Japan Digital Overview from Neo @ Ogilvy 2010

Japan digital landscape and insights
December2,2010
Neo@Ogilvy Japan

Agenda
JapanMarket
Social Media
Mobile
New Device& Technology

Japan Market

Transition of Internet Users
94.08 million users, 78.0% penetration rate
(million people )
Datasource:Ministry of Internal Affairs and Communication 2010
4

Usage rate by Age/Gender
Male 81.3%, Female 74.9% over age 6
(%)
5

Internet Usage Device
Slight increase in Mobile & Game/TV connection (year-on-year)
(Unit=million people )
PC
85.14 M(90.5%)
PConly
12.92 M(13.7%)
-0.3%
(vs 2009)
Mobile
80.10 M(85.1%)
+2.5%
(vs 2009)
PC& Mobile
64.92 M(69.0%)
0.76 M
(0.8%)
4.75 M
(5.2%)
0.02 M
(0.0%)
Mobileonly
8.85 M(9.4%)
Game or TV
5.67 M(6.2%)
0.13 M
(0.1%)
+1.7%
(vs 2009)
6

Corporate Internet Usage
Almost all companies use Internet
Internet Use Trend (Business)
(%)
By Businesses of Different Employee Size
(%)
7

By type of Internet line
Gradual increase in Broadband, decrease in Narrowband
Households
Businesses
Broadband
76.8%
Broadband
76.9%
8

Penetration of Communication Device
Mobile/PHS/PC are highly popularized
(%)
Mobile Phone & PHS
PC
Car Navigation System
Gaming Hardware
(Internet-enabled)
TV
(Internet-enabled)
9

Transition of Ad Spend by Media
Internet has grown 1.9 times bigger than 2005, and has become 2nd largest media following TV
(M USD / 1 USD = 100 JPY)
INT : 861.8%up
INT : 87.2%up
1.2%　up
MG : 27.4%down
MG : 37.3%down
25.6%down
NP : 44.0%down
NP : 35.1%down
18.6%down
TV : 17.1%down
TV : 16.0%down
10.2%down
Datasource:dentsu 2010
10

Transition of Internet Ad Spending
Listingand Mobileare the pulling force
Datasource:dentsu 2010 (2006-2009) / Mizuho Corporate Bank (2010-2012)
11

Usage Site Ranking
Prominent change in user usage trend from portal/ISP to social media
2001.3
2002.3
2003.3
2004.3
2005.3
2006.3
2007.3
2008.3
2009.3
2010.3
(Ranking)
Yahoo!
74.3
Yahoo!
74.6
Yahoo!
78.9
Yahoo!
81.9
Yahoo!
83.8
Yahoo!
86.4
Yahoo!
87.3
Yahoo!
88.0
Yahoo!
82.2
Yahoo!
83.7
1
Nifty
48.2
Nifty
47.9
Rakuten54.8
Rakuten
57.4
Rakuten
60.7
Rakuten
60.2
Rakuten
56.1
Google
59.2
Google
63.9
Google
66.0
2
MSN
42.4
MSN
44.8
Nifty
50.9
MSN
55.1
MSN
51.4
GMO Internet
52.9
Microsoft
54.7
Rakuten55.0
Rakuten50.7
Rakuten
53.1
3
NEC
39.7
Rakuten
43.4
MSN
49.6
Nifty
50.1
GMO
49.1
Nifty
48.7
NTTCom.
52.9
NTTCom.
52.5
NTTCom.
47.8
NTTCom.
50.1
4
Sony
31.6
NEC
40.3
NEC
43.7
Microsoft
43.8
Nifty
47.5
MSN
47.4
Google
50.0
Microsoft48.1
FC2
44.2
FC2
46.5
5
Microsoft
31.4
Microsoft
37.7
Microsoft
41.7
NEC
43.6
NEC
42.7
NEC
43.0
GMOInternet
48.0
GMOInternet
46.8
Microsoft
42.9
GMOInternet
43.6
6
DTI
27.9
Sony
36.2
Sony
35.2
Sony
35.9
Microsoft
39.2
Amazon
40.2
Nifty
46.1
FC2
44.2
GMOInternet
41.9
Wikimedia
40.5
7
Rakuten
26.9
NTTCom. 31.6
NTTCom.
33.9
NTTCom.
35.8
NTTCom.
37.7
FC2
38.6
NEC
43.5
Nifty
43.2
Nifty
37.9
Nifty
40.4
8
Wikimedia
34.9
Lycos
26.8
9
Lycos
26.6
KDDI
28.9
GMO
32.4
Sony
34.7
NTT Com.
38.5
FC2
41.7
Livedoor
38.4
Microsoft
39.7
DDI
26.2
10
NTT-X
26.0
AsahiNet
25.5
KDDI
28.7
NTT-R
34.2
Livedoor
37.9
Livedoor
40.0
Wikimedia
37.8
Livedoor
34.6
CyberAgent
39.0
Twitter
0.7
Twitter
12.2
Appendix
Datasource:Nielsen Online (Home Panel)
12

SocialMedia

SpecialSneakers
14

Types of Social Media
15

Microblog
16

Microblog
17

Types of Micro-blog
Twitter usage is dominant, mainly accessed from mobile
Data Source:Internet White Paper 2010
18

Twitter visitor number trend
As of Sept. 2010, Twitter has acquired over 11 million visitors, exceeding mixi
（in1000）
Data Source:NeilsenNetview※Excluding access from client exclusive to Twitter
19

How is Twitter used?
Share
Learn
Tell
20

What are they tweeting?
Mostly private things…
Data Source:Internet White Paper 2010
21

Twitter as Business Tool
Many business leaders and media delivering information on daily basis
BusinessLeader
Media
1,373
29,582
680,768
47,146
7,469
1,827,353
4,462
10,862
3,301
90,047
51,398
7,437
221,312
2,472
3,890
4,144
+Competitor
Data Source:Twitter(November 29, 2010)

What companies are tackling?
PR
Promotion
Communication
CRM

CaseStudy
au – IS Series
Twitter icon projected on the wall of Roppongi Hills like fireworks
24

Stride – Find the Monkey Campaign
CaseStudy
25

GAP–WANTCAMPAIGN
CaseStudy
26

SNS
27

SNS in Japan
Affiliation
19.93 million
20.74million
Conflict
Conflict
20.59 million
people
Membership as of June 2010
28

Strategy of 3 SNS companies
Addressing the mechanism that strengthens real relationship between people on the web
Strengthening virtual relationship with Social Game as the principal axis
29

Hot SNS
Real name& Open culture
Anonymity
Career- move style
Closed office environment

Twitter and Facebook
Using both is standard in US
Datasource:Twitter and Facebook (November 29, 2010)

Usage situation of companies in Japan
Facebookis not penetrated in Japan
Datasource:Twitter and Facebook (November 29, 2010)

Levi’s – Levi’s Girl
CaseStudy
33

General Mills – Coping With Disbelief Clinic
CaseStudy
34

Dell – Social Media for Small Business
CaseStudy
35

Mobile

Shipment volume is slightly on the increase since 2009. However, overall, it seems to have hit the peak.
Mobile terminal shipment volume
( x 1,000 )
Datasource:Yano Research Institute 2010
37

Smartphone holds 5.9% share of total mobile phone, and is expected to reach 30% by 2013
Smartphone shipment volume
( x 1,000 )
Datasource:Yano Research Institute2010
38

iPhone reign supreme in 2009 taking up over 70% of the market
Shipment by Maker
Datasource:MMResearch Institute2010
39

GALAXY S start exceeds iPhone 4. Reservations alone over 50,000 -Oct27,2010
Ｎ
Expansion of Smartphone Devices
Clash with Android as 15 new models from 3 companies in winter/spring
KDDIISO3to be launched
250,000 tentative reservations made already – Nov26
１.69 million iPhone shipped in 2009, 72.2% of smartphone-Apr23,2010
460,000 Xperiashipped by end of Sept.9-Oct27,2010
40

Both Corporations/Individuals are considering active usage of smartphone
Smartphone used for business
Provided by Company
etc
Business Usage Seminar
Book
41

Advanced business usage of mobile in various areas
CaseStudy
Advanced companies/corporations
Toden Home Service,Keio Electric Railway, Kawatsu-cho PTA
Mobile
Internet
GPS
Cloud
Application
ASP
Camera
Sound
&
Video
Mobile
Internet
GPS
Cloud
Application
ASP
Camera
実現例
店舗の売上商品、金額のスピーディな把握
現場、本社がタイムリーに連携した顧客情報、サービス
ペットの遠隔健康管理
高齢者や子供と家族を繋ぐ情報システム
Specifically,
Quickly grasping sales of merchandise and price at each store
Delivery of timely customer information and service from headquarters to stores
Simple information system connecting seniors and kids with family

Responding Companies
iPhone4 - Nov 25, 2010
43

Application
44

App Store is downloaded 3 times more than AndroidMarket worldwide, with 1.5 times more registrations
App Store vs Android Market
Registration #
150,000
(Feb2010)
Downloads
3 billion
（Jul2010)
Registration#
100,000
(Jan2010)
Downloads
1.2 billion
(Aug2010)
Datasource: Apple Inc/GoogleInc
45

Daily-use Applications – essential to business
Business-related applications
46

Sankei Shimbun-iPhone APP AD
Case Study

SUNTORY-Highball Master
Case Study
48

Mercedes–SLSAMGShowcase Application
Case Study
49

Chopper2-iPhone + iPad
Case Study
50

iAd
51

52
iAd is an…
Advertising platform within applications
Enables delivery of interactive advertising or high-quality images when clicking ad
in full screenwithin the application
without moving to another site
Supports targeting byLocation Information
Ad is created with HTML5avoiding Flash

By end of 2010
$ 60 million
Worth placement is expected
Advertisers
Walt Disney, NISSAN, Citigroup, Unilever, AT&T, Chanel, General Electric, Liberty Mutual Insurance, State Farm Mutual Automobile Insurance, GEICO, Campbell Soup, Sears Holdings, J. C. Penney, Target, Best Buy, DirecTV, Turner Broadcasting Systemetc…
iAd
in the US Market
53
Market size

Case Study-US

iOS vs Android
55

Installed OSShare
Datasource:Seed Planning “ Smartphone / iPad (Tablet PC) Report
56

iOSdevices and Androiddevices
Home Electronics
Car etc….
TV
Smart Phone
Tablet PC
Projection
57

New Technologies &Devices

Digital Books
59

DeviceMap 2010
iPad has established a new position
Personal
LightTask
HeavyTask
Public
60

Movement of digital books
2010
”agora-books” (publisher specializing in digital books) established
Mar
The Electronic Book Publishers Association of Japan established
Apr
“Astand” (Digital book delivery site for Asahi Shimbun PC) opened
May
“iPad“ launched
“Digital Library Publication”(digital publication purchase application for iPhone offered free of charge)
Jun
Kinokunia Books announced entry into digital book delivery market
Jul
“Kindle”announced 2 new product models
Seven&I holdings announced entry into digital book business
Aug
NTTdocomo, Dainippon printing formed business partnership in digital book platform construction
“SONY Reader“ new series released
“Galaxy Tab”(Samsung)announced
Sept
“GALAPAGOS(Sharp)announced (to be launched in December)

Previously driven by comics for mobile phone
With the appearance of iPad and exclusive terminal, demands on new platform is expected to grow
Digital Book Market Size
PROJECTION
Datasource:Impress R&D “Digital Book BusinessReport2010”
62

Digital Book Terminals (new platform)
Tablet PC
iPad
Galaxy Tab
LifeTouch
GALAPAGOS
FLEPia
Digital book exclusive terminal
SONY Reader
Kindle
63

Social Reading
Reading together
Where did other readers highlight?
What were other readers’ comments?
Review
Twitter favorite phrase on Twitter
Online Book
Club
4 other people highlighted this part of the book
64

Layer Reading
Idea of digital book creating new reading experience and business opportunities
Layer for sharing thoughts and impression with members
Layer for comments by other writer
Layer for discussion with friends about book purchase
65

iPad used in advanced ways by various industry
CaseStudy
PRESENTATION
TOOL

Mini Cooper – Application + AR
Case Study
68

69
Case Study

InsightforConstituencies

Contact Media Depending on Information Type
Various contact media have separate purpose
Business:NP, MG, Online / IT : MG, Online
Datasource:JapanMediaConsumption Study5
71

Contact Media Depending on Purchase Process Activity
Transition of top 10 media
IT site, IT magazines, Portal site/News site are influential when accessing information
Accessing info.
Considering
Decision-making
ITpro,@ITinformation site
Portal/News site
IT magazines
Vendor homepage
Exhibition/Seminar
Seminar hosted by Vender
Person in charge of Vender
Person in charge of Agent
Business Magazine
NP (national)
Datasource:ES quantitative research2010
72

Usage frequency of each website
Usage pattern differ depending on site
Tendency to access portal site every day
（現、日経電子版）
Datasource:JapanMediaConsumption Study5)
73

Current Situation of Smartphone
89％ aware of smartphones
among which12％are already using them
51％are
considering using them
※Total of all target (CxO, LOB, IT in LEE/MM)
※Research conducted in 2010.3
74

Usage rate of Social Media
10%
7%
30%
2%
※Total of all target (CxO, LOB, IT in LEE/MM)
※Research conducted in 2010.3
1%
75

Thank you
76

Japan Digital Overview from Neo @ Ogilvy 2010

by Barney Loehnis on Dec 02, 2010

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