Mobile phones have changed not only the way we live and communicate. They have also changed the way we think. Customers have experienced a mind shift: They expect any desired information or service to be available, on any appropriate device, in context, at their moment of need. Technologies packed in mobile devices enable people not only to instantly consume but also to create content and maintain greater control in their everyday lives.
Customers' behaviors are becoming as sophisticated as their devices. Mobile has become the new digital hub. According to our Technographics data, 47% of European online adults who own a mobile phone use mobile apps at least weekly. Forty-five percent browse the Internet at least weekly, and 38% search for information on mobile search engines, too. In the US, 50% of online adults who use a mobile phone use their devices to check sports, weather, or news at least weekly. Forty-five percent access social networks on their phones at least weekly, and 22% research physical products for purchase! This implies that you must have a mobile component for your digital strategy. But it goes beyond this, as mobile is bridging the offline and online worlds.
Yes, mobile is a hot topic. Reading the press or listening to conferences, you may be under the impression that marketers have embraced the mobile mind shift and are really integrating mobile into the marketing mix. A significant majority of marketers told us that their senior leadership team understands the importance of mobile.
In two recently published forecasts — Forrester Research Mobile Adoption Forecast, 2011 To 2016 (Western Europe) and Forrester Research Mobile Adoption And Sales Forecast, 2012 To 2017 (US) — we looked at mobile Internet usage across the US and 17 countries in Western Europe.* Tracking the evolution of mobile Internet usage allows us to understand changes in consumer behavior and to better understand such things as the rise of mobile commerce. We found that in 2011, less than one-third of mobile phone owners in Western Europe connected to the mobile Internet at least monthly; this equates to 100 million individuals. In the US, monthly mobile Internet penetration reached 114 million people, approaching half of handset owners. Even the UK, which is one of the leading proponents of mobile Internet usage in Europe, lagged the US, with less than 40% of mobile phone users connecting to the mobile Internet at least monthly.
European economic woes have almost certainly had an impact, but factors like higher smartphone penetration, competitive data plans, higher post-pay subscriber penetration, and the faster rollout of 4G networks and handsets in the US than in Western Europe help explain this difference. In 2011, more than 17 million US mobile phone users already had 4G compatible handsets compared with only 1.6 million in Western Europe.
Recently I published a forecast about mobile subscriptions and mobile subscribers (people) by region, worldwide. In 2012, more than half of the world’s population — around 4.3 billion people — will own at least one mobile handset. In emerging markets, where the penetration of landline phone connections has been low, the adoption of mobile phones has soared over the past five years. Mobile handsets are able to provide a cheaper and more convenient means of telecommunications access. They are breaking down barriers to entry — and have been received with welcoming hands and ears.
In the recently published Forrester Research World Mobile Adoption Forecast, 2011 To 2016 (Global), we break down the numbers and growth drivers for the adoption of mobile Internet across the globe. Many consumers who have not been able to go online will now get the opportunity to access the Internet due to declining mobile data costs. About a fifth of the world’s mobile subscribers are currently using their mobile handsets to go online. According to our research, the global penetration of mobile Internet users will exceed that of PC-based Internet users in 2016.
While it is no news that China leads the world’s online population, hitting 477 million users as of March 2011, it is interesting to look at the uptake of mobile Internet in urban China and see how that compares with other regions. Forrester’s Technographics® data shows that urban China is chasing Japan closely, with 43% of mobile phone users reporting they access the mobile Internet at least monthly. This number doubles that of the US (although the US number represents all Americans, rural and urban), which ranked as the third market in this study. While my gut feeling tells me that urban China’s mobile Internet adoption is comparable to that of the developed markets, this result is still striking because the smartphone market in China did not kick off officially until the end of 2009.
Just last month, China Mobile, the dominant mobile service provider with 60% national market share, announced its plan to lower rates for both calls and data plans by an average of at least 15%. And on Monday, China Daily reported that the number of China’s microbloggers was forecast to reach 100 million this year and will increase to 253 million by 2013.*
The booming popularity of microblogging in China, coupled with the fact that mobile Internet is becoming more affordable, means that urban Chinese will not forgo the convenience that mobile Internet provides. We know another wave of growth is approaching. It is just the matter of how high the wave can reach.
Having analyzed consumers' technology behavior for more than 11 years now here at Forrester, I've seen a certain pattern surface in the uptake of technology: When new technologies become available, it's Generation X (ages 31 to 44) that adopts it first, but it's Generation Y (ages 18-30) that runs with it. Gen Xers have money to spend on technologies when they're still premium-priced, but Gen Yers have the time on their hands to really explore all possibilities. For example, when we look at online activities, young consumers spend more time online and are involved in more activities (especially when we look at social networking). However, for mobile Internet, we see a different pattern emerge.
Forrester's Technographics® data shows that Gen Xers are equally active on their mobile phones, and in some instances, like playing games, they rival the usage of their younger counterparts. In other instances, like checking news, sports, or weather or checking travel status, Gen Xers actually outpace Gen Yers.
Companies that want to target these groups should ensure that their mobile Internet experience is consistent with the regular Internet presence, ensuring a seamless experience for their consumers. The Mandarin Oriental Hotel Group is a perfect example of a company that identified the mobile needs of its clientele and then created a unique experience that allowed users to effortlessly connect both through their mobile device and online.
Apps dominate the mobile conversation these days for a lot of well-demonstrated reasons, but with much less fanfare, the mobile Internet — especially the frequency of its users — has taken off. I don’t mean just that ‘mobile Web use has grown’ or it’s continuing to grow at steady pace. No. The rate of growth has jumped dramatically.
In the six months between year-end 2008 and mid-2009, daily use of the mobile Internet grew from 7% to 10% for all mobile phone users. Once you narrow it down and look at smartphone owners, the growth is even more startling, as you can see in this report. Better handsets, better browsers, and faster networks have remade the mobile Internet from a novelty to a growing, and growing quickly, part of mobile users’ daily lives.
One of the significant shifts in consumer mobile behavior identifed by Forrester in the past two years has been the increase in use of the Internet on mobile phones. The growth has been staggering -- consumers don't typically shift their behavior this quickly. One of the reasons has been growth in the number of smartphones we own and use. Great user experiences delivered by great user interfaces on phones and fast networks have been part of that smartphone upgrade as well. The AdMob data shows that smartphones generate 46% of its ad requests.
Download the report for a deep dive. Look for the growth in the number of countries where individuals are using their cell phones to access the Internet. We've also seen a new category emerge - "Mobile Internet Devices." See its breakdown of iPad ad requests. The US generates 58%, with Japan second at 5%.
Among the biggest strategic questions facing eBusiness & Channel Strategy executives are how to make use of the growing potential of the mobile channel, how to integrate mobile phones into their company's multi-channel strategy, and how to meet customers' rising expectations for mobile services.
We have argued that, for most companies, mobile's time has come. Every company needs to have a mobile strategy in place, even if that strategy is to wait until specific things happen before making serious investments.
Most of the eBusiness & Channel Strategy executives that we work with are either directly responsible for, or closely involved in, their company's mobile strategy. So we would like your perspective -- and we'd like to help you benchmark your mobile strategy against that of your peers.
We invite you to take part in a short survey about your company's mobile strategy, your objectives, the metrics you use and the challenges that you face. You can take part in the survey here.
The survey takes less than 15 minutes to complete.
Individual responses will be kept strictly confidential and results only published in aggregate.
In return, we will give you a free executive summary of the survey results.
We're keen to get as wide a sample of industries and geographies as we can, so please feel free to forward this survey through your networks. If you are not familiar with your company’s mobile strategy, but know who is, please forward this survey to them.
I look forward to your perspectives. Thank you in advance for your time.
Following AT&T's decision in the US ten days ago (see my colleague Charles Golvin's take here), there's a hot debate as to whether European operators will follow suite and stop their unlimited mobile Internet pricing schemes.
O2 UK announced no later than last Friday that it will stop it and introduce various caps: from 500MB for the cheapest one (GBP25 with 100 minutes and unlimited texts) up to 1GB for the most expensive (GBP60 for unlimited voice/SMS and 1GB of mobile Internet).
According to the press release, 97% of O2 smartphone customers would not need to buy additional data allowances, as the lowest bundle (500MB) provides at least 2.5 times the average O2 customer’s current use. In short, just 3% of customers will have to pay extra.
Other UK operators as well as KPN in the Netherlands and Orange France have shared indications that they will follow suite and that this pricing scheme is outdated. Here are a couple of thoughts:
The mobile industry is in full swing. Its center of gravity is shifting from hardware to software, from voice to data and services, and from traditional telecom stakeholders to new entrants.
Google’s “mobile first” approach and the shadow that Apple cast over the show are forcing mobile operators in particular to redefine their position in the value chain. The traditional focus on infrastructure (LTE..) and this year’s debate on operators’ congested networks need to be put in the context of nontelecom players’ willingness to monetize mobile. Mobile World Congress is a unique opportunity to witness how mobile is reinventing itself and to see how it will become even more disruptive in consumers' daily lives in the future.