Day in the life of a mobile commerce user

Day in the life of a Mobile Commerce User An On Device Research study for the IAB May 2012

Contents• Methodology• Day in the life of a Mobile Commerce User – What, Why and How• Uses cases: – Where and When – At home – In-Store Experience• Mobile commerce and advertising• Summary

Methodology and Sample

Methodology Stage 1: Pre Survey Stage 2: Mobile Stage 3: Post Follow Up Commerce Diary • Screening • What did? • Understanding • Why? motivations • How feel? • Attitudes towards • Where? mobile advertising • Other media? • Future scoping• Using On Device Research’s US panel, we contacted 260 respondents, who opted in to take part in a 3 stage diary project, lasting a total of 2 weeks.• All respondents recruited owned either a Smartphone or Feature phone. The focus of the report was on mobile phone based commerce, excluding tablet based mobile commerce.• Stage 1: Respondents were pre screened on demographics and mobile commerce behaviour to ensure the sample gathered was relevant and responsive.• Stage 2: The successful 260 pre screened respondents were tasked using their mobile to check in, over a period of 1 week, whenever they used their mobile phone for commerce. Mobile commerce was described to respondents as: Searching for products or services, Researching products or services, Purchasing/ordering products or services and Checking prices• Stage 3: All respondents then completed a follow up survey, which covered a range of topics from mobile commerce spend, mobile usage in store, attitudes towards mobile advertising and how they would like mobile commerce to progress in the future.• Each respondent earned $10 for taking part

The Mechanic is Simple1. Mobile owners click a web link (looks like an app icon), or bookmark once they encounter a brand.2. They then simply select which brand they have encountered, whilst also giving permission to take their GPS co-ordinates. Which What made you How feel as a Where were Using other activity? do this? result? you? media?

Day in the life of a mobilecommerce user

Mobile enhances real world commerce • 28% of mobile commerce encounters are for finding product information • 18% are for finding store locations, whilst 12% are for comparing prices. • Combined together it shows that mobile commerce is linking real world commerce to digital marketing. • 9% of mobile commerce encounters are for purchasing digital content (apps) and 5% of encounters are for purchasing other items, such as physical items and tickets. Which (mobile commerce) activity did you just use your mobile phone for? 28% 18% % Encounters 12% 9% 5% 4% 3% Find Searched for a Compared prices Purchase digital Purchased non- Checked status Used mobile product/service store location content digital item on auction site coupons infoCountry: USDate: April/May 2012Base: Total respondents (260) Significantly higher/lower. Tested at 95% confidence interval.

Convenience and mobile advertising drives mobile commerce activities • When asked why consumers carried out a particular mobile commerce activity, ‘the easiest way’ was the most popular activity. • Mobile advertising is the second highest driver. • Finding the best deal also comes through. What made you do this? (mobile commerce activity) The offer was too good to refuse 10% Recommendation from a friend/family 10% To get something immediately/didnt want to wait 11% Research for a future purchase 16% To find the best deal 20% Boredom/filling time 21% Something I planned to do 21% A mobile ad 22% Its the easiest way for me to do it 24% % of EncountersCountry: USDate: April/May 2012Base: Total respondents (260) Significantly higher/lower. Tested at 95% confidence interval.

Saving money is the overwhelming factor that drives mobile commerce • Follow up survey also showed that mobile commerce is about convenience and getting the best deal. Follow Up Survey: Important factors versus Most important factor Most Important Factor Important FactorsCountry: USDate: April/May 2012Base: Total respondents (260) Significantly higher/lower. Tested at 95% confidence interval.

Other than digital content, clothing, entertainment and consumer electronic are the top categories for mobile commerce • For early adopters, a potential glimpse into the future, there is only a slight increase in their usage of digital content usage. • For other categories, such clothing and entertainment, there is a significant increase in usage. This suggests that this is where the growth in mobile commerce (and therefore mobile advertising) will come from. Top Categories For Mobile Commerce Usage 80% 76% % Mobile Commerce Users 46% 46% 44% 38% 41% 39% 34% 33% 31% 27% 23% 27% 27% 21% Group digital Clothing Entertainment Consumer Health and Food and Furniture and Tickets (events, categories activities electronics Beauty Grocery other travel) (restaurant, housewares movies) Total Early adoptersCountry: USDate: April/May 2012Base: Total respondents (260) Significantly higher/lower. Tested at 95% confidence interval.

38% of mobile commerce users spend over $21 per month via their mobile • Although mobile commerce spending is still relatively small however 38% have purchased items over $21 per month. • 78% of those who have purchased via their mobile have done so using a credit or debit card. On an average month, how much do you spend on purchases via your mobile phone? Over $61, 10% I dont make purchases on my mobile, 30% $41 to $60, 16% $21 to $40, 12% $1 to $20, 32%Country: USDate: April/May 2012Base: Total respondents (260) Significantly higher/lower. Tested at 95% confidence interval.

Physical Goods versus Digital Goods

Protection and having a specific retail app gain importance amongst those who purchase physical goods Post Survey: And which ONE is the most important to you? Please select one answer only Order of ImportanceCountry: USDate: April/May 2012Base: Total respondents (260) Significantly higher/lower. Tested at 95% confidence interval.

Use Cases

Mobile commerce starts early morning and continues throughout the day, peaking at late afternoon/early evening • It would appear that consumers begin commerce activities on their commute. 40% 35% 30% 25% 20% 15% 10% 5% 0% 1am-3am night 4am - 6 am 7am - 9am 10am noon late 1pm - 3om 4pm - 6pm 7pm - 9pm 10pm - time early morning morning morning early afternoon afternoon early evening midnight late evening TotalCountry: USDate: April/May 2012Base: Total respondents (260) Significantly higher/lower. Tested at 95% confidence interval.

Purchasing via mobile peaks in the late afternoon/early evening • However pricing checking and comparisons peak in the early afternoon when people are more likely to be out and about. 40% 35% 30% 25% 20% 15% 10% 5% 0% 1am-3am night 4am - 6 am 7am - 9am 10am noon late 1pm - 3om 4pm - 6pm 7pm - 9pm 10pm - time early morning morning morning early afternoon afternoon early evening midnight late evening Compare prices PurchaseCountry: USDate: April/May 2012Base: Total respondents (260) Significantly higher/lower. Tested at 95% confidence interval.

47% of mobile commerce actions occurred at home Diary Stage: Where were you? At Out and At Home: About: Work: 47% 29% 10%Country: USDate: April/May 2012Base: Total respondents (260) Significantly higher/lower. Tested at 95% confidence interval.

Product information is conducted at home, location searching whilst out and about • 11% of price checking encounters where in the retail environment • 21% of mobile purchasing encounters were at work Where people use Mobile Commerce – By Activity 70% 60% 57% 49% 50% 40% 37% 35% 29% 30% 30% 26% 19% 20% 10% 0% Find information on a Searched for a store location Checked/compared prices Purchase Any Item product/service At home Group out and aboutCountry: USDate: April/May 2012Base: Total respondents (260) Significantly higher/lower. Tested at 95% confidence interval.

64% use other media at the same time as mobile commerce • 36% of mobile commerce encounters are whilst consumers are watching TV Diary Stage: And were you using/looking at any other media at the same time? TV Phone 36% (talking) 16% 64% Desk/ Radio Laptop 7% 10% 36% Newspaper Magazine 5% 4% No YesCountry: USDate: April/May 2012Base: Total respondents (260) Significantly higher/lower. Tested at 95% confidence interval.

A closer look at In Home Mobile Commerce. Where in the home? What are they doing?What media are they using?

61% of In Home commerce takes place in the front room/lounge. 20% in the bedroom Diary Stage: Where were you? In which room ? Front room/Lounge 61% 20% Bedroom At Kitchen 8% Home: 47% Garden/patio etc 8% Bathroom 1% Other rooms 2%Country: USDate: April/May 2012Base: Total respondents (260) Significantly higher/lower. Tested at 95% confidence interval.

49% of In Home commerce interactions occur with the presence of TV Diary Stage: Where were you? What media? TV 49% Phone (talking) 13% Desktop/laptop 6% At Home: Radio 4% 47% Press 4% Tablet 3% Other 4% No, none of these 31%Country: USDate: April/May 2012Base: Total respondents (260) Significantly higher/lower. Tested at 95% confidence interval.

A 25-34, female from NJ: How does she use her mobile in home for commerce? 1st In Home Commerce Activity: 18/04/12 2nd In Home Commerce Activity: 18/04/12 What?: Find store location What?: Purchased digital content What made her do this?: Couldn’t find store What made her do this?:Planned to do How feel?: Helped make best decision How feel?: Entertained/amused Where?: Living room Where?: Patio Other media?: TV Other media?: No other media 3rd In Home Commerce Activity: 18/04/12 What?: Scanned barcode on 6th In Home Commerce Activity: product/ad to get more info 20/04/12 What made her do this?: Planned to do What?: Scanned UCP to receive points How feel?: Entertained/amused from app Where?: Living roomWhat made her do this? Offer too good Other media?: TV to refuse How feel?: Entertained/amused Where?: Kitchen 4th In Home Commerce Activity: 19/04/12 5th In Home Commerce Activity: 19/04/12 What?: Scanned barcode to recover What?: Purchased an item points for app What made her do this? Boredom What made her do this?: Offer too good How feel?: Got best price to refuse Where?: Living room Feel?: Entertained/amused Other media?: TV Where?: Kitchen Country: US Date: April/May 2012 Base: Total respondents (260) Significantly higher/lower. Tested at 95% confidence interval.

A 25-34, male from Florida: How does he use his mobile in home for commerce? 1st In Home Commerce Activity: 19/04/12 2nd In Home Commerce Activity: 19/04/12 What?: Find info on product/service What?: Check prices via browser What made him do this?: Planned to do What made him do this?:Easiest way to do it How feel?: Chose right brand/retailer How feel?: Entertained/amused Where?: Living room Where?: Kitchen Other media?: TV, phone (talking) Other media?: TV, phone (talking) 3rd In Home Commerce Activity: 20/04/12 What?: Used mobile coupons/vouchers 5th In Home Commerce Activity: What made him do this?: 22/04/12 Recommendation friend/family What?: Searched for store How feel?: Help make best decision for location me What made him do this?: Easiest Where?: Living room way to do it Other media?: Radio Feel?: Easily find useful info Where?: Living room Other media?: TV 4th In Home Commerce Activity: 22/04/12 What?: Check prices via browser What made him do this?: Easiest way to do it Feel?: Easily find useful info Where?: Living roomCountry: USDate: April/May 2012Base: Total respondents (260) Significantly higher/lower. Tested at 95% confidence interval.

In-Store Mobile Experience

76% of mobile commerce users have used their mobile in-store • 34% use mobile for checking prices whilst in-store • 32% take photos to send to others – skewing towards females • 13% have scanned a barcode Have you used your mobile phone when shopping in a store in the past 3 months? if so, what for? 60% 49% 50% 40% 34% 34% 30% 24% 20% 20% 15% 15% 14% 14% 13% 9% 10% 0% Call/text Check prices Taking Check for Check Fill time Check for Show Scan barcode To check I have not family picture/s of another store product when waitinglocation deals shop/store on opening used my member for product to in the area reviews to check out assistant the product/ad times mobile phone advice send to a item you are for while friend/family after information shopping in member storeCountry: USDate: April/May 2012Base: Total respondents (260) Significantly higher/lower. Tested at 95% confidence interval.

53% have stopped a purchase in store as a result of using their mobile • Finding a better price is the key reason behind this. Follow Up: Have you ever abandoned or stopped a purchase in store as a result of using your mobile phone in store? If so why? Found a better price in another store 38% Found a better price online 30% 53% Found a better item online 21% Product was out of stock/not available 13% 47% Saw a negative review about the product 11% Bought a similar item instead 11% Couldnt find info on product was planning to No Yes 11% purchaseCountry: USDate: April/May 2012Base: Total respondents (260) Significantly higher/lower. Tested at 95% confidence interval.

Mobile Commerce CaseStudies

A day in the life of Mobile Commerce – 25 to 34, female, Near AtlantaCountry: USDate: April/May 2012Base: Total respondents (260) Significantly higher/lower. Tested at 95% confidence interval.

A day in the life of Mobile Commerce – 25 to 34, female, Near Atlanta 3rd Commerce Activity: 18/04/12 2nd Commerce Activity: 16/04/12 What?: Checked prices via app What?: Bid/checked auction site What made her do this?: Mobile ad, What made her do this?:Offer too research for future, best deal, easiest way good, find best deal, easiest way How feel?: Got best price, chose right How feel?: Got best price, improved brand/retailer retail experience, helped make best Where?: In store/shop/mall decision Other media?: Poster/billboard Where?: Out and about Other media?: Radio (driving)6th Commerce Activity: 20/04/12What?: Purchased an itemWhat made her do this? Easiest wayHow feel?: Got best price, chose rightbrand/retailer 1st Commerce Activity: 16/04/12Where?: Out and about What?: Find info on product/serviceOther media?: TV, Poster/billboard, What made her do this?: Find the bestTablet deal How feel?: Saved time, helped make best decision, easily find useful information Where?: Travelling (short trip) Other media?: In store promotion 4th Commerce Activity: 19/04/12 5th Commerce Activity: 19/04/12 What?: Purchase item What?: Purchased digital item What made her do this?: Recommendation, best deal What made her do this? Planned to do Feel?: Best price, improved retail experience How feel?: Got best price Where?: At work Where?: Out and about Other media?: Desktop/laptopCountry: USDate: April/May 2012Base: Total respondents (260) Significantly higher/lower. Tested at 95% confidence interval.

Mobile Commerce andAdvertising

As we saw on slide 9… At 22%, Mobile Advertising is the second highest driver of mobile commerce. What are consumers perceptions of mobile advertising? What opportunities exist?

Mobile Advertising is welcomed by consumers • 70% view mobile ads as a personal invitation • This reflects a clear opportunity for brands and advertisers alike to engage consumers. Which of the following is closer to your view of ads on your mobile/smartphone? 30% 70% A personal invitation A personal invasionCountry: USDate: April/May 2012Base: Total respondents (260) Significantly higher/lower. Tested at 95% confidence interval.

Mobile advertising should give consumers more than just a ‘check out’ • 40% want mobile ads they click on to allow them to browse the brand/companys broader product offering. • 28% want to learn more about the brand/product being advertised. • 51% of those who see mobile ads as an invitation, want to browse further. Click to buy: I want to be taken straight through to the check-out page 4% 7% 24% 28% Click to learn: I want to see more details on the exact product in the advertisement 40% 51% Click to browse: I want to see a page showing a whole range of similar products from the same company 25% 20% Click to explore: I want to start at the homepage of the company Total A personal invitationCountry: USDate: April/May 2012Base: Total respondents (260) Significantly higher/lower. Tested at 95% confidence interval.

Relevance and permission are key if advertisers are to personalise advertising for consumers • 30% state they like the fact that ads are personalised to them. • 27% feel personalised ads are ok, as long as they have given their permission to receive them. How do you feel about ads that are personalized to you (ie. based on anonymous information about where you are, your age/gender or other characteristics, etc)? 40% 37% 30% 30% 27% 24% 24% 22% 21% 20% 14% 10% 0% I like that they’re relevant to me They are ok, but only if I have given I don’t like them – too much of my It makes no different that they’re my permission to receive them personal information is being personalised – they’re just like any shared other ad Total A personal invitationCountry: USDate: April/May 2012Base: Total respondents (260) Significantly higher/lower. Tested at 95% confidence interval.

Location, favourite brands and previous site history are the starting blocks for relevant mobile advertising Assuming advertising has to happen, which of the following ways to make ads more relevant to you would you be open to? Your location (city or neighbourhood) 28% 27% Your favorite brands 26% 27% Sites youve visited online 24% 27% Information you give the “ad” at the beginning 21% 20% Your age/gender, whether you have kids, or other… 21% 23% Information you have shared publicly via Facebook, Twitter… 18% 19% Your recent TV/radio viewing 16% 19% Your recent online purchases 15% 17% Your daily routine 11% 13% None of these 14% 10% Total A personal invitationCountry: USDate: April/May 2012Base: Total respondents (260) Significantly higher/lower. Tested at 95% confidence interval.

31% state that they would like proactive alerts of products they want/need • 30% would like to pay for something via phone and then pick it up in store. • 29% want a better browsing experience. Thinking about the future of mobile commerce (searching/buying/booking products and services via your mobile phone) how would you like this to 40% progress? 31% 30% 29% 28% 30% 26% 22% 20% 10% 0% Proactive alerts to let me Ability to pay for Better browsing Mobile loyalty Better/more price and Mobile wallets -making it know when products I something by phone and experience e.g Wifi or 4G cards/scheme -rewards information comparisons easier to pay using my want or need are pick it up in store for paying by phone phone available or on saleCountry: USDate: April/May 2012Base: Total respondents (260) Significantly higher/lower. Tested at 95% confidence interval.

Mobile Commerce is not just about digital downloads but is really linking digital marketing with real world commerce In tough economic times consumers are searching for the best deal. The mobileInternet is allowing consumers to search andfind this in the best price in the best location, be that on mobile or in the physical retail store. This leaves retailers with no where to hide, giving consumers true price transparency.Mobile advertising is a huge influencer in this new phenomenon

 Some specifics on Mobile Commerce 1) In Home Usage: 61% of In Home Mobile Commerce occurs in the front room/lounge TV offers a clear opportunity as an additional screen – 49% of those who conducted mobile commerce did so with TV as an additional media 2) Mobile Commerce and Advertising Mobile advertising is a key driver of mobile commerce and is welcomed by the majority of consumers, BUT: a) It must give consumers more than just a ‘check out’ b) It must be relevant and consent must be sought c) Location, favorite brands and previous site history are routes to make mobile advertising more relevant to consumers d) Future looking, consumers want a mix of features and function - proactive alerts, the ability to buy via phone and pick up in store and a better browsing experience.

About the IABThis study was commissioned by the Interactive Advertising Bureau (IAB) in the USThe Interactive Advertising Bureau (IAB) is comprised of more than 500 leadingmedia and technology companies that are responsible for selling 86% of onlineadvertising in the United States. On behalf of its members, the IAB is dedicatedto the growth of the interactive advertising marketplace, of interactive’s shareof total marketing spend, and of its members’ share of total marketing spend.The IAB educates marketers, agencies, media companies and the widerbusiness community about the value of interactive advertising. Working with itsmember companies, the IAB evaluates and recommends standards andpractices and fields critical research on interactive advertising. Founded in1996, the IAB is headquartered in New York City with a Public Policy office inWashington, D.C. For more information, please visit www.iab.net

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Day in the life of a mobile commerce user

by On Device Research on Aug 06, 2012

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Day in the life of a mobile commerce user Presentation Transcript