iMonitor™Trends & Best PracticesMarch, 2011                          © McPheters & Company, 2011
BACKGROUND                    •  iMonitor™ was launched in June 2010 to allow publishers                       and agencie...
•  Each app is subjected to rigorous evaluation and rated                       on a 5-point scale for:                   ...
BY THE END OF FEBRUARY, THE NUMBER OF      APPS TRACKED BY IMONITOR SURPASSED      1400.© McPheters & Company, 2011       ...
IT IS STILL VERY EARLY…                               •  Tablet adoption                               •  App development©...
THE U.S. MARKET                                By 2015, the number of tablet users in the U.S. will be                    ...
THE IMPORTANCE OF BEING APPLE                 •  Apple is expected to retain a 60-70% share of tablet sales               ...
APPLE DOMINATES THE APP MARKETPLACE, PROVIDING YET      ANOTHER REASON FOR CONSUMERS TO PREFER THE iPAD.        Source: La...
•  Not surprisingly, the evolution in the experience these                       apps provide consumers since the iPad’s i...
DISTRIBUTION OF PUBLICATION      -RELATED APPS BY MEDIUM IN THE U.S.                              Print Mags   Digital Mag...
MOST MAGAZINE APPS ARE STILL REPLICAS.                                       % Portrait and Landscape Same or Single Page/...
IN U.S. WHO’S THERE; WHO’S MISSING             PRESENT                                 ABSENT             •  All major nat...
Most major U.S. magazines have a dual revenue model, while     among newspapers, an ad-based model is slightly more     pr...
Most major U.S. magazines derive their consumer revenue from sales of     individual issues – with less than 20% offering ...
Among major U.S. magazines, apps typically carry a price upon     introduction which includes the first issue. When the se...
What we refer to as a print advertising model is dominant for     magazines, while other app types are more likely to offe...
LINKS ARE THE MOST COMMON       FORM OF AD ENHANCEMENTS.                                                                  ...
WHAT MAKES                              A GREAT APP?© McPheters & Company, 2011                  18
A GREAT APP PROVIDES A SIGNIFICANTLY     ENHANCED EXPERIENCE                    WELL DESIGNED                    •  Has fe...
A GREAT APP PROVIDES A SIGNIFICANTLY      ENHANCED EXPERIENCE                   HIGHLY FUNCTIONAL                   •  Dri...
A GREAT APP PROVIDES A SIGNIFICANTLY       ENHANCED EXPERIENCE                    LOTS OF RICH MEDIA CONTENT              ...
BEST CONSUMER APPS                                                                iMonitor	                               ...
TOP APPS IN CONSUMER TRACTION (FEB.)      Free	                                  Rank	   Chg.	          Paid	             ...
KEY DRIVERS OF CONSUMER TRACTION               •  Apps are of high quality with average iMonitor™ rating of               ...
PLATFORMS/DEVELOPMENT PARTNERS                                       Multi-publisher developers active in the U.S.     Top...
No matter how good the development partner, quality control       is essential and is the responsibility of the publisher....
MAJOR TRENDS© McPheters & Company, 2011           27
MAJOR TRENDS                    •  Redefinition and convergence                    •  Social media (used by 41.7%)        ...
REDEFINITION & CONVERGENCE                    •  Recent introductions, such as Project and POST Matter,                   ...
REDEFINITION                   PROJECT© McPheters & Company, 2011        30
REDEFINITION                              FRANKFURTER RUNDSCHAU© McPheters & Company, 2011                           31
CONVERGENCE                              THE NEW YORK DAILY NEWS© McPheters & Company, 2011                             32
CONVERGENCE                              ABC, BBC, & CBS© McPheters & Company, 2011                     33
SOCIAL MEDIA                     THE NEW YORK POST© McPheters & Company, 2011              34
SOCIAL MEDIA                     CHEVY – VANITY FAIR© McPheters & Company, 2011                35
SHOPPING LISTS© McPheters & Company, 2011   36
SHOPPING LISTS & TRANSACTIONAL CAPABILITIES      GLAMOUR© McPheters & Company, 2011                         37
SHOPPING LISTS & TRANSACTIONAL CAPABILITIES                              OPRAH© McPheters & Company, 2011                 ...
MULTIPLE VERSIONS         FT                              PROJECT© McPheters & Company, 2011             39
LANGUAGE                   JPM Magazine© McPheters & Company, 2011       40
LOCALIZATION                              AT&T – SPORTS ILLUSTRATED© McPheters & Company, 2011                            ...
LOCALIZATION                              NEWSDAY© McPheters & Company, 2011             42
VOICE RECOGNITION© McPheters & Company, 2011   43
We give higher ratings to apps that optimize viewing       separately for portrait and landscape.                         ...
Among major U.S. magazines, and to a lesser extent       international ones as well, we are seeing a trend towards the    ...
WHAT MAKES    GREAT ADVERTISING?© McPheters & Company, 2011   46
LIKE A GREAT APP, A GREAT AD PROVIDES A   SIGNIFICANTLY ENHANCED MAGAZINE   EXPERIENCE                    •  Added opportu...
EXAMPLES                    MARTHA STEWART LIVING© McPheters & Company, 2011                 48
North Face     EXAMPLES             NORTH FACE© McPheters & Company, 2011   49
Examples      EXAMPLES     RALPH LAUREN             IBM© McPheters & Company, 2011         50
EXAMPLES         ABC FAMILY© McPheters & Company, 2011   51
APPS WILL RULE                    •  Tablet penetration is a fraction of what it will be by the                       end ...
IT IS STILL VERY EARLY…© McPheters & Company, 2011    53
THE END© McPheters & Company, 2011             54
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Tablet Metrics From iMonitor

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Tablet Metrics From iMonitor

  1. 1. iMonitor™Trends & Best PracticesMarch, 2011 © McPheters & Company, 2011
  2. 2. BACKGROUND •  iMonitor™ was launched in June 2010 to allow publishers and agencies to share the cost of thoroughly monitoring developments in tablet apps. •  iMonitor uses more than 100 variables to track iPad apps for: — All magazines released globally — National newspapers in English-speaking and Western European countries — Other news apps which compete with national newspapers — and magazines — Companion apps •  We also track which other platforms these publishers are using and pricing across all platforms© McPheters & Company, 2011 2
  3. 3. •  Each app is subjected to rigorous evaluation and rated on a 5-point scale for: — Design — Functionality — Media — Advertising, if applicable •  We roll the first 3 into the iMonitor™ App Rating •  As of today, we have evaluated more than 1500 apps – most more than once.© McPheters & Company, 2011 3
  4. 4. BY THE END OF FEBRUARY, THE NUMBER OF APPS TRACKED BY IMONITOR SURPASSED 1400.© McPheters & Company, 2011 4
  5. 5. IT IS STILL VERY EARLY… •  Tablet adoption •  App development© McPheters & Company, 2011 5
  6. 6. THE U.S. MARKET By 2015, the number of tablet users in the U.S. will be almost 7 times current levels. Source: Forrester; McPheters & Company estimate of users in 2010 & 2011.© McPheters & Company, 2011 6
  7. 7. THE IMPORTANCE OF BEING APPLE •  Apple is expected to retain a 60-70% share of tablet sales through 2012 •  To date, competitors to the iPad have failed to get traction •  According to Laptop Magazine, a recent survey of tech -savvy consumers indicated: — 20% already have an iPad — 20% more expect to purchase an iPad — 7% expect to purchase another tablet — 53% don’t (yet) want a tablet© McPheters & Company, 2011 7
  8. 8. APPLE DOMINATES THE APP MARKETPLACE, PROVIDING YET ANOTHER REASON FOR CONSUMERS TO PREFER THE iPAD. Source: Laptop Magazine; 148Apps,Google, RIM, Precentral© McPheters & Company, 2011 8
  9. 9. •  Not surprisingly, the evolution in the experience these apps provide consumers since the iPad’s introduction has been enormous. •  Nonetheless, we still find that 44% have significant glitches that negatively affect the user experience. — Download issues — Crashes — Failed links — Faulty video — Difficult page turns© McPheters & Company, 2011 9
  10. 10. DISTRIBUTION OF PUBLICATION -RELATED APPS BY MEDIUM IN THE U.S. Print Mags Digital Mags Newspapers Other News Companions© McPheters & Company, 2011 10
  11. 11. MOST MAGAZINE APPS ARE STILL REPLICAS. % Portrait and Landscape Same or Single Page/Spread 100% 90% 86% 86% 83% 84% 82% 80% 79% 80% 76% 72% 68% 67% 70% 64% 63% 60% 57% 50% 47% 44% 43% 40% 36% 30% 20% 10% 0% 9/27 10/25 11/29 12/23 1/27 2/25 MRI-Measured U.S. Magazines Non-Measured U.S. Magazines International Magazines Source: iMonitor 2/25; Base: Apps containing advertising© McPheters & Company, 2011 11
  12. 12. IN U.S. WHO’S THERE; WHO’S MISSING PRESENT ABSENT •  All major national newspapers •  Bauer (4 foreign titles) •  51 MRI-Measured Magazines •  Meredith (3 companions) (MRI, other pubs, companions) •  Wenner — American Express (2, 0, 0) — AMI (2, 0, 1) — Bonnier (4, 7, 1) — Condé Nast (7, 2, 4) — Hachette (2, 0,1 ) — Hearst (4, 0, 4) — MSLO (2, 0, 1) — National Geographic (2, 0, 6) — Rodale (4, 1, 1) — Source Interlink (2, 0, 1) — Time (4, 0, 8) — Other titles (16, 0, 7)© McPheters & Company, 2011 12
  13. 13. Most major U.S. magazines have a dual revenue model, while among newspapers, an ad-based model is slightly more prevalent. Revenue Model 90% 80% 77% 71% 70% 60% 57% 56% 50% 39% 40% 33% 33% 30% 30% 20% 19% 20% 14% 14% 11% 11% 10% 4% 5% 5% 0% 0% 0% 0% Consumer + Ad Consumer Only Ad Only Neither MRI-Measured U.S. Magazines Non-Measured U.S. Magazines U.S. Newspapers U.S. Companions Other U.S. News Apps Source: iMonitor 2/25© McPheters & Company, 2011 13
  14. 14. Most major U.S. magazines derive their consumer revenue from sales of individual issues – with less than 20% offering subscriptions. Newspapers are more likely to derive consumer revenues from apps and subscriptions. Consumer Revenue 100% 90% 86% 80% 74% 70% 66% 67% 62% 60% 51% 50% 40% 34% 33% 30% 28% 22% 17% 15% 19% 20% 14% 15% 13% 11% 10% 8% 8%9% 7% 7% 7% 7% 7% 2%0% 0% 0% 0% 2% 2%0%0% 0% 0% App + Internal App Only Internal Only Issue Sub Other None MRI-Measured U.S. Magazines Non-Measured U.S. Magazines U.S. Newspapers U.S. Companions Other U.S. News Apps Source: iMonitor 2/25© McPheters & Company, 2011 14
  15. 15. Among major U.S. magazines, apps typically carry a price upon introduction which includes the first issue. When the second issue is released, the app becomes free and the issue is sold within the app. Distribution of Prices, MRI-Measured Magazines 100% 90% 85% 80% 70% 60% 50% 40% 28% 30% 23% 19% 20% 15% 10% 6% 6% 8% 2% 0% 2% 0% 2% 4% 0% 2% 0% 0% 0% Free $0.99 $1.99 $2.99 $3.50 $3.99 $4.99 5.99 NA App Issue© McPheters & Company, 2011 15
  16. 16. What we refer to as a print advertising model is dominant for magazines, while other app types are more likely to offer sponsored or premium opportunities for advertisers. Ad Model 90% 81% 80% 70% 62% 60% 50% 44% 40% 36% 33% 36% 31% 30% 25% 20% 14% 10% 11% 11% 11% 10% 11% 10% 7% 6% 4% 1% 0% 0% None Print Premium Sponsored MRI-Measured U.S. Magazines Non-Measured U.S. Magazines U.S. Newspapers U.S. Companions Other U.S. News Apps Source: iMonitor 2/25© McPheters & Company, 2011 16
  17. 17. LINKS ARE THE MOST COMMON FORM OF AD ENHANCEMENTS. Ad Enhancements 100% 100% 90% 84% 83% 82% 80% 74% 70% 63% 60% 55% 50% 40% 33% 33% 30% 25% 22% 20% 17% 17% 14% 10% 11% 8% 10% 5% 0% 0% 1% 0% 0% 0% 2% 0% None Web Links Audio Video Interactivity MRI-Measured U.S. Magazines Non-Measured U.S. Magazines U.S. Newspapers U.S. Companions Other U.S. News Apps Source: iMonitor 2/25; Base: Apps containing advertising© McPheters & Company, 2011 17
  18. 18. WHAT MAKES A GREAT APP?© McPheters & Company, 2011 18
  19. 19. A GREAT APP PROVIDES A SIGNIFICANTLY ENHANCED EXPERIENCE WELL DESIGNED •  Has features which make it easy to navigate app, issue, sections (newspapers), and articles •  Optimized for orientation •  Extra points awarded for — Subscriptions — Unique features such as: • Glamour’s Shopping List • Hearst’s Cookie Carousel • SI’s Wheel • The Daily’s article shuffle© McPheters & Company, 2011 19
  20. 20. A GREAT APP PROVIDES A SIGNIFICANTLY ENHANCED EXPERIENCE HIGHLY FUNCTIONAL •  Driven by adherence to evolving set of best practices related to time and resource conservation — Reasonable download time — In-app purchase — Navigation guide — Internal browser — Resumable download and reading — Ability to delete issues •  Points added for unique features such as — Macumag: Adjust screen brightness within app — TELE: Clear cache from settings — Sunday Times of London: Download and delete by section — Quattroruote: Navigation guide overlaid on page •  Points deducted for replicable malfunctions© McPheters & Company, 2011 20
  21. 21. A GREAT APP PROVIDES A SIGNIFICANTLY ENHANCED EXPERIENCE LOTS OF RICH MEDIA CONTENT •  Points added for various types of features (links, audio, video, animation, social media, live newsfeeds, localization, interactivity, transactional capabilities) •  Points added for unique media features — EPICURIOUS RECIPES & SHOPPING LIST: Create shopping list for multiple recipes — EVERYDAY FOOD: Send recipes via text message — GEO MAG N°4: speak a countrys name to bring up photo gallery — NY POST: Design your own cover for the day’s newspaper© McPheters & Company, 2011 21
  22. 22. BEST CONSUMER APPS iMonitor   iMonitor   BEST  APPS  –  U.S.   App  Ra6ng   BEST  APPS  -­‐  INTERNATIONAL   App  Ra6ng   CBS  News  for  iPad   14.5   Focus  Magazine   14.5   USA  TODAY  for  iPad   14   CHIP   14   FOOD  &  WINE   13.5   Story  Magazin   14   Intelligent  Life   13.5   T3   14   The  Wall  Street  Journal.   13.5   Project  Magazine   14   The  Washington  Post  for  iPad   13.5   Sunday  Times   14   Martha  Stewart  Makes  Cookies   13.5   Good  Food  Magazine   13.5   ELLE  US   13   Weekend  Magazin   13.5   FORTUNE  Magazine   13   Andaman  365º   13.5   Glamour  Magazine   13   iMAG  Magazine   13.5   Golf  Digest  Magazine   13   ZEIT  ONLINE  plus   13.5   TIME  Magazine   13   Harvey  Norman  Recipe  Organiser   13.5   New  York  Post   13   Etapes  HD   13.5   ABC  News  for  iPad   13   elmundo.es  for  iPad   13.5   AP  News   13   News  Magazin   13   Epicurious  Recipes  &  Shopping  List   13   Schweizer  Illustrierte  eMagazin   13   Marie  Claire  Fall  Fashion  A  to  Z   13   Suomen  KuvalehS   13   JPM  Magazine   13   Financial  Times  iPad  EdiSon   13   Frankfurter  Rundschau   13  © McPheters & Company, 2011 22
  23. 23. TOP APPS IN CONSUMER TRACTION (FEB.) Free   Rank   Chg.   Paid   Rank   Chg.   Gross  $   Rank   Chg.   New   No   No   The  Daily   1   New  York  Post   1   New  York  Post   1   Release   Change   Change   New   CNN  App  for  iPad   2   -­‐1   60  Minutes  for  iPad   2   1   The  Daily   2   Release   In  the  Kitchen:  Food  Network   No   USA  TODAY  for  iPad   3   Recipes,  Chefs,  Cooking  Tools   3   -­‐1   PEOPLE  Magazine   3   -­‐1   Change   and  Shopping  Lists   O,  The  Oprah  Magazine   The  New  Yorker   NYTimes  for  iPad   4   -­‐2   4   1   4   1   February  2011   Magazine   No   New   PEOPLE  Magazine   5   Vogue   5   NYTimes  Crosswords   5   -­‐2   Change   Release   New  York  Daily  News  iPad   New  York  Daily  News   The  Wall  Street  Journal.   6   -­‐2   6   -­‐2   6   1   version   iPad  version   O,  The  Oprah  Magazine   New   Sports  Illustrated   ABC  News  for  iPad   7   -­‐1   7   7   8   March  2011   Release   Magazine   Epicurious  Recipes  &   No   Martha  Stewart  Makes   Not   8   8   6   Popular  Science+   8   Shopping  List   Change   Cookies   Ranked   Ul6mate  Dinopedia:  The   No   NPR  for  iPad   9   -­‐2   Most  Complete  Dinosaur   9   2   WIRED  Magazine   9   Change   Reference  Ever   Martha  Stewart   Not   The  Economist  on  iPad   10   -­‐1   Popular  Science+   10   Living  Magazine  for   10   -­‐2   Ranked   iPad  © McPheters & Company, 2011 23
  24. 24. KEY DRIVERS OF CONSUMER TRACTION •  Apps are of high quality with average iMonitor™ rating of 11.5 vs. average of 8.5. •  Issue/update frequency •  Availability of subscriptions •  Little correlation with print circulation •  More to do with nature of the audience© McPheters & Company, 2011 24
  25. 25. PLATFORMS/DEVELOPMENT PARTNERS Multi-publisher developers active in the U.S. Top Range # of Apps Avg. App Avg. Design Avg. Avg. Media Rating Rating Function Rating Rating Woodwing 120 10.6 3.8 4.0 2.8 Adobe 82 10.3 3.5 3.9 2.9 Zinio LLC 14 9.5 3.7 4.1 1.7 YUDU Ltd 20 9.3 3.1 4.4 1.8 Texterity Inc. 67 8.8 3.1 3.7 2.0 Pixelmags 127 8.7 2.8 4.8 1.1 BlueToad, Inc. 57 7.8 2.7 4.2 0.8© McPheters & Company, 2011 25
  26. 26. No matter how good the development partner, quality control is essential and is the responsibility of the publisher. Minimum & Maximum Ratings 15.0 14.0 14.0 12.5 12.5 12.0 11.0 10.5 9.5 9.0 8.0 7.0 7.0 6.5 6.0 6.0 6.0 5.0 3.0 0.0 Woodwing Adobe Zinio LLC YUDU Ltd Texterity Inc. Pixelmags BlueToad, Inc. Min App Rating Max App Rating© McPheters & Company, 2011 26
  27. 27. MAJOR TRENDS© McPheters & Company, 2011 27
  28. 28. MAJOR TRENDS •  Redefinition and convergence •  Social media (used by 41.7%) •  Transactional capabilities (used by 15.3%) •  Localization (used by 2.8%) •  Shopping lists (used by 0.2%) •  Voice recognition (used by 0.1%) •  Move towards fixed orientation© McPheters & Company, 2011 28
  29. 29. REDEFINITION & CONVERGENCE •  Recent introductions, such as Project and POST Matter, expand our perception of a magazine •  Frankfurter Rundschau redefines the daily newspaper so that it’s indistinguishable from a magazine •  Convergence is especially notable in the news category, where apps from newspapers, magazines, TV, radio and web-based brands compete directly© McPheters & Company, 2011 29
  30. 30. REDEFINITION PROJECT© McPheters & Company, 2011 30
  31. 31. REDEFINITION FRANKFURTER RUNDSCHAU© McPheters & Company, 2011 31
  32. 32. CONVERGENCE THE NEW YORK DAILY NEWS© McPheters & Company, 2011 32
  33. 33. CONVERGENCE ABC, BBC, & CBS© McPheters & Company, 2011 33
  34. 34. SOCIAL MEDIA THE NEW YORK POST© McPheters & Company, 2011 34
  35. 35. SOCIAL MEDIA CHEVY – VANITY FAIR© McPheters & Company, 2011 35
  36. 36. SHOPPING LISTS© McPheters & Company, 2011 36
  37. 37. SHOPPING LISTS & TRANSACTIONAL CAPABILITIES GLAMOUR© McPheters & Company, 2011 37
  38. 38. SHOPPING LISTS & TRANSACTIONAL CAPABILITIES OPRAH© McPheters & Company, 2011 38
  39. 39. MULTIPLE VERSIONS FT PROJECT© McPheters & Company, 2011 39
  40. 40. LANGUAGE JPM Magazine© McPheters & Company, 2011 40
  41. 41. LOCALIZATION AT&T – SPORTS ILLUSTRATED© McPheters & Company, 2011 41
  42. 42. LOCALIZATION NEWSDAY© McPheters & Company, 2011 42
  43. 43. VOICE RECOGNITION© McPheters & Company, 2011 43
  44. 44. We give higher ratings to apps that optimize viewing separately for portrait and landscape. % Magazines Optimizing Layout for Both Portrait & Landscape 40% 38% 38% 37% 35% 35% 32% 30% 23% 20% 20% 20% 18% 15% 13% 12% 12% 9% 10% 10% 8% 8% 0% 9/27 10/25 11/29 12/23 1/27 2/25 MRI-Measured U.S. Magazines Non-Measured U.S. Magazines International Magazines Source: iMonitor 2/25; Base: Apps containing advertising© McPheters & Company, 2011 44
  45. 45. Among major U.S. magazines, and to a lesser extent international ones as well, we are seeing a trend towards the use of a fixed orientation. % Magazines Using A Fixed Orientation 30% 26% 22% 21% 21% 20% 13% 13% 12% 11% 10% 9% 9% 8% 8% 7% 7% 7% 6% 5% 0% 0% 9/27 10/25 11/29 12/23 1/27 2/25 MRI-Measured U.S. Magazines Non-Measured U.S. Magazines International Magazines Source: iMonitor 2/25; Base: Apps containing advertising© McPheters & Company, 2011 45
  46. 46. WHAT MAKES GREAT ADVERTISING?© McPheters & Company, 2011 46
  47. 47. LIKE A GREAT APP, A GREAT AD PROVIDES A SIGNIFICANTLY ENHANCED MAGAZINE EXPERIENCE •  Added opportunities for interaction and engagement •  The ability to take action — Learn more — Locate dealer — Purchase product •  Lots of rich media content — Points added for various types of features (links, audio, video, animation, social media, live news feeds, localization, interactivity, transactional capabilities) — Points added for unique media features© McPheters & Company, 2011 47
  48. 48. EXAMPLES MARTHA STEWART LIVING© McPheters & Company, 2011 48
  49. 49. North Face EXAMPLES NORTH FACE© McPheters & Company, 2011 49
  50. 50. Examples EXAMPLES RALPH LAUREN IBM© McPheters & Company, 2011 50
  51. 51. EXAMPLES ABC FAMILY© McPheters & Company, 2011 51
  52. 52. APPS WILL RULE •  Tablet penetration is a fraction of what it will be by the end of this year, and a much smaller fraction of what it will be in 5 years •  Most major publications have yet to enter the app space. A year from now, consumers will be able to assume that their favorite publications have apps •  A disproportionate share of apps have problems that negatively impact the consumer experience •  It is not yet easy for consumers to browse apps for something to read and publishers have not figured out how best to market them •  Consumers want subscriptions and for most publications they are not yet available.© McPheters & Company, 2011 52
  53. 53. IT IS STILL VERY EARLY…© McPheters & Company, 2011 53
  54. 54. THE END© McPheters & Company, 2011 54

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