With over 450 mobile devices in North America and an average of 10 new phone launches each week, how do shoppers decide which phone is right for them? How do marketers influence these purchase decisions? We're excited to announce that Google and Compete recently completed their latest research study, Wireless Shopper 2.0, which covers the shifting cell phone marketplace, the rise of the smartphone and the role search plays in the purchase process.

1. Wireless Shopper 2.0
April 20, 2010
Google Confidential and Proprietary

2. 450+
phones in
North America
with
10
launches a week
Google Confidential and Proprietary 2
1 Source: Gartner Group (2009)

3. Methodology
• The initial study was based on understanding the attitudes of online users who identified
themselves as wireless purchasers and analyzing behavioral clickstream activity of those observed
adding a wireless product to their shopping cart. A follow up study was completed, performing an
attitudinal and behavioral study based on a major phone launch in Q2 2009
• Tracked online search and research activity using Compete’s 2MM US opt-in panelists from Nov
2008 to Dec 2009, including carrier, OEM, 3rd party reseller and research sites
• Includes both paid and natural Search
• Sites and Search terms used were provided by Google
We tracked consumers online We analyzed those who added Surveyed searchers to
shopping activity to understand the product to cart, tracing their understand their purchase
shopping and searching behavior backward from the point behavior.
patterns. of purchase.
Google Confidential and Proprietary 3
Source: Google/Compete The Value of Search for Wireless Product Launches Study, March 2010.

4. shifting smart search
marketplace phones
Google Confidential and Proprietary 4

5. shifting
marketplace
Google Confidential and Proprietary 5

6. Device Focused Consumers
Online Regardless of Purchase Location
General Retailers Stepping it Up
Google Confidential and Proprietary 6

7. Shoppers Open to Switching
Service Provider Device
42%
did not know exactly which
78%did not know exactly which OEM
Carrier they would purchase from they would purchase from
Q - When you first considered your most recent cell phone purchase, which statement best describes your mindset about the
wireless service provider? (Total Respondents=2961) Google Confidential and Proprietary 7
Q - Which statement best describes your mindset about the brand of cell phone? (Total Respondents=2961)
Source: Google/Compete Wireless Shopper Study, January 2010.

8. Hot Phones and Features Trump Upgrades
“I was eligible for a “I wanted a phone “I saw a new
free or discounted with more cell phone that I
upgrade with my features” had to have”
provider”
-11% +20% +17%
Q. Why did you decide to make this cell phone purchase? (n=2881, among those not purchasing first cell phone)
Source: Google/Compete Wireless Shopper Study, January 2010.
Q. Why did you decide to make this cell phone purchase? Please select all that apply. (n=1217, not first phone)
Source: Wireless Shoppers Study, Google & Compete May 2008 Google Confidential and Proprietary

9. Device Interest Reflected through Search
Queries
Source: Google.com, US Google Confidential and Proprietary 9

10. Consumers Increasingly Research Online
29%
increase in the number of online
resources used in research+
63%
of people who bought
phones in stores researched
their purchase online
Q - Which of the following sources did you use to research your recent cell phone purchase? (Total Respondents=2961)
+ As recalled by survey respondents in 2009 vs as recalled by 2008 survey respondents Google Confidential and Proprietary 10
Source: Google/Compete Wireless Shopper Study, January 2010.

11. Same Online Research to Buy Online or In-store
Type of Information Researched Online
*
*
Q - Which of the following activities did you conduct online during your most recent cell phone purchase research process? 11
Please select all that apply. (n=2057; based = shoppers that used online sources) Google Confidential and Proprietary 11
Source: Google/Compete Wireless Shopper Study, January 2010.

12. Buyers Spending More Time Researching
Time Spent Researching Phone Purchase
5%
4 weeks or more
9% **
Total 2008 (n=1257)
1 week but less than 4 20% Total 2009 (N=2961)
weeks 25% **
More than two days, but 19%
less than one week 20%
56%
2 days or less
45% **
0% 10% 20% 30% 40% 50% 60%
Q - How much time did you spend researching your most recent cell phone purchase? (Total Respondents=2916).
Source: Google/Compete Wireless Shopper Study, January 2010. Google Confidential and Proprietary 12
Source: Wireless Shoppers Study, Google & Compete
Q: How much time did you spend researching your recent cell phone purchase? (N=1257, asked of recent wireless buyers, May 2008)

13. Retailer Sites Increasing Share of Voice
Website Traffic Growth Dec 2008 vs Dec 2009
178% Amazon 107% Target
Aggregate of
160% RadioShack 44% OEM sites
Aggregate of
26% Walmart 3% Carrier sites
Source: Compete.com Google Confidential and Proprietary 13

14. Increasingly Influential as a Resource
Used During Research Process Influential to Purchase Decision
(2008 vs 2009) (2008 vs 2009)
45% 65%
60%
40% 40% 60% 57%
40% 55%
55% 51%**
35% 50%
45%**
45% 40.00% 40.09% 45%
30%
40%
25%
40%
24%** 35%
35% 35%
20% 30% 18%** 30%
16% 24.00%
25%
25%
15% 18.10%
20% 20%
16.00%
10%
9% 15%
15%
10% 9.00%
5% 10%
5%
5%
0% 0%
0%
Wireless Carrier WirelessSite Site
OEM Carrier Retailer Site OEM Site Wireless Carrier Site
Retailer OEM Site Retailer Site
Site Site
2008 2009
Q - Which of the following sources did you use to research your recent cell phone purchase? (Total Respondents=2961) Not all answer choices included
on chart
Q - On a scale from 1 to 5, where 1 means no influence at all and 5 means significant influence, how much influence did each of the following have on
your most recent cell phone purchase? Top 2 Box (Total Respondents=2961) Source: Google/Compete Wireless Shopper Study, January 2010.
Q: Which of the following sources did you use to research? Asked of Recent Wireless Buyers, (N=1257) Google Confidential and Proprietary 14
Q: How much influence did each resource used have on your purchase? (Top 2 Box) Asked of Recent Wireless Buyers Who Used Resource,
N=variable, May 2008. Source: Wireless Shoppers Study, Google & Compete 2008.

15. Retailers Have Captured Wireless Customers
Purchase Channel for Phone Purchase
23%
Q – Where did you purchase your most recent cell phone? (Total Respondents=2961).
Online share of purchases was higher than actual due to online survey fielding. Actual online share is typically ~6% of carrier gross add
orders Google Confidential and Proprietary 15
Source: Google/Compete Wireless Shopper Study, January 2010.
Note: Traqline reports 17% of wireless phone sales through general retail stores in Q4 2009.

16. Device Focused Consumers
Online Regardless of Purchase Location
General Retailers Stepping it Up
Google Confidential and Proprietary 16

17. smartphones
Google Confidential and Proprietary 17

18. Open to Switching Carriers
Reeled in by Features
Investing More Money, More Research
Google Confidential and Proprietary 18

19. New Segment of Customers
Wireless Device Owned Prior to Current Smartphone
new smartphone
65% owners
Compete Smartphone Intelligence data. G1: Which of the following best describes the wireless device you primarily used before purchasing Google Confidential and Proprietary 19
your current smartphone? (n=1959, smartphone owners)

20. Smartphone Purchase Drives Carrier Switching
Cell
75% phone
buyers
Been with current versus
service provider 2+
years
67% Smart-
phone
buyers**
Q: How long have you been with your current wireless service provider. Google Confidential and Proprietary 20
Source: Compete Gen Pop Wireless Survey, August 2009.

21. All Attributes Valued by Smartphone Buyers
Importance of Attributes
(Smartphone vs Cell phone)
85%
Coverage area 88%
77%
Wireless provider 78%
Wireless provider customer service
69%
71% Carrier
63%
Wireless provider my family and friends use 66%
60%
Online account management
66%
50%
Specific phone model 80%
**
Operating System 42%
70%
**
Device
29%
Applications available for download 60%
**
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Smartphone Ow ner (n=704) Cell Phone Ow ner (n=1542)
Q - On a scale of 1 to 5, how important were each of the following attributes when making your most recent cell phone
purchase? (Top 2 Box) Google Confidential and Proprietary 21
(Total Respondents=2961)
Source: Google/Compete Wireless Shopper Study, January 2010.

22. Smartphone Owners Do More Research
Time Spent Researching Phone Purchase
(Smartphone Owner vs. Cell Phone Owner)
7%
4 weeks or more
17% **
1 week but less than 4 28%
weeks 25%
More than two days, but 21% Cell Phone Owner
less than one week 20% (n=1542)
Smartphone Owner
(n=704)
43%
2 days or less
38%
**
0% 10% 20% 30% 40% 50% 60%
22
Q - How much time did you spend researching your most recent cell phone purchase? (Total Respondents=2961) Google Confidential and Proprietary 22
Source: Google/Compete Wireless Shopper Study, January 2010.

23. Not All Wireless Shoppers On Board Yet
Why I Bought a Smartphone Why I Didn’t Buy a Smartphone
45% Iwith moreafeatures
wanted phone
53% Smartphone plans are
too expensive
I don’t need the features
22% I saw a new phone
I had to have 28% on a smartphone
Q - Why did you decide to make this cell phone purchase? (Total Respondents=2961) Source: Google/Compete Wireless Google Confidential and Proprietary 23
Shopper Study, January 2010.
SC4: Why haven't you purchased a smartphone? Source: Smartphone Intelligence Study, Q32009. (n=1959)

24. Open to Switching Carriers
Reeled in by Features
Investing More Money, More Research
Google Confidential and Proprietary 24

25. search
Google Confidential and Proprietary 25

26. 62% of consumers who searched for a newly
launched mobile device purchased one.
Source: Google/Compete The Value of Search for Wireless Product Launches Study, March 2010. Google Confidential and Proprietary 26
White-labeled case study based on the launch of a mobile in Q2 2009. Survey Data.

27. Search is a Compass
Increase Acquisition & Loyalty
Bridge the Gap from Queries to Sales
Google Confidential and Proprietary 27

28. Wireless buyers conduct an average of
searches during their shopping process
28
Google Confidential and Proprietary 28
Source: Google/Compete Wireless Shopper Study, January 2010. Clickstream Data.

29. Search Encompasses Mobile Device Launch
and Optimize
Capture, Learn,
Announcement
Launch
Pre-Launch
Search Queries
Average
Mobile P
hone La
unch
Time
Google Confidential and Proprietary 29
Source: Google internal data.

30. Search Directs Traffic to New Phone Sites
Search Share of Total Site Visits to New Device Product Pages
(Share of search referrals among total referrals to Carrier and OEM sites)
Google Confidential and Proprietary 30
Source: Google/Compete The Value of Search for Wireless Product Launches Study, March
2010.
White-labeled case study based on the launch of a mobile in Q2 2009. Clickstream Data.

31. Search Introduces New Customers
Percent of Searchers and Buyers
(Device term searchers and search referred buyers who were current customers or prospects of the launch carrier)
Searchers Searchers Buyers Searchers Buyers
47% 39% 56% 46%
Prospects Prospects
62%
Prospects
53% 61% 44% 54%
38% Current Current
Current Customers Customers
Customers
Announcement & Launch Post-Launch
Pre-Launch
Google Confidential and Proprietary 31
Source: Google/Compete The Value of Search for Wireless Product Launches Study, March 2010.
White-labeled case study based on the launch of a mobile in Q2 2009. Clickstream Data.

32. Visits Initiated by New Device Searches
Percent of Search Referrals from Specific Device Keywords
(Search referrals to OEM and Carrier pages, Compared to generic keywords)
Source: Google/Compete The Value of Search for Wireless Product Launches Study, March 2010. Google Confidential and Proprietary 32
White-labeled case study based on the launch of a mobile in Q2 2009. Clickstream Data.

33. 49% of Buyers Searched on Non-Brand Terms
Top 10
Non-Branded Terms
that drove to shopping cart
cell phones
prepaid cell phones hot cell phones
cell phone plans
cell phone
cell phone companies
prepaid phones
cell phone deals
prepaid cell phone plans
prepaid phone
cell phones providers
Google Confidential and 3
Proprietary 3
Google Confidential and Proprietary 33
Source: Google/Compete Wireless Shopper Study, January 2010. Clickstream Data.

34. Non-Brand Terms Convert to Sales
30%
of search-driven conversions
to Tier 1 carriers
Non-Branded
terms drove
67%
of search-driven visits to
store locator pages
Google Confidential and Proprietary 34
Source: Compete Custom Dashboards. Q3 2009.

35. Search Drives Sales, Overall
67%
Purchases made in-store by
searchers of new phone launches.
Google Confidential and Proprietary 35
Source: Google/Compete The Value of Search for Wireless Product Launches Study, March 2010.
White-labeled case study based on the launch of a mobile in Q2 2009. Survey Data.

36. Search is a Compass
Increase Acquisition & Loyalty
Bridge the Gap from Queries to Sales
Google Confidential and Proprietary 36

37. Thank you
Google Confidential and Proprietary 37