As it did for the iPhone 5S and 5C, Apple has tweaked its product portfolio with two new products to maintain premium positioning in an increasingly competitive tablet market. Both the iPad mini 2 (starting at $399) with Retina display and the iPad Air (starting at $499), which is thinner (43% thinner than the iPad 4), lighter, and faster (with a super-fast A7 chip) are great additions to the iPad product portfolio and come with new colors and covers. As always with Apple, expectations on systematic breakthrough hardware innovations are irrational. Apple is good at inventing new products (e.g., iPod, iPhone, or iPad) and at maximizing profitability of its product range over time through software innovations and clever marketing. Yes, at some point, the company will need to disrupt a new market once again, but today’s announcement is really about making sure it maintains the premium brand experience for the holiday season when competition is heating up — not just for tablets but also for the amazing new line of Mac products.
Let’s step back to January 2007. Do you remember what your job was at that time? I was already an industry analyst covering mobility, and at that time, the space was less fascinating to cover. Back in January 2007, Google had acquired YouTube for $1.65 billion only a couple of months before. Android did not exist. The iPhone did not exist. Twitter did not exist. Facebook was only a couple of months old as an open public website. Nokia had a market valuation of around $120 billion, and its share of the global smartphone market was above 45%. BlackBerry – then the leader in enterprise mobility solutions – had initiated a move in the consumer space with the BlackBerry Pearl.
Less than seven years later, Google has activated more than 1 billion Android devices, and Apple will soon pass the 700 million iOS devices mark. YouTube now has more than one billion users globally and generates 40% of its traffic from mobile devices. Facebook has 1.2 billion users and generates 41% of its ad revenues from smartphones and tablets (it could even reach 50% in Q3 2013; Facebook discloses its financial results on October 30). Twitter has more than 230 million users and generates more than 70% of its revenue via mobile.
Push notifications make the most of mobile marketing’s unique attributes: intimacy, immediacy, and context. When consumers opt in to receive push notifications, it means they trust you to the point of giving you permission to contact them on their most personal devices. If your messages are not relevant, you will lose your best customers.
Our research shows that consumers who receive push notifications are also the heaviest app users. However, to avoid being spammed with irrelevant messages, consumers increasingly want to be in control, setting preferences on the types of messages they want to receive and when they want to receive them.
While push notifications enable better engagement, the challenge for marketers will be to think beyond just push notifications for smartphone apps. Push notifications already extend messaging to other connected devices. How will push notifications complement email, SMS, and in-app messaging? How will performance from various direct marketing channels evolve?
To differentiate, marketers will have to integrate push into cross-channel and CRM platforms and integrate mobile as a variable of their customer base. Marketing vendors will have to add new messaging platforms, like push notifications, into their core offerings, pushing for another wave of consolidation highlighted by the recent acquisition of Xtify by IBM.
The app economy is blurring the lines and opening up new opportunities, with a lot of new entrants in the mobile space, be it with mobile CRM and analytics, store analytics, dedicated gaming analytics, etc. A bunch of players have raised more than $250+ million among the likes of Flurry, Urban Airship, Crittercism, Kontagent, Trademob, Apsalar, App Annie, and Localytics, to name a few. Expect a lot of innovation and acquisitions in that space once mobile is more naturally integrated into digital marketing strategies.
On average, mobile now represents more than 20% of overall traffic to websites. For some companies, including many in media, more than half of all visits come via mobile devices. In some countries, such as India, mobile has surpassed PC traffic. Marketers are integrating mobile as part of their marketing mix, but too many have not defined the metrics they’ll use to measure the success of their mobile initiatives. Many lack the tools they need to deeply analyze traffic and behaviors to optimize their performance.
Thirty-seven percent of marketers we surveyed do not have defined mobile objectives. For those who do, goals are not necessarily clearly defined, prioritized, and quantified. Half of marketers surveyed have neither defined key performance indicators nor implemented a mobile analytics solution! Most marketers consider mobile as a loyalty channel: a way to improve customer engagement and increase satisfaction. Marketers must define precisely what they expect their customers to do on their mobile websites or mobile apps, and what actions they would like customers to take, before tracking progress.
Eventually, Microsoft announced its decision to acquire Nokia's devices and services unit for € 5,4 billion.
After all these years of speculation, now was the time to invest. Indeed, despite the collapse of the Nokia handset empire, Nokia still has numerous assets: a wide portfolio of patents, Nokia’s product engineering and global capabilities in manufacturing, marketing, and distributing mobile phones. Microsoft is thus not only acquiring the Lumia brand but also the Asha one – bearing in mind Nokia still sold close to 54 million devices in Q2 2013.
Nokia will now focus on its three core technologies: the network infrastructure with NSN, its maps and location-based service ecosystem with HERE, and Advanced Technologies. There were early signs of the new approach when, a year ago, Nokia started to build brand equity beyond mobile phones with HERE (see my take on this blog at that time) but also more recently when Nokia announced its decision to acquire Siemens’ take to fully own NSN. Microsoft will pay Nokia a four-year license of the HERE services, bringing some regular revenues to the now much smaller company.
To avoid parts of the company to be acquired by some Far East Asian manufacturers and due to the diminishing investments from other Windows Phone licensees, Microsoft had to adopt a vertically integrated strategy. They are indeed the best placed to generate synergies with Nokia following the more than two years agreement. And as All Things Digital puts it, Stephen Elop is now the Microsoft CEO candidate to beat.
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.
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:
More often than not, people refer to 2007 and the launch of the iPhone as the key milestone that changed forever the mobile industry. Despite an incredible device, Apple struggled the first few months because its business model relied on sharing revenues with telecom operators instead of letting them subsidize its smartphones. The key milestone was in fact July 2008 and the launch of the Apple App Store because it symbolized a new era: the shift from hardware to software in the mobile industry.
While Apple was not the first app marketplace, it is fair to say it created the App economy. 5 years and 50 billion downloads later, where do we stand?
App Stores: A Unique Opportunity To Engage Consumers Directly
Ask console gaming companies what they think of disruption created by app stores (now a generic term following the end of the “app store” name lawsuit between Apple and Amazon) and you’ll get a sense of what the app economy is. We’re scratching the surface of changes to come but clearly the app economy enables brands (including those who do not have a retail presence) to get insights on consumer behaviors to create new products and to distribute them at much lower cost. Numerous consumer app stores have flourished (more than 70 different Android-based app stores in China!) but few are really succeeding. Google Play has surpassed the Apple App Store when it comes to the sheer number of available apps and both have surpassed 50 billion downloads leaving competitors in the dust. However, volume does not matter so much any more. This is all about usage, personalization and recommendation.
Too many marketing leaders still lump tablets and smartphones into the same mobile bucket. That’s a mistake. Why? Because tablets are not primarily mobile devices. Instead, they are mostly used within the home. Marketing leaders must create a differentiated tablet experience or risk dissatisfying their best customers and missing opportunities to engage when customers discover and explore their products.
Here are the key takeaways from new research I conducted in the past few months:
Tablet marketing matters. Tablet marketing enables marketers to engage with influential customers who spend less time on PCs and print media. People use tablets differently from smartphones, requiring marketers to adapt their approach.
Marketers should use tablets to enhance discovery and depth in the digital home. Marketers will see the benefits of designing immersive tablet experiences for people discovering and researching their brands and products. They should use search marketing to drive better conversion rates and tablet commerce. And they should maximize TV ads by creating tablet extensions for multitaskers as well as creating new marketing experiences in the digital home.
Shift to contextual marketing. Most of us have only had mobile phones for, at most, 12 years. I have already explained here why we’re all mobile teens, figuring out our relationships with others and with brands. Unsurprisingly, marketers face challenges integrating mobile and tablet in the mix. It’s time to stop thinking about devices and instead shift to thinking about contextual marketing.
My colleague Reineke Reitsma recently published a blog on the limited but growing uptake of QR/2D barcodes.
Let’s face reality. Usage is low and marketing execution is poor to date, with too many campaigns that lack a clear consumer benefit and that provide a bad user experience by not offering mobile-optimized content. Today, mobile bar codes are an interesting tactic to engage with early adopters.
However, moving forward, we expect QR codes to gain traction and to be increasingly mixed with other technologies (including radio technologies like NFC) to provide extended product packaging solutions. Bar codes do not have to be just cold, emotionless, black-and-white squares. Solutions now exist to personalize QR codes’ designs and seamlessly mix them into a logo or band chart – even merging QR codes and NFC tags, as in the example below from mobiLead solutions.
The 2D bar code market will follow the same path as the 1D bar code market: fulfilling the need for certified and scalable platforms dealing with millions of standard code generation. Mobile bar code vendors will have to move into scalable mobile engagement platforms, progressively integrating multiple access technologies, such as Near Field Communications (NFC) tags, image recognition, or audio tags such as Shazam, and offering deep analytical tools. Beyond the emerging role of 2D bar codes in sales, we expect a growing number of brands — especially in the nutrition and health space — to systematize the use of bar codes on product packaging. Consumers want access to more product information, and brands can leverage mobile technologies to create a consumer relationship.