — The Internet of Things — as well as a summary of some of Forrester’s latest research on this quickly evolving space.

 

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