(Graham Brown mobileYouth) American Youth - Cell Phones and Mobile Culture by MobileYouthAmerica.com

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  • Which 5 key trends in youth mobile culture do you need to know about today? Cell phone ownership, spending trends, influence and innovation.
  • Which 5 key trends in youth mobile culture do you need to know about today? Cell phone ownership, spending trends, influence and innovation.
  • As you can probably see and hear I’m near American nor Youth, so how am I qualified to be here today? Well, I may look 38 but I’m actually 21… But seriously, we established mobileYouth in 2001 when the idea of young people using cell phones was unheard of in the West. But since then we’ve grown and now work with companies all over the world – from the USA to Brazil to South Africa to Japan. Consequently, we’ve need to expand our research partnerships and in 2007 we formed the Youth Research Partners – a network of likeminded youth agencies which now is operational in 25 countries. 2 YRPs are based here in the USA – and it’s their on the grounds, local insights of American youth mobile culture I’ll be sharing today. I have some insights which I think you’ll have never seen before – stuff which may leave you with more questions than answers. This is what we love doing here at mobileyouth – we’re cultural observers. I’m the kind of guy who will sit in a café and take in the body language of everybody sitting in the room. Have you ever done that? The better you get at it the better you are at reading cultural codes – such as “who is the leader of this group?”, “what is she *really* saying?”, “why is he sitting like that?” So, if you’re also curious like me then I hope you’ll enjoy the next 30 minutes as we take part in a whirlwind journey into the world of American Youth Culture
  • And it started here. This is where I got my start – back in 1995 in Japan when I was living in Tokyo at the very beginnings of youth mobile culture. Cast your mind back to 1995 – Windows 95 – how that changed the world. At the time I was working for an IT company in Tokyo translating training manuals. They had just launched a new pager. The japanese called them “Pocket Bells” or in short “Pokeberu”. We were trying to work out how to educate users about how to use them. What was really interesting was we found that execs were lending them to their kids to keep in touch with them. Before long, retailers started reporting that high school girls were coming into the stores and asking for Pokeberus. They were totally unprepared. Until then everything was black, monolithic and without any thought to design. So these girls were buying them and decorating them. But here’s what’s really interesting and this is how the seed for mobileYouth was sown almost 15 years ago. They weren’t just hacking the designs, they were using them in a very strange way. Girls were typing in code. If they said “Meet me in Shibuya” they would type in “428” – Shi Bu Ya And when this first happened, many observers overlooked it – it was just youth folly and excess. But for me as an observer, events like this provide us with fascinating insights into not just youth mobile culture But also youth psychology and sociology
  • Because if you have any contact with youth in your daily work – marketing, PD or consumer insights You need to know this – Positive Deviance. If you understand +D you can create far more effective marketing campaigns, improve your Product launch hit rates, reduce customer attrition, generate word of mouth and develop innovative products. +D is the reason why you are working with youth. So what is +D? You give a mobile phone to an adult and tell her it’s to make phone calls, she’ll do as you say. You give a mobile phone to young people and tell them it’s to make phone calls, they’ll look for ways to do it a) better b) cheaper or c) in a way that gives them control of the medium. Why? Social Currency. How can this help me belong? How can this help me connect? Think about all the innovation in the last decade in the field of communication. Positive deviance gave us Napster, SMS, Facebook and now BBM. Think about it – the answers to “the next big thing are out there” – you just have to know how to build dialogue with youth to ask the right questions
  • And asking the right questions is what we’re all about We’ve been helping clients like these build better dialogue with young people And learning a lot ourselves along the way. Everytime we work with an MTV or a Nokia we learn better ways of doing things which we then add to the collective knowledge
  • That it helps understand the emotional relationship. Remember I said I was an observer, a psychologist and cultural anthropologist. I wanted to know why those girls in Japan were corrupting the Pokeberu. I wanted to know why kids in America are dumping SMS and using BBM. I wanted to know why students love Apple and not Motorola. It’s at the Emotional level we get those answers and I’ll share my findings with you today
  • Because, while we all talk about “youth still watch TV”, they’re not taking their TVs to bed with them are they? 60% of American youth sleep with their phone. I mean sleep with it in the bed or next to the bed. Now that’s engagement. So what got us here and what does that mean for us marketers? To answer that question, take a look at the YMA download – link at the end. But for the purposes of today, I’ve taken 5 of those 50 trends in the original document to provide some key takeaways for today
  • The most important jumping off point for our journey into YMC is that there isn’t really 1 youth market – particularly with mobile phones. You can’t talk about 15-24 yr olds without understanding the key differences between a 15 and 24 year old. So let’s start there
  • You can split the youth market 2 ways. Firstly by age and crudely speaking 10-19 then 20-29. The second split is the vertical split – that within any age group there are influencers and followers. I’ll talk about those later and why they are key to your marketing. Let’s start with the 2 tier market. What do 10-19 year olds think about brands? Start with one of the strongest youth mobile brands - Nokia
  • My Opinion… These are insights gathered by Premise, our YRP on the West. You don’t get these kind of insights from a FG Now compare that to the 2 nd tier – 20-29
  • Notice the key difference. This is a trend that has been consistent in these 2 tiers. 20-29 yr olds grew up with Nokia and Motorola. They remember them fondly. They remember Snake, their first cell phone, the V3, Startac and so on. They have an emotional attachment to the brands, the device. But for 10-19 yr olds it couldn’t be further from the truth. They couldn’t care less. We’ll look at key data on brand affinity shortly. So the first trend is to realize you are talking about multiple markets in the YM One key undercurrent is that the next generation are growing up without any attachment to the brands we saw as key players in the mobile market I want to set the scene for the mobile market here today in the US
  • And why growth lies in optimizing marketing rather than growing market share. In short, there is no more money to be had from young people, they’ve reached their ceiling Take a look at the data from the 2011 mobile youth report
  • Top left – youth mobile ownership has hit a plateau. Every young person has 1 (and in some cases 2 phones). At the bottom are the revenues. 2011 we peak at young people spending $70 bn annually. So if you’re in the telecoms sector or working for handset/operator clients realize this – their future growth story doesn’t lie in getting more young people onto their network but maximizing the profitability from existing ones. Rather than Average Revenue we need to be looking at Average Margin. The companies that can lower Account Mgt, SAC, Churn rates, Marketing Waste are the ones that will win in the next 10 years of YMC. And this means more focus on building deeper relationships with young people rather than big idea advertising that wins more customers to the brand. Which is great, because it means we have to start understanding young people and being a part of their conversation Which is important because what they say about our brands are far more important than what we say
  • Trend 3. Paid vs Earned Media. Last 10 years – how did we sell mobile to young people. Imagine you are a mobile company – Motorola. You have a new handset. What’s different about your handset. The design? Ok hire a cool creative agency. Tell them to go long on promoting this point of difference. Hire a celebrity – Shaq, Kanye West, Britney or Beckham. That’s the formula right? That’s what Paid Media is about. Yet, here’s what’s interesting. Paid Media is no longer the driving force it once was in influencing young people to buy mobile brands
  • Take a look at the US. The lighter line shows youth who buy smartphones because of Paid Media. The darker line Earned Media. Now every year the gap has narrowed until next year EM will overtake PM That means, more young people will buy smartphones in 2012 because of EM rather than PM. And in many countries this is already the case. So it’s interesting isn’t it – we are throwing billions into the PM blackhole but it’s only a matter of time before that coffee aroma starts filling the meeting room. If you want to sell your products, you need to focus on E not PM. So how do you do that? Everyone says “we cant measure social media” etc etc… Well I want to show you a very simple way you can.
  • Clients would ask – we want to focus more on EM but how do we measure it? So we started looking around for available metrics. There were a few, we started researching them and narrowing down the most reliable ones. We then grouped them into EMI and the results will surprise you. The old saw is that ad execs often boast they know that half of their advertising is measurable – they just don’t know which half. Well with youth EMI you can track exactly what next quarter’s market share will be – how about that – before it has even happened? Based on this one premise – are youth recommending you to their friends or not?
  • And in Motorola’s case take a look at this data. The dark line denotes Market Share. The lighter line an EMI – in this case OPS – a simple metric that measures recommendation levels for the brand. What do we find? If OPS falls, market share follows.
  • This is even more noticable in Apples case. Look how EMI predict the acceleration of the market share over the course of the year. So, we now that we had found a better correlation of what young people were saying and brand performance, the question was – could we use this information to actually improve a youth brand performance?
  • And this is where it gets really interesting because most of this data is not publicly available due to its sensitive commercial nature but What I will do is share what I can to make this interesting for you So the challenge is this – 1) We know EM is becoming the most important driver of youth handset sales 2) And we know that EM can be measure through an EMI like OPS 3) How can we use this information to improve the performance of any brand And this comes to our 5 th trend – Liked vs Loved You know, I do a lot of presentations and from time to time people come up to me and say “But we surveyed young people and 85% of them liked our brand” My answer? If they like you, be afraid, be very afraid. Because young people don’t talk about brands they like, they talk about brands they love. They talk about Jet Blue, Monster Energy, Threadless, Jones Soda, Toyota Scion, Apple, Blackberry and Boost Mobile. They don’t talk about brands they Fan on Facebook just because they clicked the like button do they? Real earned media means being Loved not Liked. Being Liked is as good as Being Invisible. So, we were interested to know – if we talked to young people and asked them about the brands they loved – ie the brands they would recommend to friends, which handsets would they rank at the top?
  • Here’s some research which is not yet live but was conducted with our local YRP Mr Youth You know, it’s no good saying “65% of youth have smartphones”. So what? Tell me how that affects the conversations. So this is what we have been doing. We broke down the handset preferences by age and calculated net EMI scores. So if 80 youth recommended Apple and 20 didn’t – their Net EMI would be 60%. And this is where it gets interesting, because for each age group there are differences. Every body says “Well Apple and BB are only 8% of the market share. But consider this. 8% of the MS, 22% of the revenues. 62% of profits” You can correlate profits directly with Net EMI. The most profitable handset brands on the left, the least profitable on the right. Remember I spoke briefly about Less Wasteful Marketing? So what do you do if you are a Motorola? Knee jerk reaction is – “Hey 15-19 year olds don’t dig us anymore, let’s get down with them” To which I’ll say…
  • Build a beachhead where youth are most receptive. Motorola needs to be focusing on 20-24 yr olds. Preferably males. That’s where their EM budget should concentrate its efforts, on campus, young people starting out in the working world. Remember those high school girls in Japan?
  • Could Motorola
  • Which 5 key trends in youth mobile culture do you need to know about today? Cell phone ownership, spending trends, influence and innovation.