Thomas Husson the mobile web

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  • 1. The Mobile Web: Unleashing Use in a Nascent Market FDIH, Search Marketing Strategies, Scandinavia 2008 February 8th, 2008 Thomas Husson, Senior Analyst, European Mobile
  • 2. Jupiter Research: An International Research And Advisory Company Focusing On The Digital Economy • Est. 1986. Telecoms / Media / Internet Focus • Headquarters in New York. 60+ analysts in San Francisco, London, Paris, Berlin, Madrid and Scandinavia • Field regular Consumer surveys / Canvass market leading executives - Build sophisticated market forecasts • Client unlimited access to reports and analysts • Consulting and exclusive custom projects 2 © 2008 JupiterResearch, LLC
  • 3. 2008 Research Offering Personal Technology & Access Industry Focus • Broadband • Automotive • PC & Console Games • Financial Services • Personal Technology • Health • Wi-Fi Mobility • Retail • Wireless • Travel • Mobile Devices *New for 2008 • Digital Home *New for 2008 Web Technologies & Operations • Customer Service & Support Marketing & Advertising • Payments & Transactions • Advertising & Branding • Site Technologies & Operations • E-Mail Marketing • Web Globalization *New for 2007 • Online Behavior & Demographics • Mobile Media & Marketing *New for 2007 European Focus • Search Marketing • Broadband and VoIP • Social Marketing *New for 2007 • Commerce • Content & Programming Media Focus • Country Focus • Music • Digital Home • News & Information • Marketing & Advertising • Online Media & Programming • Market Forecasts • Television & Filmed Entertainment • Mobile 3 © 2008 JupiterResearch, LLC
  • 4. Reports – European Mobile • European Mobile Forecast (2007-2012) – to be published • Mobile Data Pricing – to be published • Mobile Advertising in Europe • Mobile Social Networking • Impact of the iPhone in Europe • Mobile Search: Finding Opportunities in a Nascent Market • Mobile Youth Consumer Survey: Targeting digital natives and keeping them loyal • The future of mobile browsing: leveraging the Internet model • Consumer-Created Content: Defining opportunities for mobile operators • Ad-funded mobile services: emergence of a new business model 4 © 2008 JupiterResearch, LLC
  • 5. AGENDA • What's the current reality of the mobile service market? • How are mobile Internet / search, mobile advertising and mobile social networks developing? • What are the drivers and inhibitors for the uptake of this nascent market? How quickly will it grow ? 5 © 2008 JupiterResearch, LLC
  • 6. Except 3G Early Adopters & Youth, Majority of Mobile Phone Owners Do Not Use Mobile Multimedia Services Watched a short video Sent more than 10 SMS / day Shared mobile content with friends Accessed the Internet from my mobile Listened to full music tracks Received and sent e-mails Used mobile IM With 3G phones 15-24 with mobile phones With mobile phones Watched Live TV None 0% 20% 40% 60% 80% 100% Percentage of Consumers by Phone Type Question: During the past three months, which of the following activities have you done at least once on your mobile phone? Source: JupiterResearch/Ipsos Consumer Survey (9/06), n = 3,680 (consumers with mobile phones, UK, France, Germany, Spain, Italy, and Sweden only) 6 © 2008 JupiterResearch, LLC
  • 7. Mobile Broadband Will Not Be Mass- Market Before The End of The Decade 100% Percentage of SIM Cards by 2.5G Network Generation 80% 60% 40% 3G 3.5G 20% 0% 2005 2006 2007 2008 2009 2010 2011 2.5G 71% 87% 94% 98% 100% 100% 100% 3G 6% 13% 22% 33% 45% 54% 62% 3.5G 0% 0% 1% 3% 7% 15% 26% *categories are not mutually exclusive. 3.5g is a subset of 3G, which is a subset of 2.5G, explaining why total is over 100%. 3G excludes EDGE 7 © 2008 JupiterResearch, LLC Source: JupiterResearch Mobile Forecast 10/06 (Western Europe only)
  • 8. Mobile Social Networking: From Online Players to Pure Mobile Players 8 © 2008 JupiterResearch, LLC
  • 9. Social Networkers Most Likely to Share and Upload Mobile Media Shared Mobile Photos or Video Uploaded Mobile Photos or Video 0% 20% 40% 60% 80% 100% Percentage of European Segment Average User All Networkers Frequent Networkers Question: Considering the following statements, which describe you? (Select all that apply) 9 © 2008 JupiterResearch, LLC Source: JupiterResearch Consumer Survey 4/07 n = 4,446 (UK, FR, DE, NL, DK only)
  • 10. Mobile Operators Are Slowly Moving Away from their Walled-Garden Approach Branded / Open White-label strategy approach • Drive audience • Increased and traffic revenues for • Risk of carriers dissatisfaction in • More relevant the early days answers • Position of • Consumers’ carriers in the distrust value chain 10 © 2008 JupiterResearch, LLC Source: JupiterResearch (12/06), Western Europe
  • 11. Interest in Mobile Search Still Limited, but Higher Among Online Local Search Users Denmark Netherlands France UK Germany Average 0% 10% 20% 30% 40% 50% Percentage of Segment Consumers who have searched local information online and would be interested in mobile search Consumers interested in using an Internet search engine on their mobile phone Question: Considering the following statements, which ones describe you? Please select all that apply. (Answers are shown for wanting to use an Internet search engine such as Google on a mobile phone.) 11 © 2008 JupiterResearch, LLC Source: JupiterResearch/Ipsos Consumer Survey (4/07), n = 4,446 (Denmark, France, Germany, Netherlands, and UK)
  • 12. Forty Percent of European Mobile Population Will Regularly Access Mobile Internet by 2012 (in millions) Percentage of the Mobile Population 150 100% 80% Mobile Internet Users Number of Monthly 100 60% 37% 40% 40% 50 33% 29% 24% 19% 20% 0 0% 2007 2008 2009 2010 2011 2012 Number of monthly mobile Internet users Percentage of users accessing the mobile Internet 12 © 2008 JupiterResearch, LLC Source: JupiterResearch Mobile Model, 11/07 (Western Europe)
  • 13. UK: Interesting Testbed for Innovative Consumer Internet Pricing in Europe Launch Operator Description of Pricing Date Pay monthly: £7.5 (€11) per month (1GB fair use); T-Mobile 2005 prepay: £1 (€1.5) per day (40 MB fair use) X-Series Silver at £5 (€7.5) per month (1GB fair use); unlimited Skype calls for Skype PC users, unlimited IM October to or from Windows Live Messenger or Yahoo! 3 2006 Messenger, Internet browsing; X-Series Gold at £10 (€15) per month (Silver package plus 50 hours of access to home TV with Slingbox and to home PC with Orb) May £8 (€12) capped at 30 MB per month; available to prepay Orange 2007 and post-pay users June £7.5 (€11) capped at 150 MB per month; £1 (€1.5) per day Vodafone 2007 for up to 15 MB and £2 (€3) per MB beyond that £7.5 (€11) capped at 200 MB per month; available to October O2 prepay and post-pay users; dedicated offering for 2007 iPhone users launched on November 9, 2007 13 © 2008 JupiterResearch, LLC Source: JupiterResearch (2/08); mobile operators’ reports
  • 14. Limited Willingness to Pay Will Force Operators and Content Owners to Turn to Ad- Funded Business Models Interested in services but would not pay Not willing to pay for services, but would accept ads Sharing pictures or videos with friends Listening to music Accessing Internet Receiving personal emails Accessing maps and local information Playing a game Willing to pay for new services Using Instant Messaging Watching live TV or short videos Percentage of Mobile Phone Owners Interested and Willing to Pay for New Nothing - only interested in voice/SMS Mobile Services 0% 50% 100% Question: Which of the following services would you be interested in using on your mobile phone in the next 12 months? Source: JupiterResearch/Ipsos Consumer Survey (9/07), n = 4,202 (consumers with mobile phones in France, Germany, Italy, Spain, 14 © 2008 JupiterResearch, LLC Sweden, and UK only)
  • 15. Several Business Models Are Likely To Co-Exist in an Evolving Ecosystem New Entrants’ Handset impact Manufacturers Operators’ role dilemma New Payment Non-cellular Internet methods networks Convergence Pay-per Access / Subscriptions Ad-funded Free Download 15 © 2008 JupiterResearch, LLC
  • 16. Create a Sticky Audience First. Monetize Second. BUSINESS HANDSETS MODELS & NETWORKS CLIENT PRICE EXPERIENCE A Holistic Approach to Build Market Foundations 16 © 2008 JupiterResearch, LLC Source: Jupiter Research (10/2007)
  • 17. Typical Consolidation Phase in a New Market ! Fragmented market ! Lack of internal human competencies and technology ! Strategic long term vision that mobile may well be the next advertising battleground ! Blurring of boundaries in the online advertising channel 17 © 2008 JupiterResearch, LLC
  • 18. 10 Mobile Advertising Myths 1. Penetration rate>100% 2. ~3,000,000 mobile users 3. Mobile Internet > PC Internet Users 4. Multimedia messaging is dead 5. Triple digit growth 6. Mobile TV is about to be mass-market 7. Mobile advertising ~ > 20,000,000,000 $ 8. Operators’ inventory ~x00,000,000 impressions 9. Click Through Rates on mobile >>> Internet 10.Mobile 2.0 18 © 2008 JupiterResearch, LLC
  • 19. Advertising on Personal Phones Is A Double-Edged Sword Mobile phone owners, ages 15 2% 35% 17% 19% 22% 5% to 24 Overall mobile 3% 47% 18% 14% 14% 4% phone owners 0% 20% 40% 60% 80% 100% Percentage of Segment Don't know Strongly disagree Somewhat disagree Neutral Somewhat agree Strongly agree Question: Do you agree with the following statement: I would like to receive promotions and advertising on my phone if they are relevant to me and will help me save money? Source: JupiterResearch/Ipsos Consumer Survey (9/06), n = 3,680 (consumers with mobile phones, UK, France, Germany, 19 © 2008 JupiterResearch, LLC Italy, Spain, and Sweden only)
  • 20. SMS Marketing Is Only Mass-Reach Mobile Marketing Option Marketing Monthly Audience Capabilities at End of 2007 Simple messaging: SMS active users: 160-character black- 74% (234 million) and-white text-based SMS messaging MMS active users: 29% (92 million) Mobile Internet active users: 19% (60 million) Enhanced messaging (plus Mobile video/TV content and services): active users: dynamic/interactive/ 7% (22 million) audiovisual content/ services/applications, Mobile search active users: short video clips, sponsored less than 4% (14 million) links and keywords Source: JupiterResearch Mobile Model, 10/06 (Western Europe); JupiterResearch Mobile Marketing and Advertising Model, 20 © 2008 JupiterResearch, LLC 11/07 (Western Europe)
  • 21. Lack of Strategic Integration and Implementation Complexities Will Stifle Mobile Marketing’s Potential in Short Term Lack of Campaign Lack of strategic execution interoperable integration in the complexities measurement and Limited marketing mix performance tools audience Mobile Advertising Spending Individual, Growing Growing contextual Consumers’ inventory and interest of (location-based), uptake of data choice of ad advertisers and behavioral services formats targeting capabilities 21 © 2008 JupiterResearch, LLC Source: JupiterResearch (12/07)
  • 22. Advertisers Plan to Use Many Different Tactics Including Banner Ads, Sponsored Links SMS marketing messages WAP-push marketing MMS images Messaging MMS video Branded mobile content (e.g., logos, games) Banner ads on mobile portals Banner ads on off-portal mobile Internet pages Branded mobile applications Sponsored links within mobile search Ad-supported content or services Mobile coupons or bar codes Content sponsorships or advertorials In-stream video ads Having used tactic during past 12 months Ads on mobile location-based services Planning to use tactic Other during next 12 months 0% 20% 40% 60% 80% 100% Question: Which mobile marketing and advertising tactics Percentage of Mobile Marketing Decision Makers have you used during the past 12 months, and which do you Having Used or Planning to Use Mobile Marketing plan to use during the next 12 months? Select all that apply. Source: JupiterResearch Mobile Marketing and Advertising Executive Survey (7/07), n = 50 (mobile marketing decision 22 © 2008 JupiterResearch, LLC makers having used or planning to use mobile marketing, Western Europe)
  • 23. 2006 Mobile Advertising Revenues ~240M € in the Advanced Japanese Market* • 3G =64% penetration rate* • Mobile Internet =87% penetration rate** 23 © 2008 JupiterResearch, LLC Source: * Dentsu, ** Japanese Ministry of Internal Affairs and Communications
  • 24. Stakeholders Must Implement Measurement and ROI Standards to Boost Market Uptake Allocation of budget Measurement technology High cost of inventory Lack of inventory Selection of best tactics Coordination with other media Lack of audience Selection of best inventory Trafficking technology Mobile landing page production Trafficking processes Measurement issues Measurement and reporting strategies Cost/reach issues Data protection and privacy Other Mobile creative development Poor performance 0% 20% 40% 60% 80% 100% Percentage of Mobile Marketing Decision Makers Having Used Mobile Marketing Question: Which of the following problems have you experienced in relation to your mobile marketing efforts? Select all that apply. Source: JupiterResearch Mobile Marketing and Advertising Executive Survey (7/07), n = 34 (mobile marketing decision 24 © 2008 JupiterResearch, LLC makers having used mobile marketing, Western Europe)
  • 25. Key Takeaways ! Online Trends in the maturing web market are expanding in the nascent mobile space ! Barriers will be removed or lessened in the next few years: more affordable data plans, good enough mobile broadband experience, compelling handsets !However, today mobile multimedia services are only on their way to reach critical mass ! Mobile Advertising is still in its infancy and will remain in an educational / standardization phase in the next 2/3 years 25 © 2008 JupiterResearch, LLC
  • 26. Thank You for you attention Questions ? thusson@jupiterresearch.com